Lots of articles have been written about the steps to plan a migration to a new Email Sending Platform (ESP) or other Marketing Tool, so this article is not about that. It is about negotiation.
Crises like our current situation with COVID 19 provide the perfect cover for you to do hardline negotiation with your ESP contract renewal — or to switch to a new one. Some might say that COVID isn’t just providing cover, it’s creating NECESSITY to negotiate. There are three advantageous negotiating positions to consider: Re-assessing your needs; Fiscal tightening; Competitive bidding.
Re-assessing Your Needs Should Always Be Your First Step
Before embarking on any renewal or migration project, take a hard look at your existing email marketing programs for possible economies. Usually in email marketing, the more stuff you use, the more money you spend:
- Check to see if there are contacts you can sunset due to lack of engagement (ie haven’t engaged in last 12-18 months)
- Look at email creatives or templates that are not performing
- See if there are landing pages or templates not converting leads or sales
- Delve into deliverability problems (ask vendor what is needed to mitigate); they may suggest dedicated IP or other things that will add and not take away cost, but may be needed
- Are you paying for reporting or analytics features you are not using?
- Are you paying for segmentation, personalization or nurturing features you’re not using?
If you can remove contacts that are non-performing, creative that is not working and stop paying for features you are not using, you’ll instantly save on your next renewal or migration. But do not stop there. Negotiate hard from a position of buyer strength during the economic downturn.
Negotiate from a Position of Buyer Strength During the COVID Economic Downturn
Start your negotiations knowing you sit in a position of strength. The ESPs are seeing dozens if not hundreds of customers drop their service or service levels; most of them are laying off employees and are hating it; and they definitely DO NOT want to lose you.
But it is up to you to tell them you are not rolling over on the renewal, and that you want them to show you their best numbers. And even when they show you their best numbers, be skeptical and hard pressing. Tell them you want them to work harder, and that your company is facing a hard quarter (it likely is); and that the boss is looking over your shoulder (they are). Also, a little hint: keep inching your negotiations closer to the end of the month, and even better to the end of the quarter. Sales organizations live and die by their monthly and quarterly sales numbers, and they will fall on even sharper swords at those crucial times to make a deal. Take full advantage of that.
Make sure you are bidding apples to apples. Not bananas to gorillas. One technique that is very sneaky among ESPs is how they package their pricing into bundles, so that it is hard to find bidding equivalency among them. Do not let them do it. Make them tell you their pricing in your terms. Give them your bidding criteria, ie X # annual email sends, X # of email creatives, X # of landing pages, X # of contacts hosted, segmentation criteria, etc. Then create a spreadsheet or a grid and then cost comparisons become easy.
TIP: If you’re a non-profit, ask for their non-profit rate. Some offer a 10-15% discount. Others will honor that if they know the other guy is offering it.
They Expect Competitive Bidding, So Do Not Disappoint Them
Once they have provided their pricing, pit them against each other. Don’t show them your grid, but tell them the price you want them to meet. If the sales rep is having trouble getting his boss to swallow it, then you can forward the bid from the competitor to them. That will usually do it. And when you have one or two vendors of equivalent capabilities and pricing narrowed down, tell them you are having trouble making a decision and a further 10% discount would tip the scale.
What to Do When Your ESP Contract Is Settled and You’ve Moved In?
In our experience, once you have your ESP in place and deliverability is acceptable, the one thing that makes the biggest impact on improving email performance is the list, offer and the copy, in that order. The list is a foundational issue of instituting a good opt-in system, welcome email and a plan for engaging emails throughout the lifecycle of a subscriber. The offer is the product or the content … is it what people want? But very importantly are you describing them in a way that motivates people to read and act? We have worked on email marketing campaigns for more than 100 companies. Re-writing their sales, prospect and nurture campaigns made the biggest material difference in improving their campaign’s performance. Invest in good copy. Do not make it the last item in the production line that isn’t given enough time to do it or your customer justice. Negotiate hard with yourself on that one, and it will pay out spades in the future.
By Laurie Beasley
Co-Founder and President
Beasley Direct and Online Marketing, Inc.
Need help with your next email marketing campaign? Contact Beasley Direct and Online Marketing, Inc., for an assessment of your campaigns and how we can help.