How To Select The Right Vendor For Your Company

“Data-Driven Thinking” is written by members of the media community and contains fresh ideas on the digital revolution in media.

Today’s column is written by Maja Milicevic, co-founder and principal at Sparrow Advisers.

When it comes to ad tech and mar tech vendor choice, we’re in an era of abundance.

Scott Brinker’s Marketing Technology Landscape is now up to nearly 7,000 companies, and the LUMAscape has grown to 19 different editions. The number of solutions being described as “end-to-end,” “full stack” or “suite” is in the double digits, and many express the desire to build their own stack to ensure they’re using “best-of-breed” vendors in each category.

In my experience, most enterprises work with 20-50 different pieces of software across their marketing and advertising stacks, but what goes into that mix varies widely.

A good vendor selection process and vendor management can mean the difference between a successful rollout and a costly rip and replace. Unless you’re starting from scratch, such as a new direct-to-consumer brand with the luxury of designing its vendor stack to fit its current needs, you’re likely dealing with an evolutionary stack assembled over multiple years – or decades – of investment and different generations of leadership, often with competing visions of what’s needed.

So how can companies know they’re choosing the right vendor partners?

They should start with a thorough review of what they currently have and map out each vendor based on the following: the department and person who owns the relationship; contract terms and renewal timing; who uses the tool(s) internally and any dependencies that may impact a vendor decision, such as whether the vendor is owned by a parent company, incentivizing its use over competitors.

Ideally, this type of thorough review would be conducted at least every 18 months. It can help identify tech that’s outlived its usefulness, possible duplication of functionality across vendors and remove orphaned technology, where the stakeholder who championed a vendor moves on, but the vendor still lingers because no one explicitly wants to own its removal.

Next, companies must resist the urge to load their RFPs with tactical questions. Minute details about a vendor’s technology won’t matter much if the vendor can’t answer how it can make or save the company money or further its specific strategic goals. Even if there are specific vendors in mind, companies should conduct a full RFP process because it’ll force them to articulate their business objectives and needs clearly and weigh the tradeoffs they’re willing to make for functionality, interoperability and total cost of ownership.

Many companies and overstretched teams approach RFPs as a nuisance whose review is frequently farmed out to junior team members who may not have the breadth of experience needed to read past each vendor’s marketing deck. But identifying the right partners to work with requires a tremendous amount of industry ecosystem knowledge, and RFPs are the easiest way to ascertain who will be a good fit and who won’t.

Finally, a good vendor relationship requires regular attention. The first stumbling point is often after a contract is signed and the vendor’s sales team hands the account to its implementation and account management teams. This is realistically when expectations and guarantees made during the sales process clash with day-to-day reality.

Companies can kick things off by restating their strategic objectives, which members of their team will be responsible for the overall vendor relationship and the short-term – namely, current quarter – expectations. They can then use quarterly business reviews (QBRs) to learn about the vendor’s road map, provide input on functionality they would like to see, involve more senior members of their organization and conduct a regular commercial analysis of the relationship. QBRs will give companies an easy and repeatable format to track progress and compare year-on-year or quarter-on-quarter results with each vendor.

If the speed of innovation, consolidation and pivots continues at the current pace, it’ll remain increasingly challenging to keep track of who’s doing what and how well. Adopting good vendor management as a discipline can really prove to be a key business advantage and protection against aligning with companies of questionable value, reputations and approaches.

As with most things in marketing and advertising, it’s both a marathon and a sprint; we can’t forget about the longer road ahead in order to hit this quarter’s goal.

This post was syndicated from Ad Exchanger.