5 keys for a successful MarTech RFP in 2024

There will be a surge in RFP activity in 2024. Many brands who planned to take a look at their ESP in 2020/2021, put it on hold because of COVID-19.

This year, droves of brands will start an Request for Proposal (RFP). A lot of business will be up for grabs.

But the selection process is still as fraught with unexpected problems as ever, and brands need the right plan for success. So with that in mind, let’s take a look at best practices for your 2024 RFP process.

1. Negotiate a contract extension with your vendor before starting the RFP

Let’s start with the mistake that’s both most common, and the most problematic to brands doing an RFP. And that’s timing.

The selection process is going to take longer than you think. Trust me on that. And if you do finish it in the time frame you planned, it’s likely you rushed some things and skipped other steps entirely. Which makes it more likely you made a bad choice. So if your contract expired in the second half of the year (or early in 2024), then you need to get moving on your RFP right away.

It can’t wait “until later”. If your contract expires in the first quarter of this year and you want to switch vendors, you might as well flip a coin. You don’t have time to run a thorough RFP process. And your current ESP knows that.

7 step rfp process

You are not going to finish your RFP process in time to get migrated to your new platform before your current contract expires. Even if you are convinced I am wrong about that, what’s the downside to being prepared? None. And if I’m right?

That’s why I always tell our clients to negotiate a month-to-month (preferred) or 3-month (better than nothing) extension before issuing an RFP. Because as long as your current ESP believes it has a chance to retain your business, they will be very accommodating. 

plan your vendor selection RFP

The minute your current email provider thinks you are leaving, they will become much more inflexible.

Now there are some vendors that will never give an extension of less than a year. If you are stuck with one of those vendors, then you need to give yourself 12 months to select a new partner and complete an ESP migration.

So if you’re 6 months out with one of these, it’s already too late. Start planning for a switch in 2024. If you contact me, I am happy to tell you what you can expect from your current vendor.

2. Bring in an outside resource to help manage your RFP

The second most common mistake I see brands make when managing an RFP is inviting ESPs into the process who have no business being included.

Listen, I think the vendor landscape is more confusing than ever. Even I get confused!

Do you understand the differences?

There are significant differences between the various ESPs. These differences have a huge impact on how good a fit a particular ESP will be for your brand.

Most email marketers don’t see these differences. And who can blame them? Sales people will pitch their platform to anyone as a perfect fit, and the various analysts are always rating vendors without a thought to how different they are from one another. 

Don’t fall for the herd mentality

There is also a little bit of “herd mentality” among email marketers. And that thinking leads many to invite ESPs to pitch their business simply because it seems like everyone else is looking at the same 2-3 vendors.

So with a lack of understanding the differences between vendors, and the tendency to look at the same few “hot” vendors as everyone else, a brand can end up with 6-8 vendors in its RFP, of which only 2 or 3 are actually going to be a good fit.

I don’t like the odds of making the right selection in that RFP, do you? Which leads us to…

Know which channels are most important to your customers

Particularly in the case of ecommerce brands, you need to understand which channels your customers use most often to engage with you. Some ESPs are “mobile-first”, others are “email-centric”, while others are truly “omnichannel”.

Creating a mis-match between the type of ESP you select and your customer behavior is going to lead to a lot of unhappiness for you and your customers. 

You HAVE to get this right.

Bringing in an outside consultant will greatly increase the odds that you will make the best  choice. Their business depends upon knowing the differences between the vendors, and making sure you only look at those who represent a good fit. I know it sounds self-serving to mention getting outside help. But that doesn’t take away from the fact that it’s a smart thing to do. 

3.Use a scorecard and make your decisions for the right reasons

Just the other day I talked with a vendor. They were back pitching a prospect they had pitched the year before and finished second.

The winner of that RFP had been the personal favorite of a VP who imposed his will on the entire process. Predictably the team using the platform hated his choice, as did IT. Of course, the VP has long since left the company. So just a few months after the migration to the new vendor, here they were again looking at their options. 

Do you have the right people in the selection team?

There are always going to be people involved in an RFP process who have favorites going into the RFP. That’s normal, and there are a lot of reasons why a particular ESP might be someone’s favorite. And look at it from different angles, like procurement, IT, marketing.

But it becomes a problem when the person with a favorite ESP can drive the decision in a particular direction (like the unhappy brand mentioned above).

Using a scorecard

The best way to prevent a new ESP selection based on the wrong reasons is to use a scorecard driven process that allows for direct, side by side comparisons of the competing vendors.

email marketing RFP scorecard

Use scorecards that cover features and functionality, services, and pricing. This has two key benefits.

First, if everyone’s scores are treated equally, a single person can’t drive the outcome. So even if someone strongly supports one of the ESPs in your review, he or she can’t force that decision.

Second, it allows for the input of everyone on your team who wants a say in the decision. If everyone is responsible for the vendor selected, then everyone has a stake in making sure it works out. And trust me, that is a very good thing!

4. Complete your RFP and come to a decision

The road to a great new vendor relationship is littered with the corpses of RFPs that never made it across the finish line. There are so many reasons why an RFP doesn’t come to a conclusion, but the result is the same. Nobody is happy – even the brand involved – when an RFP never gets concluded and a new vendor doesn’t get selected.

Here’s a partial list of reasons why an RFP might never come to a conclusion. 

  • running out of time and having to sign an extension with your existing vendor,
  • reaching a point where you don’t have any good options
  • no one has the energy to continue

You’ve got a day job, and RFPs take up a lot of time. This is where consultants can be useful, doing most of the heavy-lifting for you.

Don’t lose sight of the reason you started

Sometimes the RFP has dragged on so long that no one remembers why it was started in the first place. Maybe the person who started it isn’t even with the company any longer! If you’re not going to finish your RFP, put it out of its misery, and make sure you tell the participating vendors that it’s over. 

The worst thing a brand can do in these cases is to pretend that nothing happened to begin with, leaving the participating vendors in the dark about what decisions did or did not get made. But the point is, don’t let things get that far.

Keep pushing through to a decision. There’s a reason you started the RFP process in the first place – don’t lose sight of it!

Even if that means backtracking a little to make sure you are evaluating the right platforms on the right features and functionality for your unique needs.

The only ones who like unfinished or unending RFPs are the incumbents, who get to keep the business without making huge price concessions. They’ve realized you aren’t moving, and have no reason to cut pricing to keep you on board.

5. Understand what you absolutely need in your contract (and what you don’t).

There are too many unknowns on both sides when you enter into a contract with a new ESP to hope you can actually get everything 100% right at the outset. So you should focus on what you absolutely must get right. The list is short:

1. Limits on liability.

Let’s start with the obvious – I’m not a lawyer. That being said, when negotiating contract terms, vendors will want to include clauses that attempt to limit or exclude damages that the client can claim if a breach of contract occurs.

This makes perfect sense. If there is no limit to liability, there is no financial limit on the damages in the event of a breach. Vendors will try to lower the limit as much as possible, often to no more than the total value of the contract.

While vendor lawyers and finance teams want the limit as low as possible,  brand lawyers are going to reach for the stars. As the client you need to understand what the financial consequences of a breach can be to your company. There’s no doubt that it can be more than the contract value.

This is often the most contentious part of a contract negotiation. You need to ensure that the lawyers get this solved upfront. It isn’t fun, and I’ve seen it blow up deals. But if both sides are committed, then there is a middle ground that can be reached.

2. Service level agreements and associated penalties.

This sounds similar to the liability issues, but service level agreements are vastly different in degree of seriousness. SLAs are things like platform uptime, campaign turnaround, and other day-to-day operational issues. These are in a different league than data breaches.

You need to nail down in the contract your expectations, and attach a painful enough penalty that the vendor does everything in its power to meet the SLAs.

Both sides are going to come to these from completely different starting points, so expect to meet somewhere in the middle. But remember every promise made during the pitch, because now they are going into the contract!

3. Contract termination.

No one is going to argue that a breach of contract allows the client to prematurely end a contract. Where it gets tricky, is what is known as “out for convenience”.

This allows a client to terminate a deal “just because”. Vendor financial people hate these, and client lawyers love these. In defense of the vendor, if you have a 3 year contract with 90 day “out for convenience”, then the contract itself is actually a 3 month contract. It’s not a 3 year contract.

Vendors often make pricing concessions based on the length of a contract, knowing that discounts for migration (for example) can be amortized over the entire length of the contract.

So they will naturally push back HARD on any kind of out for convenience. On the other hand, client-side lawyers hate being tied down to any kind of contract they can’t get out of. So they will push hard on this. The poor email marketer is stuck in the middle and needs to lead both sides to some kind of middle ground. We’ve done this several times for clients and vendors at a contract standoff.

Once you get these three items nailed down, it’s time to recognize that you don’t need to nail everything else down 100%.

Think about services and support in your contract.

Trust me,  you are going to need something here no matter how “self-service” you consider yourself to be. But you only need to get in the ballpark of what you will need if you write the contract correctly.

In the contracts we negotiate for our clients we try to arrive at the right number of hours, but we also stipulate that an audit of actual hours used be conducted 6 months after the cutover to the new vendor. This gives everyone enough time to settle into a routine and know what the real need is.

If the client is using more hours than they are paying for, then they can either cut back on what they expect from the ESP, or add hours to the contract going forward. And if they aren’t using all the hours they are paying for, the retainer hours can be adjusted down.

Frankly, it’s a great time to do an RFP

While the vendor landscape is complex and confusing, it’s also seeing more innovation and new players than we’ve seen in many years. You will likely be amazed at some of the new offerings.

Lots of vendors you wouldn’t have looked at last time around have been busy adding capacity, new features, and/or entirely new channels.

If you follow the best practices above in your RFP, you will ensure that you make the best possible choice for your company, and negotiate a deal that works for both sides.

If you keep that in mind, and this article close by, you’ll be off to a great start! 

About Chris Marriott

President & Founder of Email Connect. A 25-year veteran of digital marketing, including well over a decade in email marketing, Chris is a recognized expert in the process of connecting leading brands with the right marketing technology partners and platforms.
Prior to founding Email Connect as a consultancy focused exclusively on the ESP/CRM vendor selection process, Chris served as a tenured executive at Acxiom, leading and building its Global Digital and Email Agency Services team into one of the industry’s top services providers.
Chris is also the co-host with Paul Shriner of "Email Geeks at Home Drinking Coffee", a weekly podcast devoted to featuring guests from business, sports and the arts who have great and inspiring stories to share--which sometimes includes email marketing!
Additionally, he is a regular columnist on email marketing and the RFP process and is an advisor to several emerging marketing technology companies including AudiencePoint and CertainSource.

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