#20 - The hidden reasons your 'best-in-class' vendor is failing you

Last week I attended the MPE conference in Berlin. Like every year, it’s been a ton of fun and I had a lot of interesting conversations with old colleagues and friends.

But one conversation that stuck with me most was during a roundtable I hosted between both fraud vendors and their buyers.

At a certain point in the conversation, one of the merchants said this:

“We’re working with one of the leading fraud prevention brands out there, we pay them top dollar, but I feel like we don’t know how to exploit even 10% of their platform. Bottom-line, we’re really unhappy with the performance.”

This really struck a chord with me, as I’ve heard it many times in the past from clients myself.

What’s most frustrating about this situation is that you are already working with one of the best, and so it seems like you’re really out of options.

Today, I’d like to explore how such situations come to be, and what you can do to avoid them.

How do best-in-class solutions underperform?

Many times we tend to pick vendors that are the leading brands in their industry for a simple reason - the fear of f’ing up.

Ever heard the saying: “No one has ever been fired for picking Oracle?”

So here we are.

But still, this doesn’t explain how these seemingly best-in-class solutions end up failing us.

In my experience, there can be several factors that come into play which you want to be aware of before you make a buy decision.

Your own “value” as a client

The thing with best-in-class players is that they usually win best-in-class clients themselves. In fact, that’s what mainly drives their own brand value.

The problem is that as a client, you now need to compete for attention with the rest of the pack. And the sad truth is that vendors would usually prioritize support to larger accounts with bigger brand recognition.

This is always the case, but it gets worse the bigger your vendor is.

And that was indeed part of the issue with the merchant that spoke at my roundtable: they weren’t a small merchant by any means. In fact, mid-sized vendors would have probably considered them a logo merchant.

But with their own vendor, they didn’t manage to squeeze into the top client bracket.

(Lack of) geographic presence

Another thing that surfaced between the lines, was that the merchant wasn’t even able to get a meeting with their account manager for the better part of a year.

Now you might think this extremely unprofessional in a B2B environment, but it’s actually more common than you might think.

But there’s another thing at play here, other than the client’s account size. It’s also the resources that the vendor has for managing their accounts.

The merchant in question was headquartered in Europe. The vendor? In the US.

That’s quite a normal setup, but one thing that I feel is being overlooked is the actual presence of the vendor in your geographic region.

The fact a vendor is US-based doesn’t necessarily mean they don’t have support capabilities in other regions. But this needs to be assessed in advance.

If your entire region is managed by a couple of AMs that have very little attention themselves from HQ, no wonder you’re getting little attention yourself.

Contracting a big vendor can be very misleading in that way, as I often see they are able to sell outside of their core region based on their brand strength, but they don’t always bother with establishing the support capabilities to follow through.

Product-market fit

We tend to assume that best-in-class solutions have a very tight product-market fit. And generally speaking, that’s almost always indeed the case.

The thing is, like with any business, that doesn’t stop them from selling outside of that core focus.

In fact, with strong brands, it’s even a bigger problem, as buyers tend to get blinded by the brand reputation and assume that the vendor’s product-market fit will apply to them as well.

In reality though, I’ve seen plenty of examples where this wasn’t the case.

If you’re a top client yourself, that might not be a problem for you. Being big enough will always get you the attention and customization you require.

But what if you’re not a top-tier client for the vendor?

What if you’re located in a region with limited business support?

Does that mean that you automatically need to disqualify the idea of working with that vendor? No. But you want to make sure you have a very strong fit.

If you have a strong fit, the vendor’s roadmap and new features will serve you anyway. Maybe you’ll not get the individual attention you need, but you’ll still be able to benefit from their service.

How to avoid these traps

I always say that vendor selection is an individual and unique process each and every time.

If you’re worried you might be blinded by a big brand, here are the things to consider while you assess such a partnership:

1. Determine in writing what is the level of business support you’re expected to get after go-live.

2. If you’re based outside of the vendor’s core market, inquire how many “boots on the ground” the vendor has in your location. If it’s just a handful of folks, take that as a red flag.

3. Look at the vendor’s website and go through their logo clients, case studies, and other publications. If these are very similar businesses to your own, that’s a good sign. But if they are in totally different verticals, tread carefully.

Following these steps might not guarantee your performance will be according to your expectations at all times, but it will surely increase the chance of it.

Have questions or feedback? Reply to this email, I read all messages.

In the meantime, that’s all for this week.

See you next Saturday.

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