Extreme opening isn’t just a bold move; it’s a sophisticated strategy rooted in psychology and negotiation dynamics that can turn the tide of discussions in your favor. When you’re entering a high-stakes business deal, the way you make your first move can significantly impact the final outcome. A well-timed extreme opening sets the anchor point of the negotiation, guiding the conversation in a direction that benefits you. But while this tactic is powerful, it requires a deep understanding of the context, your counterpart, and the potential risks.
In this post, we’ll explore why extreme opening works, the psychology behind it, how it’s used in various types of negotiations, and how to counter it when used against you. We’ll also break down real-life examples, such as Dwayne Johnson’s Hollywood negotiations, to show you how this tactic plays out in high-stakes scenarios.
Why Extreme Opening Works: The Anchor Point Effect
At the heart of the extreme opening strategy lies the concept of anchoring, a cognitive bias where the first piece of information offered in a negotiation serves as the reference point, or “anchor,” for all subsequent discussions. Whether you’re aware of it or not, your brain tends to latch onto this initial figure, and it shapes your expectations moving forward. That’s why the first offer is so critical: it sets the psychological framework for the negotiation, pulling all future decisions toward that starting point.
Take this scenario: you’re selling a product that you value at $15,000, but instead of opening with that figure, you start at $20,000. Even if the buyer feels that $20,000 is too high, they’re likely to negotiate down to $15,000—and feel like they’ve made significant progress. What they might not realize is that you’ve steered them toward the number you wanted all along. This is the power of extreme opening and anchoring in negotiation.
Anchoring works because it forces the other party to adjust their expectations based on your initial offer, even if it’s an extreme one. The farther you can push the initial anchor point, the more room you have to make concessions while still landing at a favorable outcome.
The Psychology of Anchoring in Negotiation
To truly understand why extreme opening is so effective, you need to grasp the psychology behind anchoring. Studies have shown that individuals are highly influenced by the first piece of information they receive—whether they’re aware of it or not. This bias is particularly strong in negotiations, where uncertainty and limited information make it easy for the initial offer to shape the entire discussion.
Economists Amos Tversky and Daniel Kahneman, pioneers in behavioral economics, documented how anchoring can distort decision-making. Their research showed that even irrelevant anchors (like random numbers or unrelated data) can influence people’s judgments. In negotiations, the first offer sets a clear anchor, and unless the counterparty is prepared to challenge that point, they’re likely to be swayed by it.
For example, you’re negotiating a long-term supply agreement for components needed in manufacturing. The current market price for the components is around €500,000 per year. You start the negotiation by proposing a price of €450,000.
While this may seem slightly lower than the expected market rate, it’s not an extreme or unreasonable offer. By setting this anchor, you are subtly influencing the vendor’s perception of what an acceptable price range is. They now have to negotiate within a range that starts from your anchor point.
The supplier, while not agreeing to your €450,000 offer, feels compelled to counter somewhere close to it, perhaps offering €475,000. Thanks to your anchoring, you’ve moved the negotiation closer to your desired target of €450,000 while securing a better deal than the typical market price.
Anchoring frames the conversation around a reference point that benefits you, even if you’re not expecting the other party to accept it immediately. The initial number impacts the trajectory of the negotiation.
When to Use Extreme Opening: Timing and Information
Not all negotiations are created equal, and the success of an extreme opening depends heavily on the context. Specifically, the level of information asymmetry—the imbalance in how much each party knows—plays a critical role in determining whether or not an extreme opening will be effective.
In situations where one party has significantly more information than the other, they can afford to push the boundaries with an extreme offer. For example, in real estate, a seller who knows the market better than the buyer might start with a higher asking price, leveraging their superior knowledge to anchor the negotiation. Conversely, in cases where both parties have equal access to information (say, two companies negotiating a partnership), an extreme opening could backfire, damaging trust and making the other party less willing to engage.
When deciding whether to use an extreme opening, ask yourself:
- Do you have more information than the other party?
- Is the other party open to negotiation, or are they likely to dismiss extreme offers?
- How important is the long-term relationship?
If you hold more information and the relationship is more transactional than long-term, an extreme opening could be the perfect tool to claim more value.
Extreme Opening in Competitive vs. Collaborative Negotiations
One of the most important factors to consider when using an extreme opening is the type of negotiation you’re entering. The tactic can be highly effective in competitive (distributive) negotiations but needs to be handled more delicately in collaborative (integrative) settings.
Competitive Negotiations: Claiming Maximum Value
In competitive negotiations, where the goal is to secure as much value as possible for yourself, an extreme opening can serve as a strong statement of your intent. This is especially useful in one-off deals or transactions where the relationship between the parties is not a priority. By setting a high anchor point, you create more room for concessions without compromising your desired outcome.
For example, your company is bidding for a multi-year service contract worth about €1 million per year based on market rates. You’re confident that the value your services provide is higher than the competition and want to maximize your profit.
You open the negotiation with an ambitious offer of €1.3 million per year, positioning your company as the premium provider in the industry. This extreme opening sets the expectation that your services command a higher price due to their superior quality, reliability, and value.
While the client may balk at the high opening number, they might counter at €1.15 million—already €150,000 more than the market rate. By anchoring high with an extreme opening, you’ve nudged the negotiation significantly closer to your goal and secured a deal that reflects maximum value.
Extreme openings work to claim maximum value in competitive negotiations, especially when you’re confident in your position and can justify your offer. The high anchor creates room for the other party to negotiate down while still achieving a favorable outcome for you.
Collaborative Negotiations: Balancing Trust and Value
On the other hand, in collaborative negotiations—where the goal is to create value for both parties—extreme openings need to be used with caution. If you start too high, you risk alienating the other party or damaging the relationship, making it harder to collaborate and find mutually beneficial solutions.
In these scenarios, it’s essential to gauge the other party’s willingness to be open for negotiation. Setting an extreme anchor may still work, but it should be done in a way that signals flexibility. For example, rather than making an unyielding demand, frame your offer as a starting point, leaving room for discussion. This shows the other party that while you’re serious about your needs, you’re also willing to listen and collaborate.
Managing the Fallout of Extreme Opening
One of the biggest risks of extreme opening is its potential impact on relationships. While this tactic can help you secure favorable terms in the short term, it can also erode trust, particularly if the other party feels manipulated or pressured.
While extreme openings often lead to better immediate outcomes, they can damage long-term relationships, making future negotiations more difficult. To avoid this pitfall, it’s important to manage the aftermath of an extreme offer carefully.
Here are a few ways to balance the impact of an extreme opening:
- Transparency: Be open about your reasoning for the high offer, explaining that it’s a strategic starting point rather than an absolute demand.
- Consistency: Follow through on your commitments during the negotiation to show that you’re trustworthy, even if your initial offer was aggressive.
- Gratitude: Express appreciation for the other party’s time and effort, showing that you value their input despite the bold nature of your opening.
By maintaining open communication and demonstrating flexibility, you can mitigate the negative effects of an extreme opening and preserve the relationship for future negotiations.
Responding to Extreme Openings
What if the other party opens with an extreme offer? How should you respond?
The first and most important step is to recognize that they’re attempting to set an anchor point. Once you acknowledge this, you can take steps to counteract the psychological pull of their offer. The key is to resist the temptation to immediately counter with a middle-ground figure.
Instead, try these strategies:
- Defuse the Anchor: Clearly state that the initial offer is too extreme to be within the realm of consideration. This helps reset the expectations and prevents the anchor from shaping the rest of the discussion.
- Counter with Data: Bring facts and figures to the table to justify your counteroffer. By providing evidence that supports a more reasonable range, you reduce the power of their anchor.
- Use a Counter-Anchor: Respond with your own bold counteroffer to re-anchor the negotiation in your favor. While this tactic carries some risk, it can neutralize their extreme offer and create a new baseline for the conversation.
The goal is to show that you’re open to negotiate, but you’re not going to be pulled into their extreme frame of reference.
Real-Life Example: Dwayne Johnson’s Extreme Opening Move in Hollywood
A high-profile example of extreme opening in action is Dwayne Johnson’s 2018 negotiation with Universal Pictures for the film “Red Notice.” Johnson’s initial demand was staggering—$22 million upfront, plus significant creative control over the project. This bold move set a high anchor point that shaped the entire negotiation.
Rather than being deterred by the extreme nature of his demands, Universal recognized Johnson’s commercial value and agreed to his terms. The final deal gave Johnson one of the highest paychecks in Hollywood and allowed him creative input on the film.
This case highlights the power of extreme opening when applied strategically. By setting a high anchor, Johnson positioned himself as an essential part of the project and secured a deal that reflected his value to the studio.
The Strategic Power of Extreme Opening in Negotiation
Extreme opening is a powerful negotiation tool, but like any strategy, it needs to be used wisely. By setting an audacious anchor point, you can shift the conversation in your favor and create more room for negotiation. However, it’s crucial to balance this tactic with the broader dynamics of trust, relationship management, and the specifics of the negotiation context.
Whether you’re negotiating a business contract or a complex deal, understanding when and how to use extreme opening can help you claim more value while still leaving the door open for negotiation. Just be mindful of the potential long-term consequences and manage the fallout carefully to ensure you’re not burning bridges for future opportunities.
With the right balance of boldness, strategy, and relationship management, extreme opening can be a game-changer in your negotiation arsenal.
Martin Pilch 
