Chicago,泭September 12, 2019泭 Researchers from Clemson University and University of Kentucky published a new paper in the泭Journal of Marketing, which泭examines泭several means by which suppliers can enhance their competitiveness when selling to barricaded buyers. 泭
The study, forthcoming in the November issue of the泭Journal of Marketing, 勳莽泭喧勳喧梭梗餃泭 and authored by Kevin Chase and Brian Murtha.泭
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To ensure fair and competitive purchase processes, most states and many leading organizations limit the amount of contact suppliers have with buying team members once RFPs are released. Accordingly, the researchers refer to these buyers as barricaded buyers because it is difficult for suppliers to communicate with them. How can suppliers effectively sell to buyers who are sheltered by these barricades?
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In the typical RFP process, there are fewer restrictions placed on communicating with buyers during the development of the RFP (i.e., the pre-RFP phase). In this phase, buyers involve suppliers to help clarify their needs so they can develop泭more appropriate RFP specifications. One frequent and efficient way to involve suppliers is commonly referred泭to as a pre-RFP meeting. These meetings (some of which require attendance) bring together competing suppliers who participate in facilities walk-throughs, inspections, and clarifying Q&A sessions. Chase explains that We discovered that while some suppliers remained silent during these meetings, other suppliers took the opportunity to engage in what we call peacocking behavior. Peacocking is when a supplier signals or shows off the strength of its knowledge泭about,泭or its connections to individuals within, the buying firm. Our findings indicate that doing so can substantially demotivate ones competitors from responding to the buyers RFP.泭
In
addition to demotivating competitors through peacocking,
suppliers can demotivate competitors by embedding their unique
capabilities and language into buyers RFPs during the pre-RFP phase. To do so,
shrewd suppliers often shared facilitating documentation (e.g., marketing
materials or sample RFPs) that included their unique capabilities and language.
Buyers, some of whom had less experience developing RFPs, appreciated the help
and used suppliers facilitating documentation to help develop RFPs of their
own. Other suppliers were quick to notice the unique capabilities and language
of their competitors and lamented about the biased nature of the RFPs (whether
the bias was intended or not).
In the post-RFP phase (i.e., once the formal RFP is
released), buyer-supplier interactions are much more restricted. A common
approach to developing an RFP response was to meet requirements exactly as
requested. Buyers, however, often mentioned that the RFP requirements are
really just the minimum requirements. We discovered that more competitive
suppliers not only met the requirements of the RFPs, but also went above and
beyond the requirements in two critical waysby also providing innovative
solutions and/or by providing solutions buyers hadnt thought of. Doing so
signals to buyers a sincere effort by the supplier to claim their business and
that the supplier may provide additional value going forward in the
relationship, explains Murtha.
In addition to the solutions offered, the study shows
that buyers lean heavily on the subtle signals suppliers convey in their RFP
response documents. For instance, several suppliers were surprisingly
inattentive to the poor tone conveyed in their RFP responses and some used
canned responses not tailored to the RFPs buyer. Buyers quickly removed
such suppliers from their decision sets. Further, buyers paid particular
attention to the similarity of the references suppliers provided. Similar
references signaled the requisite experience and ability to handle the buyers
account; dissimilar references either triggered fears of supplier inability to
handle their account (when references were smaller or less prestigious) or
fears of inattentiveness to their account (when references were larger or more
prestigious).
Although price is certainly important when selling to
barricaded buyers, this research suggests its importance is largely situational,
ranging from zero percent (for some services) to 75 percent (for some
commodity products), with the average around 30 percent. As a result,
suppliers engaging in the barricaded buying process should acknowledge the
important role of price, but also the importance of these other strategies as ways
to enhance their competitiveness.
Full article and author contact information available at:
蹤獲扦夥厙t the Journal of Marketing
The泭Journal of Marketing泭develops and disseminates knowledge about real-world marketing questions useful to scholars, educators, managers, policy makers, consumers, and other societal stakeholders around the world.泭Published by the 蹤獲扦夥厙 since泭its泭founding in 1936,泭JM泭has played a significant role in shaping the content and boundaries of the marketing discipline. Christine Moorman (T. Austin Finch, Sr. Professor of Business Administration at泭the Fuqua School of Business, Duke University) serves as the current Editor in Chief.泭
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蹤獲扦夥厙t the 蹤獲扦夥厙 (蹤獲扦夥厙)
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