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Building Your Brand Through Failure

Successful bids bring work. But unsuccessful bids should still build your brand.

arrows missing target

By Ron Sellers

I just had to give a potential vendor some bad news:  their pricing was by far the highest bid we received on a project.  In fact, it was about double the next-highest bid.

Their response?  “Thanks for the feedback and best of luck on the project.”

What does this say about that vendor?  To me, it says they’re not very interested in learning, improving, or growing.  To me, their brand now means, “We want the low-hanging fruit, but don’t care to learn about your needs or discover how we could do better.”

Any time Grey Matter Research is not selected for a project on which we provided a proposal, I want to know why.  And believe me, if the feedback is that we were twice as expensive as any other bid the client received, I’d really want to know why.  I’d figure we messed something up or made some assumptions that no one else was making.  Whatever happened, I certainly wouldn’t want to repeat the problem – I’d want to learn from it.

How a company acts in defeat tells me a lot about that company.  I remember years ago, when I was working at a major bank, I received a recommendation for a new vendor.  I asked them to bid on a project along with my regular vendors.  Their bid came in about triple what anyone else offered.  I figured they must have missed something on the RFP, so I called the project manager.

“No,” he sniffed, “that bid is accurate.  That’s what it will take to accomplish the project.”  When I told him how far out of the ballpark his price was, he haughtily informed me, “None of your other vendors can do this job properly.  We’re the only ones who can.”  I was floored by this, particularly since he didn’t even know who else was bidding on the project.  What he basically communicated was that his company was the only one in the world that could do the project correctly, and I was an idiot if I didn’t recognize that.  Needless to say, they have never received another RFP from me.  To me, their brand is, “Arrogant.”

Another fairly common response I get is attempted negotiation coupled with indignation.  “Why did you just give the project to someone else because they were less expensive?  I wish you had told me – we would have matched their costs.”  What you have just informed me is that you were happy to bilk me for extra money if you could get away with it, and now you blame me for your failure to get the project.

That type of approach does not provoke a lot of trust, particularly on projects where we’re very clear with vendors that we sent the RFP to a small group of firms we are confident can handle the work well, but from that group all bids were a one-shot, best-price approach.  That tells me their brand is, “We’re out for our own interests – not yours.”

We often (after the award) provide all bidders with all of the costs we received (not identifying who else bid on the project).  I’ve been asked to stop sending RFPs by vendors that are consistently on the high side (which is fine – if they don’t want to compete with others on price, that’s their prerogative).  Inevitably, however, a new account manager comes in and then wants to know why we no longer send them RFPs.  Wait – your company told me to go away, and now you want to know why I went away?  That tells me your brand is, “We’re disorganized and don’t communicate internally.”

Some vendors leave me with a positive perception, even when I deliver a negative decision.  I love it when vendors honestly want to know why they didn’t get the job, because it gives me the opportunity to provide feedback and maybe start a dialogue that will lead to better collaboration.  When they don’t get defensive, don’t make snotty remarks about the company (unknown to them) which did get the work, don’t warn me about the terrible mistake I’m making, and don’t try to change my mind, but they do seek to learn from the experience, do ask questions that will help them craft proposals that are closer to what I really need, and do leave me with the impression that they honestly value my business and my feedback and want to do what’s necessary to win the job next time, their brand value goes up quite a bit in my mind.

This is true even if the reason they didn’t get the project had nothing to do with the vendor or their bid.  For example, I frequently tell vendors they didn’t get a project because we went with a different methodology, because we’re using a different market, or because the client decided not to do the project at all.  There’s nothing the vendor could have done to get that project.  Even so, I’m rarely asked to provide any feedback on their rejected proposal.   What a lost opportunity for the vendor to learn how their proposal compared to others, how well it fit what I was looking for, how I perceived the vendor, and other valuable insights.

Even when the client’s decision appears to be unwise, it’s a mistake to say or do things that will harm your brand.  I remember giving a proposal to a non-profit organization and having them tell me they selected another vendor.  When I explored the reasons for this, I was informed that although the other vendor had no experience at all in the non-profit world (as opposed to our extensive track record in that arena), the other vendor was really big.  “They have something like nineteen buildings, and that really impressed us!”

Frankly, that’s pretty absurd criteria for selecting a vendor, but would it have helped my company’s brand for me to express that to the client in some way, or to question their decision?  Unlikely.  I would just appear to be a sore loser.  Sometimes all you can do is wish the client well and emphasize how much you’d like to work with them in the future.  But at least I knew there’s nothing I could have done to land that project (short of erecting twenty buildings to trump the competition’s nineteen…but unfortunately that wasn’t in the budget).  And yes, I did take the opportunity to ask questions about how the proposal and my company were perceived, even though there was not a thing I could have done to get the work.

Everybody wants to win every project, and it’s disappointing not to get the business.  But how you act when you don’t win the business is just as important to my perception of your brand as how you act when you do win the bid.

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5 responses to “Building Your Brand Through Failure

  1. Ron, there are times when clients need to be reminded to question their buying decisions. I think a response from a supplier that shows little interest in your views on why they did not get the job may well be because they knew the organization was too often price seeking and were not surprised by the final decision on supplier. My old boss told me “never let clients go to confession on you”. I think that was possibly part of what you wanted -, to relieve the guilt as much as you feel it may have been about enlightening the supplier.

    In my experience client views on why they awarded one supplier and not another are generally not that objective. I have sat in review committees where the scoring checklist should have guaranteed one supplier won the job, but it went to another for very spurious and strangely biased reasons to do with clothing or accents or other unrelated factors.

    In my view this client who shows low interest in your rationale is the kind of client I would prefer to work with, someone who knows their capabilities and doesn’t feel they need gratuitous advice, There are times when suppliers need this kind of feedback, but there are also times when the buy-side needs to know that not everyone is there to pander to their self perceptions. In general your points are excellent, but this is a tactic I have used on a few occasions and it has had the desired result of establishing rules for professional relationships.

  2. Hi Ron:

    Thanks for this post! I always ask why if I don’t get the work. While that sometimes results in an uncomfortable silence, it also tells me what I can do better or if nothing could really be done. You can tell a lot about a buyer by the way he or she handles those calls.

    Every project has some degree of uniqueness, whether it’s in the buyer or the project. Most people who have been in this business for awhile have learned to qualify a project before the effort has been put into the proposal development. If a buyer is serious, he or she wants you to understand the particulars of a project. They expect questions, some handle them by email with a general posting while others have conversations. Winning a deal is not all in or out by an RFP, it’s a series of steps that confirms to both the buyer and seller that they have a good grasp of the work objectives and the ability to work together. It’s not magic and it’s not smoke and mirrors. It’s listening – on the part of both parties. If the dialogue is not there, there is something wrong. In general all the working bids are usually within 10% of one another and if it’s off by more than that then there was a breakdown in communication somewhere down the line. As always, the best projects are usually collaborations between the buyer and the vendor on the objectives and often if the relationship is working, there are only three bidders and the other two are just to make sure they didn’t miss anything.

  3. Chris, I’ve been on both ends of the equation many times – telling vendors they did and did not get the project, as well as being told my company did or did not get the project. So I’ve experienced about every reason for a rejection that there is (valid and ridiculous).

    My issue with your comment is that you have created an entire backstory for the example I told about the vendor not caring that their prices were double, based only on your assumptions. Unfortunately, much of it isn’t accurate.

    To give some more details in this particular case, it was a group of vendors I had not used before for a very specific situation, so there is no way they “knew the organization was price seeking.” In addition, they were double the price of anyone else, so obviously all of the other vendors figured out a way to do the work at half the cost. When one vendor is a serious outlier, either way high or way low, there’s usually a problem of some kind. And notice that the price was double, so it’s not as though they were told they lost the project because they were 2% higher.

    The thing that really struck me in your comment, though was that you would like to work with the kind of vendor that doesn’t feel they need “gratuitous advice.” I am their target market, and in this case, they failed with their target market. Why would they NOT want whatever feedback they could get? If they feel it’s absurd, they can always discount what I say, but isn’t the business of market research essentially getting “gratuitous advice” from the target market?

  4. Ron, thank you for this! So far it only happened onces that a client gave me an explanation on why they didnt chose our offer. I think it also depends on how tranparent the evaluation criteria are. Anyway, i will include your blog in the readings for our internal collequium. Best

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