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Tennessee’s four-tiered procurement method helped bring in an estimated $1 billion in increased tourism spending and could be used by any state willing to step away from traditional Request for Proposal models.
In 2013, with a renewed emphasis on bolstering the state’s tourism industry, Tennessee leaders began a procurement process to secure new advertising services. The innovative process serves as a model of modern procurement, and can be easily replicated by other states.
As a result of the services provided by the new vender, as well as other activities, Tennessee generated an estimated $1 billion in increased tourism spending from 2013 to 2014. And, one of the ad campaigns that resulted from the procurement received the advertising industry’s prestigious Cannes Lion award. Tennessee is the first state to ever receive this award.
The primary objective was to procure best-in-class marketing and advertising services for the Tennessee. The firm would be charged with modernizing the state’s marketing and advertising campaigns by utilizing current technology, such as social media, to drive interest and tourism from around the world.
The second objective was to use a procurement method that would ensure that the awarded contractor was highly qualified, while still allowing cost to be a factor in determining the award. This was the first time the state had altered its request for proposals process and incorporated a four-tiered approach to determine the successful vendor:
Evaluate RFP Mandatory Requirements on a pass/fail basis. Respondents were required to meet ten (10) requirements in order to continue to Tier 2.
Those who passed the Tier 1 evaluation were invited to make oral presentations. The state applied a standard equitable evaluation model, which included a qualitative assessment of each respondent’s technical proposal and included information from the oral presentation.
One of the most innovative parts of the process was that the state included tourism outside subject matter experts (SMEs) in the presentations; the SMEs provided written reports to the evaluators.
The state prohibited proposers from providing a Tennessee-specific campaign; instead, it requested that proposers provide examples of campaigns they had completed within the previous two (2) years. Proposers were also asked to create a mock campaign for a fictitious brand to illustrate their creativity. This process reduced the risk of a losing respondent claiming that the idea for a future concept or campaign emanated from their proposal.
Following Tier 2 evaluations, the state held interviews with the top three technically evaluated respondents, who were asked a series of questions that were used to provide a more in-depth understanding of the firm’s ability to perform the full scope of the contract. The state utilized a “Super Group” of three SMEs, who were different than the original SMEs. This group consisted of the three most influential people in the state’s tourism industry.
Following the Tier 3 evaluation, the state opened only the top technically ranked cost proposals and engaged only those respondents in cost negotiations.
This process was a key step to ensuring that the state received the best value for its money. By moving the top three respondents forward for further evaluation prior to opening costs, the state guaranteed the awarded firm would be well qualified.
The state completed its evaluation process using a panel of five evaluators. All evaluators were state employee marketing directors from various agencies that are stakeholders for
Tennessee tourism. Including the Department of Economic and Community Development, State Parks, and the Department of Transportation.
In the process, the state consolidated its previous multiple tourism advertising and marketing services into one contract. As a result, the State has reduced the amount of time dedicated to contract management and oversight and 2) ensured consistency of the campaign across multiple media formats.
In 2013, Tennessee had an aggregate of 96.4 million visitors. Upon execution of this contract in 2014, Tennessee experienced a 5.1 percent increase in tourists for a total of 101.3 million travelers. During this same period, the national average growth in tourism was 4.4 percent. This growth resulted in more than 1 billion dollars in additional revenue to the State’s tourism industry.
This procurement, which has been recognized with the 2015 George Cronin Award for Procurement Excellence by the National Association of State Procurement Officials, has set the standard for marketing and advertising procurements through the use of Industry SMEs, various stakeholders participating as evaluators, and is a process that can be easily emulated or replicated.
Utilizing the expertise of the public and private sector stakeholders is something that any state can do to further their own tourist development initiatives. And, Tennessee’s four-tiered procurement method could be used by any state that is willing to step away from traditional Request for Proposal models.
DeLaine Bender is the Executive Director of the National Association of State Procurement Officials.