Here’s how it works. Someone wants to set up a real estate office and register as a buyer. If they needed a 10-module computer system, they could visit the buying guide and learn such basics as why they need a modem and what a hard drive is. “We assume they don’t know shit about the category,” explains Louvat. “A lot of small-business owners are not tech savvy.”
Next the small-business owner fills out a request for proposal, or RFP, indicating preferences such as the number of computers, technical specifications, and software they will need. That request is then emailed automatically to all the registered vendors whose sales parameters match the criteria. For example, a vendor who only wanted to be notified of orders larger than a dozen units would not receive notification of the 10-unit request.
Brandon Grieve, a sales representative for Primary Network, the largest Internet service provider in Missouri, estimates that within six weeks of joining up with he was getting a new business lead every 15 minutes. Because of the “filter” he had created by setting parameters that eliminated smaller customers, he could respond to 75 percent of them. Of those, 3 to 5 percent become customers.
In the past Grieve’s job involved a lot of tedious and largely unproductive cold-calling. “Customers come to you wanting service, and they are prequalified,” explains Grieve. “You know exactly what they want and what their needs are. It’s obviously a lot easier to deal with someone who has requested your service rather than you calling on them. They really have thought of how we do business.”
So as not to overwhelm buyers, only the first five quotes to arrive are forwarded to the customer. Then allows the customer to comparison shop by creating a page that lines up the bids side-by-side. To complete the transaction, the buyer contacts the winning vendor by phone or email. “It’s a blind auction; the vendors can’t see each other’s bids,” explains Louvat. “We’re going to keep fine-tuning how this interaction happens. It’s possible we will have multiple rounds of bidding a year from now.”