If you are a web analytics manager or a senior web analyst then one of your job responsibilities is to negotiate analytics contracts. Like any other technology vendor contracts, the web analytics contract contains a multiple level of intricacies. Some of the technical jargons make it really hard to sign a good contract.
In this post, I am going to provide 5 powerful tips to pull a winning contract and become a hero in your organization. These tips are time tested and proven to work. I have personally used them to significantly reduce our enterprise analytics software cost and get more value add services on top of it.
#1. Request for Proposal (RFP) to multiple vendors
Always make sure to send out the request for proposal to multiple vendors. Getting multiple vendors to compete with each other puts you in the driver seat of negotiating the contract. You can use one contract to negotiate the terms on others. I would even inform each vendor that you have sent out RFPs to multiple vendors.
#2. Server calls
Even if you are a killer ninja negotiator, and you feel you have negotiated a low price contract for your organization. This still does not guarantee you will be paying less.
One of the most important line items of the web analytics contracts is the annual server calls volume. Your analytics account manager / sales rep may try to convince you for a lower server call volume so don’t book yourself weak. I use a “5x rule of thumb” to calculate the forecasted server calls volume because it allows you to scale easily. Here is the formula –
New Contract Annual Server Call Volume =
Total server calls for the highest traffic month in last three years (traffic from all tagged sections of your website and campaigns) x 5 x 12
You could definitely go higher than 5x multiple, but you should never go lower than that.
#3. Length of the contract
The length of the contract is another lever that your vendor could use to charge more money. As a best practice you should always sign only a 12 month long contract, unless it’s free. 🙂
If you are concerned that you could lose money if the web analytics package prices go up then let me assure you that the prices of basic web analytics software are forecasted to go down. The reason behind is the increase in competition and exponential growth of the free Google Analytics solution.
Additionally, short term contracts allow you to shop around for better and more powerful solutions.
#4. Support hours
This is the most interesting piece of your analytics contract. You could pay a ton of money unknowingly for small issues like an account reset or lost password. Always negotiate to get free support if not then atleast try to get 10 hours of free support each month.
#5. Implementation & User Training
Most enterprise level analytics implementation and integrations are complicated. Your analytics vendor may charge you extra for new integrations or implementations. Always ask your vendor to train your web developers on web analytics implementations.
Lastly, negotiate a free live training package for all the web analyst in your organization.
In most medium to large business organizations, contract negotiation is done by procurement. If this applies to your organization then you can provide these tips to your procurement manager.
Hope you enjoyed this post. Please share your thoughts, insights and comments because it really helps me write more effectively.
Here is a list of other helpful blog posts –
5 Web Analytics Predictions for 2010 and Beyond
Troubleshooting Website Traffic drop with Web Analytics
Top 5 Coolest Web Analytics iPhone Apps