What is Vendor Relationship Management?

Vendor Relationship Management is exactly what it sounds like – sourcing and management of relationships with vendors. When executed effectively, vendor relationship management can be the difference between a failed vendor relationship and the fostering of a longstanding strategic alliance to achieve an otherwise unachievable level of success together.

Each and every day I talk to business owners that outsource their Digital Marketing functions. Whether it be their SEO, PPC, or Social Media Management, more and more business owners are realizing that outsourcing is a great way to get the talent without having to pay for that full-time headcount.

On the flip side of that coin, I also talk each day with business owners that have no idea if the outsourced vendors they have chosen are actually doing a good job. These business owners rarely open their reports, and if they did they most likely would only have a basic understanding of what the reports were telling them much less if the strategy they are using is sound. They are also inundated daily with salespeople calling them to say their SEO is lacking, or their PPC is terrible. When you couple this with their busy schedule and lack of understanding it is easy to see how relationships are strained and vendors get replaced.

The majority of these miscommunications could be easily rectified if the business owner had a Vendor Relationship Management Partner in place. After all, If a business owner is going to bear the expense of Sourcing and Onboarding an Outsourced Digital Marketing service, doesn’t it make sense for that business owner to also bring on an advocate to professionally manage, assess, and audit that Vendor Relationship?

A seasoned Vendor Relationship Manager (VRM) with experience in all facets of Digital Marketing can assist the business owner not only in the day-to-day activities of managing their vendors but also in putting together the right strategic plan that will ensure success.

The VRM acts as a Chief Strategist, Chief Marketing Officer, and a Sourcing Manager for a fraction of the cost of employing these positions full-time. Their purpose is to make the contract as beneficial as possible to both the business owner and the vendor.

The VRM typically focus their attention on the Sourcing of new vendors and the Daily Relationship Management of contracted vendors.


The key to any successful relationship is to understand what you are getting and to set expectations. I can’t tell you how many companies fall short in choosing the right vendors or have a plan in place based on actual needs.

Many business owners try to find a single company to handle all of their Digital Marketing needs, but this oftentimes leads to failure. It is more advisable to hire the best fit for each type of Digital Marketing as you rarely find a company that is the best at all of them.

The Vendor selection should be driven largely by:

* Vendor Capabilities and Reputation

* The user experience (i.e., do they understand your customers)

* Operational requirements (who does what and when)

* Your long-term vision for your business

* Ease of integration with your system

* Ease of scalability

* Flexibility of pricing and terms

* Cultural Fit



Once a few potential Vendors have been chosen, the work begins. Contracts need to be reviewed and redlined, and expectations need to be defined before making a final decision. Once that decision has been made, and contracted, the relationship management phase begins.

The key components to successfully onboard and manage the Vendor are:

* Strategic Planning

* Goal Setting

* Identify and track KPI’s

* Communication

* Performance review

* Contract Compliance

* New Vendor Vetting

In conclusion, I know that successful vendor relationships are not driven by contracts and handshakes. They are built on consistent relationship processes. It is important to work with customer-focused vendors who are willing to work collaboratively on a win-win model and not just put you on a canned plan of services. A professional Vendor Relationship Manager can assist with this.

If you are a business owner that currently outsources components of your Digital Marketing or are looking to do so, we would love the opportunity to discuss our services with you. We have over 12 years of Digital Marketing experience and over 20 years of experience in Vendor Relationship Management. You may schedule a meeting by selecting Interact with us.

If you are a Digital Marketing professional that offers exceptional service to Business Owners, we would like to offer you the ability to work with our clients. You can register as a Vendor on this site.

- Chuck