The Contrast Principle in Negotiations – How to Make Small Wins Look Trivial (and Get Them Agreed To)
Article by Omid G
Negotiations aren’t just about numbers—they’re about psychology. One of the most powerful psychological effects at play is the Contrast Principle. It’s subtle, often invisible, and yet it can dramatically influence decision-making on both sides of the table.
Let me illustrate with a personal story.
A $130K Decision That Felt “Small”
I’m currently selling a house in Northern California while looking to buy in coastal San Diego. Selling means expenses—lots of them:
Lost rent from my tenant moving out early
Landscaping and repairs
Multiple inspections
Professional staging
Realtor commissions and closing costs
All told, that’s over $130,000 out of pocket.
When I mentioned this to my cousin, he said:
“Yes, but that’s nothing compared to what you’ll make in net proceeds.”
He was evaluating the $130K not on its own merits, but in comparison to the money I’d clear from the sale. That’s the Contrast Principle in action.
What the Contrast Principle Really Means
The Contrast Principle says we judge value relative to the context in which it’s presented—not on its intrinsic worth.
In my case, whether the house sold for $1M or $3M, the cost of those services was still $130K. But when net proceeds are high, the $130K feels small. When proceeds are lower, the same $130K suddenly feels huge—even though the services provided haven’t changed one bit.
Everyday Example – Buying a Car
Say you’re buying a car:
Base model: $30K
Mid-range model: $35K
Top model: $40K
You go in planning to buy the base model, but you think:
“Since I’m already spending $30K, what’s another $5K for the mid-range?”
If the base model were $50K instead, that same $5K upgrade feels even smaller. But if the base model were $15K, the $5K difference suddenly feels significant—again, even though the upgrade’s actual value hasn’t changed.
The Negotiation Trap
Here’s the mistake: judging the value of an add-on or extra based on what you’re already spending, rather than the actual worth of that add-on.
In negotiations, this can cause people to:
Overpay for extras they wouldn’t otherwise buy
Underestimate the significance of small concessions
Lose sight of value in isolation
How to Use the Contrast Principle to Your Advantage
Here’s where it gets interesting: You can ethically use this principle to strengthen your position.
Read this twice: Always pair your smaller negotiation demands with your larger ones.
When a small request stands alone, it’s evaluated on its own and gets more scrutiny. But when it’s coupled with a much larger request, it feels minor by comparison—often not worth resisting.
Example: If you’re negotiating a multi-million-dollar supply contract, add a smaller request—like a service upgrade or extended warranty—alongside your major terms. In contrast to the big-ticket items, the supplier is more likely to grant the small concession without a fight.
Why This Works
It’s not manipulation. There’s no deception. This is simply understanding how the human brain works. People naturally anchor value judgments to surrounding figures and circumstances. By structuring your asks strategically, you make it easier for the other side to say “yes” to the smaller ones.
Key Takeaway:
The way you package and present your requests is just as important as the requests themselves.
Put the Contrast Principle in your negotiation toolkit—and be alert when the other side tries using it on you.
Now, go off and do something wonderful.
Be your best.
Omid G
“The Godfather of Negotiation Planning” – Intel Corp