As a freshman, I heard from a roommate that Stanford’s admissions office, when down to the finalists, wrote applicant names on scraps of paper and tossed them from a staircase. Candidates whose names landed face up were accepted into the university. Of course this is a tall tale, but it does stem from the fact that the sheer number of applicants, many of which are probably indistinguishable by their applications (all valedictorians from their high schools, AP wizzes, lacrosse captains, whatever you will…), makes it difficult to select the "right" candidates.
This hypothetical situation is the exact opposite of what one would want to happen in a RFP process for sales and marketing services, not only to avoid angering a bunch of agency executives, God forbid, but to make sure that all parties are utilizing the formal sourcing event to their best advantage.
Whether marketing teams are forced to conduct competitive bidding processes because of a company policy or because they truly wish to explore the various options in the market—or both—it is important to be aware of five practices that will enrich the RFP process and avert a scenario where the decision makers are forced to skim through pages of meaningless fluff and arbitrarily select a supplier.
By emphasizing communication—making details on scope of work, brand team expectations, timescale, and the agency selection process accessible—brand teams, sourcing and procurement, and agencies, are better situated to select an agency that is the best fit for the engagement, as parties are able to make more informed decisions and address problems in a more efficient manner.
- Clear communications between the teams will enhance the quantity and quality of information available to agencies and brand teams, and help avoid situations where agencies are going through a “form-filling exercise ” and risk misrepresentation.
- Understanding expectations leads to a better match. Ideally, the relationship will last for several years, which means both sides of the party will get to understand each other and the brand vision better, and help set the stage for creative and strategic work that better corresponds to the needs of the brand, ultimately saving time and money.
- Giving the agency time to respond adequately to the project’s needs allows agencies to craft a customized response, rather than simply throwing together generic sales pitches.
- On the other hand, pitch processes should not drag out too long by rescheduling and negotiations, as this risks leading to a costly endeavor. Digiday explains , “If it takes six months to select an agency and then three months to ramp up, it’s a massive deal to change, and switching costs are very high.”
- As a facilitator between the brand teams and agencies, procurement should work with both parties to arrive at a common ground.
- Transparency: Sometimes the truth hurts. Brand teams and procurement teams need to feel confident about removing an agency from the selection process if the agency appears significantly less competitive than other bidders in the process, honest and constructive feedback on why the agency was not selected should be provided. Prolonging an unfruitful relationship with the agency will be detrimental to both parties: agencies spend time and money pitching for business they will lose, while brand teams take time and attention away from other agencies that are a better fit .
- Honesty: Providing practical feedback is important as it helps to delineate a brand team’s vision and lend its sourcing initiative greater credibility in the eyes of bidders, as it makes the teams sound decisive. It also helps improve the performance of agencies and prevent agencies from counterproductive self-questioning. In the long run, agencies will be thankful of those who give thoughtful and truthful advice, despite the initial sting of rejection, and will lead to potentially better relationships in the future. A good practice is to involve the CMO/brand team in the feedback process, in addition to procurement, so that they are able to provide additional insights that may have been overlooked during a debrief, or opinions beyond the pitch process, as brand team members often have experienced work on the agency side.
- To be able to fairly assess the opportunity and value of the engagement from both sides, senior staff should be engaged from the start to lay out their vision and to confirm the direction of the selection process. This lends credibility and respect to the engagement, thus both sides are more motivated to contribute to a more productive collaboration.
- Taking steps to define ROI metrics during the stages of the agency selection and negotiation period is critical, as it sets a basic benchmark for gains and losses and eases challenges in calculating ROI in the future will help provide direction and clarity on what to do with the range of marketing data collected throughout campaigns. According to Duke Fuqua School of Business, 66.4% of CMOs surveyed feel pressure from their CEO or Board to prove the value of marketing.
For a complete infographic on the Best Sourcing Practices for Marketing, click here.