As we age, we are taught that there are two types of people, winners and losers. We learn it whenever we play or involved with athletics.
We learn it in business, especially sales. We learn it with today’s gamification – I mean there is only one person at the top, the rest are beneath them.
Society identifies and recognizes the winners. Those who are not at the top, well, society recognizes them as well, but not necessarily in a good way.
I mention this, because in the e-learning world, there are winners and losers, albeit we do not call the vendors who lose out to a deal with a customer or an opportunity, losers. Not publicly at least.
Sure there is no way everyone can win, and definitely no way at least in the e-learning space whereas someone wines every single time. But make no mistake, one vendor is going to win and one or many will not.
Within the deep inner sanctum of the LMS space, there is an unwritten and unsaid notion that no consumer, regardless if they are looking for a system or already an actual client, wants to be listed as.
High maintenance. Being put into that category is equivalent to being identified as a leper. Despite the size of the industry, word does get around – with many vendors, not all mind you, but many.
If you are seeking a system, high maintenance usually scares vendors off. Even if they are winning the pack of others, once they view the prospect as high maintenance, then there is an increased probability that they will back out.
But as a prospect you will get tagged with the high maintenance badge and they can expect others to politely decline or charge them rates whereas in other cases they might lower it.
How do you get to be high maintenance?
- You string the vendor along – you say one thing, the vendor does it, then you say another thing, the vendor does it, then you won’t commit and the vendor realizes that it isn’t about the product, it is about not closing the deal – they are just part of a cycle
- You can’t make up your mind – at some point you have to pull the lever and select. I see consumers who narrow it down, then decide we need more vendors to consider.
If you are in the final stages, then decide, wait, I want more – then you haven’t done your due diligence, you haven’t or really won’t pull that lever – you always believe something else is out there, is better and your missing out.
- Repeat, repeat and repeat – You invariably go the washing machine route. Repeat, rinse and repeat again. Similar to not pulling the lever. It is a never ending circle. I see this a lot with procurement.
Listen no one is going to give you $1 a seat, unless you are plus 1M users. Take the deal and move on. This isn’t “let’s make a deal”, where you wear a stupid looking costume, plead to Monty Hall (RIP), and wish dear old relative helps you out here.
If you do not think it happens, think again.
It would be nice and easy to say to high maintenance customer, “we are not a good match”, and that does occur, but there are an equal number of vendors who stipulate a wide range of reasons, which if you are dubbed high maintenance, isn’t accurate.
High Anxiety – no, wait, I meant High Maintenance Customer Style
If you are already a customer of said vendor and are dubbed internally as high maintenance, the vendor will cringe each time you reach out to them.
There are times we it is legitimate, maybe something isn’t working or a bug is showing up, but if it is for little items and you want a lot of hand holding, expect an internal reputation of high maintenance.
The vendor isn’t going to drop you nor not help you, they will. However, the term places you in a status that no one ever wants. Loser.
There isn’t an actual category, nor a listing of clients that when the call or email comes through, people look up and say, “no, no”, rather, they just sigh and know it is going to be something.
Vendor is in the house
You get the bid. You decide to complete the bid, even if you know deep down that it has been sent out to lots of vendors. Or you realize that what they are asking for is not something you have or want to do. But, you can’t say no. You have to do it.
Because, well, it is like the lottery – that slim, ever so slim chance, you might win it.
Sorry to tell you this, but if you know that it probability of you winning it is really slim, you have entered the loser category.
Yes, you are a loser. Why?
As the vendor
You are willing to spend a lot of time, completing this RFI/RFP, responding to – in some cases – more than 25 pages of this and that; willing to answer perhaps a litany of questions and the pricing – oh that price.
Not in the range – your out.
And before you say to me, well there isn’t a way to tell, let me retort by saying – if you have received more than 20 of these things in the course of doing business, you will start to see trends.
Handled more than 100, it is more than trend, it is intuition.
And if your mind is saying one thing, trust me, the mind is usually right.
Unless of course it is a piece of chocolate cake – and even you shouldn’t eat it, and your mind says don’t – your brain in this case is wrong. “Shut up, brain!”
Think of a poker game. Some people are really good at bluffing and hiding what they have, others give off a “tell”.
These are some of the “tells”
- The vertical – Education – cheap. They want low price. Regardless if it is K-12 or higher education.
- Other verticals – Government. Low cost shoppers.
- Fortune 500, even Global 2000 customers – Even worse, big and well known name – they will want a low price. I’m referring to customers who go directly to the vendor(s) themselves, rather than hiring a third party or intermediary to negotiate the best deal possible.
I know of vendors who have lost money, been in the negative as we say, to land that well known customer.
Worse, they may not be the “exclusive”. Which means, they are not the only vendor with that company.
But they want that “name”. Wait, it gets even better or worse, depending on your take.
I know of “big name, well known” customers who will not allow the vendor to mention their name in any forms of marketing. Nothing public as they say. So, while the vendor wins, they really lose.
- Non-profits – They seek a discount. Again, this is where the customer goes/sends an RFP directly to the vendor.
- Certain countries/regions where the economy is poor, or the recession is still in play or the country(ies) themselves are new to the e-learning space. Sometimes if you want in, you have to lower that price big time.
- 500 or less users – Lately, I’m seeing it in the 500 to 999 category; at the high levels: 50,000+. Land in the 1M or higher – better enjoy going a couple of dollars per seat or less. Surprisingly, at 10,000 to 25,000 – the cost per seat can still go higher than the common range. Why? People are not aware.
- The customer themselves – A smart salesperson can tell over the phone (if they talk to the customer multiple times), what the person’s knowledge and experience is – how tough will they be – makes a huge difference in the price wars
- B2B/B2C – More cases than not, they do not have the cash flow upfront – and that makes sense.
Just because society dedicates that there can be only one winner.
Doesn’t mean, the e-learning industry has to follow.
This isn’t a game. This isn’t a battle.
This is the real world.
Where we all share something in common.
One day we will win. On another day we will lose.
But together there is a bond that binds all of us.
Winning isn’t everything.
Nor is it the only thing.
Really great post Craig – gives us all a lot to think about. Reminds of the difference between relationships where the one party wants to be the winner and that means the other party is the loser – vs when both parties realize that for it to work – both will win (and there is some give and take).
Great article. Really enjoyed the part about vendors starting to get through 20+ RFPs before they start seeing trends – I know from a consultants perspective, I definitely see that trend!
However I can’t help thinking that vendors cannot discuss prospective clients due to confidentiality, and therefore I wonder whether ‘high-maintenance’ clients actually do get branded that way, or whether they are free to roam and cause the same damage elsewhere?
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