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The house always wins: gaming the RFP process for agencies

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Request for proposals are common enough; the philosophy behind their use is anything but. At The Drum Network we’ve heard time and again how the RFP process is flawed, how it gives an unfair advantage to incumbents, or how ultimately they can mask flaws in the tendering process. That’s never been more evident than over the past year, in which the strictures of the pandemic have made it a buyer’s market.

At the same time when done properly they can be a vital starting point in a relationship between agency and brand, and ensure a level playing field for agencies of all sizes.

At a recent event hosted by The Drum Network, RFP expert Mike Lander shared his expertise on all things RFP, from when to say no, to how to gain an unfair advantage to improve agency win-rates.

An uphill struggle

Lander began by explaining some of the warning signs that an RFP isn’t being used properly, or to obfuscate the selection process. He noted that a lack of concrete selection criteria is an early red flag: “If someone gives you an RFP, and it's really unclear how they're going to choose, it's a really bad sign as an agency, when you start filling it in, it probably means they've been talking to an agency that's an incumbent or one that's that preferred because they haven't given you very objective criteria.”

The trick, as ever, is to know when to bet and when to walk away. The lure of work, particularly on behalf of a big brand or new client, can often be too much for even experienced agencies who have been through bad RFP processes before. As a result, Lander says, there is often a lack of compatibility between the needs of the agency and the procurement team who “occasionally (or in a few cases, often)... don't seem to really understand or care about how marketing agencies work”. As a result the process can sour right from the beginning.

Lander advises that agencies take the time to research the procurement team ahead of time: “if they're the category lead for “marketing procurement” on LinkedIn, look at their work history: if they recently worked in “direct goods”, and they’re now working in “indirect goods” (often called GNFR), be really careful. They may not know marketing that well. They'll be exceptionally well trained as negotiators. They'll likely be more ruthless/difficult and be highly price/cost oriented.”

That early bit of research will then allow agencies to tailor their initial approach.

Hone your knowledge

Despite that he notes that there is often wiggle room, particularly where there is parity between the proposal from an incumbent vs a challenger agency: “Someone said to me that procurement, like the police, have a set of rules that you can't break. It's not true. It's just tactics we may adopt in various guises to see if we can get the right negotiated outcome that we want.”

Though it sounds obvious on the face of it, Lander also advises that the most successful agencies take stock of their successful and failed RFPs over the course of the year. That allows them to see where their strengths and weaknesses lie based on internal and external criteria. Crucially, he says, it also allows those agencies to understand where they failed to get across their own hard-won expertise in a given vertical:

“Most of the tenders that I ran I was looking for deep specialist knowledge, as sector knowledge is very, very, very important. You need to know my sector dynamics, because if I appoint an agency that doesn't understand my sector and you meet my stakeholders, then it looks very bad on me and on you.”

However he also argues that it’s important to bring out-of-sector knowledge to any procurement process, particularly when the client is undergoing transformation of its own. He cites the ongoing push towards e-commerce as an area in which agencies can take the lead and demonstrate their own expertise: “If they're going through a true digital transformation, and it's sponsored by the CEO, then at that point, I think you're on to a huge winner, because you're bringing out of sector experience to a sector that may be behind the curve on e-commerce, and can take a huge advantage from your experience.”

Those are only a handful of the tips that Lander shared with the group of The Drum Network attendees. The reality is that while the RFP process is still often opaque and can be extremely difficult to navigate as a smaller agency, there are ways to play the system to your advantage.

The Drum Network is for ambitious CEOs and their agencies who want to raise their profile, scale their business, and grow both personally and professionally. If you'd like to know more please visit thedrum.com/network

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