In some ways, procurement is a lot like sales and marketing. The stereotypes for the role, defined by an increasing minority of individuals, colors perceptions, devalues the majority, and creates missed opportunities. For any company with multiple products that should appeal to the same company, procurement should be a key part of your account based marketing strategy. Marketing should be including them in campaigns and sales should be developing relationships with them. Here’s why.
In our most recent buying survey (several research notes about to publish for clients), we worked to understand the overall volume of buying situations in companies (more on this in later posts). One “jump off the page” finding, that is somewhat obvious in hindsight–but rarely top of mind, is that respondents in procurement roles have the most visibility into buying efforts for technology in the company.
When your biggest competition is often competing priorities, procurement can help you understand what else is going on. They can also help you connect your effort to other strategic initiatives. Finally, nearly half of all buying efforts are ad hoc—building a relationship with procurement can help them be aware of your company and help you get considered.
What does it take to get noticed by procurement (in a good way)? Again, the stereotypical answer would be ‘have a low price,’ but that misses the mark today. The respondents in our study clearly show they are looking for partners more than vendors. They value collaboration and quality service/support. The want risk mitigated innovation. Price was the least important criteria for procurement (just like other roles). I’m not saying price doesn’t matter or that procurement won’t work hard to get the best price possible for their organization. I am saying that there are signs that they won’t sacrifice potential value for price. Your negotiation stance needs to be built around what is needed to deliver the value desired to defend your price.
There are some things that our procurement respondents indicated would cause them to advocate for rejecting a vendor. The top five:
- Confusing/Contradictory Material
- Negative Opinions from Analysts and Influencers
- Capabilities that Don’t Meet Requirements
- Aggressive Sales Tactics/Ineffective Sales Teams
- Prices Not In Line with Expectations (often with issues being restrictive models or term changes being the key factors)
Finally, procurement respondents were most open to engaging with sales teams after they have done their initial research.
The net of all this: If you are a vendor committed to value, with a diverse product line, then you should not view procurement as the enemy–they could be your best friend. Approach them with a desired to build a collaborative relationship built around value to your customer. It could pay big dividends.