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October 1, 2008

1

RFPs: The Biggest Scam in Business

by Anthony Verre

RFPs and Search Marketing Firms

Killing The Golden Golden Goose

Killing The Golden Golden Goose

If you’ve ever been in the agency or firm world, then you’ve heard of them. RFPs (Request for Proposal). And, chances are, you’ve participated in one, answered one, and, god forbid, crafted one. I consider them to be the “Goose that Laid the Golden Egg” for companies; they keep on giving and giving. Endlessly.

The premise of the RFP:

1) You get an RFP from a prospective client. A business-orientated tome full of hypothetical questions.

2) The business requests you answer a complete litany and barrage of questions as to how you would go about marketing and strategizing for (hypothetically, of course):

a. A particular line of products the company is thinking about launching
b. The company itself (my personal favorite).
c. Analyzing their current marketing strategy, and what your company would do to improve upon it

3) After spending considerable, and exhausting hours, delving in your own company’s products and services, you send it back to the prospective client in the hopes they will choose you to implement the marketing strategy you put together.

Why the RFP Must be Banished

The three points above are overly-simplified. The questions in these RFPs are very specific to the given client requesting it, and ask for data that takes a good bit of research to speak intelligently to. For example (completely fictitious question):

“We are thinking of offering consumers in Region Z our Blue Widget product, previously unavailable to them. What types of demographics are most apt to purchase our product? What type of marketing strategy is needed to make this effort profitable and capture the demographic?”

That’s just ONE question. There are likely to be several questions that go that in-depth. Right there we’re talking numerous hours of research to find out about the primary demographic that would most likely purchase the widget. Add on top of that the hours it’s going to take to craft a specific marketing strategy to sell a blue widget. Ridiculous.

Oh, and did I forget to mention that all of this is FREE OF CHARGE? That’s right, it’s free. It’s for the opportunity to put YOUR OWN PLAN OF ACTION into action. Brilliant. So, let me get this straight: I get to waste dozens and dozens of man-hours and create a hypothetical marketing strategy, all for the opportunity to put my own plan into action? Awesome.

What happens if they decide to go with another RFP from another business? Well, you’re SOL. All that research and data and strategy wasted. Not so. Nothing is stopping the requesting company from integrating your ideas into the RFP they chose. Not a thing. Moreover, the requesting company might choose not to pick anyone at all. They might just withdraw all offers and sit on it.

Right. This company just swindled (yes, that’s what they did), in some cases, $20,000+ of free research and strategy, for nothing but the promise of opportunity.

How To Stop The RFP Madness:

Businesses should simply refuse to participate in the process. Send it back with a big “NO THANKS” stapled to the front of RFP. If more businesses decided to spend the time and man-hours working on actual clients, they’d be more profitable. It might even send the message that the “free lunch” is over. Or secondarily, just bullshit the answers. Have fun with it. Get Socratic with it. Answer their questions with more questions.

If these companies weren’t getting anything valuable from it, then they’d stop sending them. They’d actually have to meet with a company, face to face, and discuss actual issues that need actual resolutions. And, they might actually have to pay to have that research done. Weird.

I, for one, am saying no to the RFP.

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1 Comment
  1. Oct 2 2008

    I am thinking of buying my wife of 17 years a car. I am confounded by the options and such. My budget is decent, although I don’t want to go “overboard”. About her: she is a college educated, white, suburban mother of five. About me: I am a white collar professional who likes 70s hard rock. My favorite color is blue. Her favorite color is violet. She also likes her coffee with a spot of sugar (never sweetener). We live in a tri-level home in the burbs and have 1 dog. We both enjoy reading.

    Given the “givens” upthread, what import should I purchase for her? Why that particular car? Why not the others? How many miles is she likely to drive per week, month, and quarter? Please predict the open market cost per barrel, as well as elucidate the ramifications of a bombing of Iran by Israel on the price of oil and hence you projections on the cost of unleaded gas, on a per octane/reformulate-basis) and tell me how much I can expect to spend on fuel, as well as how many pages are in the driver’s manual of each model considered. Oh, and also, please include the domestic content in dollars as a percentage of the total cost to manufacture and ship the car.

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