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NextMark’s Joe Pych on The 10 Biggest Problems with RFPs

It’s the fall media planning season. It’s the time of the year when leaves fall and make a mess of all the yards in the neighborhood. It’s also the time of the year when RFPs fall and make a mess of all the desks and inboxes in the media world.

In The Fiesta Nobody Loves, Doug Weaver writes:

“As we enter the fall season and another online advertising year begins to ebb, the human-powered agency RFP process continues — against all odds — to cling to life. For those looking in from the outside, the RFP (request for proposal) is a weekly ritual in which an agency sends out digital planning requirements to five times as many sites and networks as they’ll be able to buy from. The sales reps get all lathered up, put their entire organization into Def-Con 4 status, and turn a detailed proposal around in 36 or 48 hours with relatively little quality information and — unbeknownst to them — very low odds of really being considered.

“Just about everyone you talk to wants this thing to go away. Clients see it as a waste of their billable hours; planning teams feel that it burns out their people; publishers see it as a massive resource drain; and holding companies are desperate to automate it out of existence. It’s the Rod Blagojevich of business practices.”

It’s no secret to anyone in the business that the digital RFP is a frustrating mess. But why is the RFP universally disliked? Here’s a list of its top 10 problems:

1. Spray and pray – Some media planners take a “spray and pray” approach to sending RFPs. They use a tool like those from comScore or Nielsen to find every media program remotely related to the campaign objectives. Then they send RFPs to all of them. They only start filtering when the proposals start coming. It should come as no surprise that most proposals are rejected because they are a “bad fit.” This approach clearly yields a lot of chaff. It’s a major waste of time for both the buyer and especially the sellers.

2. Same old stuff – On the other end of the spectrum, some media planners take a conservative approach and only include large, well-known and safe programs in their media plan. In the fast-moving world of digital media, this is like trying to win the Indy 500 while gazing at elephants in your rear view mirror. Missing from the plan are relevant and up and coming sites. This “same old stuff” approach hurts the advertisers because they end up paying higher CPMs and get mediocre results. There’s always a place in the plan for proven programs, but a breakout media plan needs a healthy share new programs.

3. Who’s on first? – This may seem trivial, but missing contact information is a ubiquitous problem that creates constant friction. With territories, account assignments, and staffing in constant flux, it’s almost impossible for an agency to keep track of their sales representatives. Submitting the “advertise with us” form is guaranteed to land you at the lowest priority.  Sometimes a program will get replaced in the media plan just because it’s too much of a hassle to get connected. This hurts everyone.

4. The never ending media plan – The RFP process is notoriously slow. It may take a media planner two weeks or more to “herd all the cats” and get all the responses needed for their media plan. This is a waste of time and energy that could be better used do develop and execute a strategy.

5. No soup for you – It’s really frustrating for a media planner when a publisher does not respond at all. To fight the “spray and pray” approach mentioned above, publishers are getting smarter about which RFPs they respond to. The emerging best practice is to ignore most RFPs and only engage with those that meet strict criteria. To get a high response rate, planners need to be sure to limit sending RFPs to only high probability programs. Otherwise, they risk being ignored and labeled an RFP spammer.

6. Square peg in a round hole – Despite explicit instructions in the RFP, proposals often come back in a variety of incompatible formats (e.g. Word, PDF, PowerPoint, Excel). This creates extra work for the buyer: they have to reconcile and standardize the information for client presentation. This is a big waste of time for the planner.

7. Incomplete – The RFP asks 20 questions, but the proposal only answers 13 of them. This puts the media planner in a difficult situation. Do they go back to the publisher and ask for answers to the other 7 questions? Or do they drop them from the plan? Both sides are to blame for this problem. Planner should avoid asking too many unnecessary questions in the RFP. Sellers needs to be more diligent in their replies.

8. Wasting time – The RFP process is time consuming for both buyers and sellers. For a buyer, it typically takes 38 hours across 4 job functions to conduct the RFP process. For a seller, it typically takes 4 hours to respond to an RFP with a proposal. A campaign with 10 RFPs consumes 78 hours of work for buyers and sellers.

9. Wasting money – RFPs are expensive. It typically costs agency more than $3,018 per campaign in labor to perform the RFP process, which is often passed along to the advertiser with a markup. Sellers collectively spend at least as much bringing the total to more than $6,000 per campaign.

10. Lacking innovation – According to The CMO Challenge study by the Horn Group, “Marketing execs want to be challenged by the agencies they hire. Yet, a mere 3 percent say agencies are most often leading the charge for their company’s innovation. Instead, it’s marketing directors and execs (44%) and customers (26%) pushing for innovation. At smaller companies – with less than 200 employees – almost half (48%) of marketing execs say they’re the ones driving innovation.” CMOs are frustrated by recycled media plans and lack of imagination.  Although difficult to quantify, this is perhaps the biggest problem of them all. Advertising fails without creative media plans. This puts the advertiser/agency relationship at risk.

With all its problems, you have to wonder why the old RFP is still used today. Is this complicated mating ritual really necessary? Isn’t there a better way to get deals done? Why hasn’t anyone solved this?

  • http://twitter.com/littlekoalamare Marilyn Mead

    Great piece – would love to know what if any alternatives are emerging, even experimentally.

  • http://twitter.com/jpych Joe Pych

    Thanks, Marylin. There are two emerging alternatives:

    1) The “Request for Consideration” or “RFC” turns the RFP inside out and takes a LendingTree-type approach to sourcing proposals. We have clients who’ve started using the RFC with good results. They don’t typically abandon the RFP altogether, but rely on it a lot less (only sending RFPs to high confidence programs).

    2) Avoiding the RFP altogether. Many are questioning the cost/benefit of the RFP. Do you really need to run the heavyweight and problematic RFP process to get the information you need for your media plan? Creative media planners are finding ways to avoid the RFP altogether.

    Hope that helps!

  • Chris DeMartine

    Publishers need to know what will get them rejected and what the priorities are for acceptance. Spray and pray can be an issue in both directions, so it’s important for the planners to be clear upfront and boldly state the most basic requirements. Examples: “do not respond unless you can…” or “we are only considering proposals that…” this extra emphasis on qualification will weed out the distractions and subsequently make the buy side and the sell side more efficient.

  • christopherskinner

    So true: “Spray and pray” is the common approach, resulting in wide reach and horribly low frequency. Along with viewable impression issues, the money would be better spent on renting chicken suits….

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