Negotiation of Advertising Campaign Contract for Basketball Endorsement
Added on 2023-04-19
11 Pages1956 Words420 Views
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Running Head: NEGOTIATION
NEGOTIATION
Name of the Student:
Name of the University:
Author Note
NEGOTIATION
Name of the Student:
Name of the University:
Author Note
1NEGOTIATION
Stage 1
1
The Best Alternative to Possible Agreement for Elite Sports Stars in relation to an
endorsement contract with DeGrandis Sporting Goods with respect to Kobe Bryant for the
negotiation of an advertising campaign contract to endorse basketballs sold by the company are
as follows.
The First BATNA would be a deal with alternative sporting goods retailer, Exercise
Supplies who have offered to provide a contractual fee of $521,740 which can also go up by 15%
as a result of negotiation. This means that if we will not be able to get a favourable deal with
DeGrandis Sporting Goods we would still have the option to carry forward a deal with Exercise
Supplies in relation to endorsement contract. Therefore when we would be getting into a
negotiation with the other party we would have to keep in mind that the deal cannot be less than
$521740 + 15%. Therefore this value can be considered as the reservation value for us.
In relation to the term of advertisement we do not have a BATNA yet and it is dependent
on the negotiation which is carried out with Exercise Supplies.
2
The Best Alternative to Possible Agreement for DeGrandis Sporting Goods in relation to
an endorsement contract with Elite Sports Stars with respect to Kobe Bryant for the negotiation
of an advertising campaign contract to endorse basketballs sold by the company are as follows.
The other party in the negotiation has a BATNA that they can get into a contract with
another basketball star in relation to the contract. However, their BATNA would not be
Stage 1
1
The Best Alternative to Possible Agreement for Elite Sports Stars in relation to an
endorsement contract with DeGrandis Sporting Goods with respect to Kobe Bryant for the
negotiation of an advertising campaign contract to endorse basketballs sold by the company are
as follows.
The First BATNA would be a deal with alternative sporting goods retailer, Exercise
Supplies who have offered to provide a contractual fee of $521,740 which can also go up by 15%
as a result of negotiation. This means that if we will not be able to get a favourable deal with
DeGrandis Sporting Goods we would still have the option to carry forward a deal with Exercise
Supplies in relation to endorsement contract. Therefore when we would be getting into a
negotiation with the other party we would have to keep in mind that the deal cannot be less than
$521740 + 15%. Therefore this value can be considered as the reservation value for us.
In relation to the term of advertisement we do not have a BATNA yet and it is dependent
on the negotiation which is carried out with Exercise Supplies.
2
The Best Alternative to Possible Agreement for DeGrandis Sporting Goods in relation to
an endorsement contract with Elite Sports Stars with respect to Kobe Bryant for the negotiation
of an advertising campaign contract to endorse basketballs sold by the company are as follows.
The other party in the negotiation has a BATNA that they can get into a contract with
another basketball star in relation to the contract. However, their BATNA would not be
2NEGOTIATION
considered as very strong as they would be eager to endorse basketball star Kobe Bryant for the
advertisement campaign in relation to their product. The party we would be negotiating with in
relation to the situation is Pisey Kim. The reservation value for the other party would not be high
initially as they have a much lower estimate which they may use to justify a lower advertising
campaign contract fee. Therefore we estimate the reservation value to be around $550000 +/-
20%. In relation to the term of advertisement, the other party would be long for a long term
association.
3
ZOPA range is the Zone Of Possible Agreement Range (Pinkley et al. 2018). This is also
known as bargaining range and points out an intellectual zone between two parties where both
parties can reach an agreement (Coburn 2015). Outside this zone there is no chance of any
agreement between the parties (Su, Chen and Ro 2017). For instance, where there is a person
who wants to give money at a rate of interest for a specific period of time and other person who
wants to borrow has another interest in mind. In case, both the parties have come to a mutual
understanding in relation to the rate of interest than it can be stated that a possible zone of
agreement has been established between the parties (Pacella et al 2017). The understanding is
ZOPA is essential for the carry out a negotiation in a proper manner. Both parties have to
understand the value and needs of each other to find out whether there is a ZOPA or not (Coburn
2015). This has to be carried out in the early stages of the negotiation and also has to be changed
when more information is derived (Elfenbein 2015).
BUYER RANGE
Zone Of Possible Agreement
SELLER RANGE
considered as very strong as they would be eager to endorse basketball star Kobe Bryant for the
advertisement campaign in relation to their product. The party we would be negotiating with in
relation to the situation is Pisey Kim. The reservation value for the other party would not be high
initially as they have a much lower estimate which they may use to justify a lower advertising
campaign contract fee. Therefore we estimate the reservation value to be around $550000 +/-
20%. In relation to the term of advertisement, the other party would be long for a long term
association.
3
ZOPA range is the Zone Of Possible Agreement Range (Pinkley et al. 2018). This is also
known as bargaining range and points out an intellectual zone between two parties where both
parties can reach an agreement (Coburn 2015). Outside this zone there is no chance of any
agreement between the parties (Su, Chen and Ro 2017). For instance, where there is a person
who wants to give money at a rate of interest for a specific period of time and other person who
wants to borrow has another interest in mind. In case, both the parties have come to a mutual
understanding in relation to the rate of interest than it can be stated that a possible zone of
agreement has been established between the parties (Pacella et al 2017). The understanding is
ZOPA is essential for the carry out a negotiation in a proper manner. Both parties have to
understand the value and needs of each other to find out whether there is a ZOPA or not (Coburn
2015). This has to be carried out in the early stages of the negotiation and also has to be changed
when more information is derived (Elfenbein 2015).
BUYER RANGE
Zone Of Possible Agreement
SELLER RANGE
3NEGOTIATION
Thus in order to find out the ZOPA in this case we need to analyze the reservation values of the
parties. When we would be getting into a negotiation with the other party we would have to keep
in mind that the deal cannot be less than $521740 + 15%. Therefore this value can be considered
as the reservation value for us. The reservation value for the other party would not be high
initially as they have a much lower estimate which they may use to justify a lower advertising
campaign contract fee. Therefore we estimate the reservation value to be around $550000 +/-
10%. In relation to the term of advertisement, the other party would be long for a long term
association. From both the ranges it can be state that the zone of possible agreement is as
follows:
ZOPA for the Negotiation Situation
Thus in order to find out the ZOPA in this case we need to analyze the reservation values of the
parties. When we would be getting into a negotiation with the other party we would have to keep
in mind that the deal cannot be less than $521740 + 15%. Therefore this value can be considered
as the reservation value for us. The reservation value for the other party would not be high
initially as they have a much lower estimate which they may use to justify a lower advertising
campaign contract fee. Therefore we estimate the reservation value to be around $550000 +/-
10%. In relation to the term of advertisement, the other party would be long for a long term
association. From both the ranges it can be state that the zone of possible agreement is as
follows:
ZOPA for the Negotiation Situation
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