Choosing a new email services provider (ESP) is a critical decision, with significant implications for your marketing strategy and operational efficiency. While much has been written about the technical and strategic aspects of this selection, one area often overlooked is the precise role your procurement team should (and shouldn’t) play in the Request for Proposal (RFP) process.
The involvement of procurement in an RFP for a new ESP can be non-negotiable for many organizations. Certain company policies, especially in government and large enterprises, mandate periodic RFP cycles. Even when not explicitly required, procurement often needs to approve the initiation of such a significant process.
Understanding procurement’s strengths and limitations is paramount to securing a successful outcome for your ESP RFP. Their expertise lies in process and negotiation, but marketing technology, particularly ESPs, presents unique challenges they may not be equipped to handle alone.
What is Procurement?
Procurement, at its core, is the act of obtaining goods, services, or works from an external source, typically through a competitive bidding process that includes agreeing to specific terms and conditions.
The Procurement Department is the group within an organization authorized to manage this process. They are responsible for issuing:
- Invitations to Bid
- Requests for Proposal
- Requests for Quotation
- Contracts
Additionally, a Procurement Department issues purchase orders and negotiates terms.
In essence, the role of procurement is to:
1) Ensure the process is run correctly,
2) Verify that the services align with organizational needs, and
3) Most importantly: Secure the best possible price.
Most procurement departments excel at managing the process itself, as they handle numerous RFPs. However, many of these RFPs are not for complex marketing technologies like an ESP. This introduces two critical hurdles when it comes to selecting an ESP: understanding the specific services needed and determining the right price.
Your Procurement Team Doesn’t Truly Understand Your Needs
How could they? Email marketing platforms are incredibly intricate systems. This isn’t akin to purchasing office supplies or janitorial services, where price is often the primary driver. When selecting a new ESP, platform alignment with your specific requirements is the number one priority.
Because your procurement team isn’t typically steeped in the nuances of email marketing, they aren’t the ideal starting point for building the detailed requirements document for your RFP.
It’s common to see requirement documents for RFPs that appear to be repurposed versions from several years prior. While it’s understandable that procurement teams might rely on past templates, they may not grasp how significantly ESP platforms have evolved. Sticking to outdated RFP requirements will likely lead to selecting an ESP that was perfect for your organization five years ago, not today.
Your Procurement Team Lacks Insight into Optimal ESP Pricing
Procurement professionals are highly skilled at comparing vendor prices and negotiating bid reductions. Vendors often anticipate this by initially padding their bids. However, if your procurement team enters the RFP process without a solid understanding of what fair pricing looks like for ESPs, it’s difficult to be certain you’ve achieved the best deal. This isn’t a failing on their part; even internal marketing teams often struggle to grasp the true cost.
ESPs are adept at making their pricing models complex, incorporating various fee structures that allow them to obscure the real cost. This often comes as a surprise to procurement teams, who traditionally focus on Cost Per Mille (CPM) as the key pricing metric.
Specialized consultants or market experts, who continuously analyze hundreds of ESP pricing proposals and track trends over many years, possess an unparalleled understanding of market rates. This deep market insight ensures pricing discussions are transparent and effective, often leading to more favorable terms than procurement teams could achieve independently.
What is the Role of Procurement in Your RFP?
Procurement can play a valuable role in your next ESP RFP, especially when collaborating effectively with internal teams and external experts. Here’s an overview of how procurement’s involvement can be optimized across different phases of the selection process:
| Selection Phase | Role of Procurement | Tips / Notes |
| Pre-RFP / RFI | No role for procurement unless company policy dictates periodic RFPs | If it’s a company rule, don’t push back |
| Create the Requirements/RFP | Provide boilerplate requirements/questions required in any RFP issued by company | Try to keep the boilerplate to a minimum and validate them. Avoid micro-management |
| Evaluate the RFP responses | Involvement level is up to the procurement team | In a scorecard-driven process it’s always good to include all interested parties willing to go through the responses |
| Meet and select the finalists | No role | |
| Sandboxes / trial and select Winner | No role | |
| Negotiate contract and terms | Your Procurement team should take the lead here | Selection team need to stay involved to ensure that your opinions are taken into account |
Engaging an external consultant in an RFP process doesn’t undermine the procurement team’s role; rather, it empowers them to perform their job more effectively. A consultant can guide the client’s email team toward the ESP best suited for their unique requirements and leverage deep market knowledge to secure optimal pricing.
Conversely, if procurement resists the involvement of outside consultants, they can inadvertently hinder or even sabotage the entire effort.
A Cautionary Tale: The Impact of Misaligned Procurement
An organization once faced significant challenges during an ESP RFP, largely due to internal procurement dynamics. Apparently, the procurement department had been excluded from a previous Content Management System (CMS) RFP and was determined to assert its authority in this new process.
From the initial meetings, it became clear that the procurement representative intended to make the process as arduous as possible for all parties involved. She insisted on being the sole point of contact for external advisors. Requirements documents underwent numerous revisions, with requests for edits of dubious merit. She then demanded that all requirements be converted from statements to questions, a change that had no bearing on the document’s substance but introduced significant delays and additional work.
Eventually, the email marketing lead who initiated the RFP left the company. Soon after, the external consultant involved in the process was disengaged by procurement, with the stated reason that the RFP was being put on hold. However, a short time later, some ESPs reached out, remarking on the striking resemblance of the subsequent, internally-managed RFP to the one previously developed with external expertise. The RFP, now solely under procurement’s direction, dragged on for twelve months, ultimately concluding inconclusively with the incumbent provider retaining the business. In this scenario, there were no winners.
Fostering Collaboration for Successful RFPs
All organizational stakeholders must understand that engaging specialized external consultants for an ESP RFP is not an either/or proposition; it’s about synergy. The most successful outcomes often arise when an organization’s procurement team collaborates effectively with specialized external advisors. Procurement needs their market insight and platform expertise, and advisors benefit from procurement’s process management and negotiation skills.
If you’re embarking on an RFP and encountering resistance from your procurement team regarding external assistance, insist on a meeting between all parties. This can make all the difference. RFPs where all stakeholders are aligned are successful RFPs. You want your procurement team as a valuable member of your project, but you also want them to focus on what they do best, optimizing their contribution for the overall success of the initiative.