How to Run an In-Depth Win/Loss Analysis for RFPs
If you’re like the average proposal team, you might submit around 162 RFP responses per year—that’s almost three a week. 🤯 With a new request always waiting around the corner, it’s no wonder you’re short on time to reflect why you’re winning or losing.
But here’s the catch-22…
These insights are essential for running a successful RFP program. Only by intentionally tracking and analyzing bids can you better understand your customers (and precisely what they’re looking for), improve your RFP process, and ultimately, increase win rates.
In this article, you’ll learn how to conduct an in-depth win/loss analysis by following these steps:
What Exactly is a Win/Loss Analysis for RFPs?
A win/loss analysis evaluates why you’re successfully closing deals involving RFPs (and what’s holding you back from winning even more). Instead of making a wild guess, it allows you to methodically gather insights from RFP metrics and valuable buyer feedback that can help you make more informed go/no-go decisions and improve overall proposal performance.
Ready to face the facts? Download this win/loss analysis template to determine where your proposal team is doing well—and where you can improve. (Psst…you can successfully use this template by following the same steps below.)
3 Steps to Improve Proposals With Extensive Win/Loss Research
According to our research, the average RFP win rate is 44%. While most proposal teams win or lose half of their bids, pinpointing why can be a puzzle—if you don’t know where to look for the pieces. 🧩
Some say they lost because they were “no match for the incumbent.” Others credit the closed deal to an agreeable price.
…But the reasons are far more nuanced.
You could be wasting your time responding to RFPs that are not the right fit for your business. On the flip side, your highly-personalized proposals could be the secret to your success—giving buyers the warm and fuzzy feeling that you just get them.
So, how can you solve this mystery? 🕵️ Follow the steps in this win/loss analysis.
Step 1: Track Your Success Throughout the RFP Process
Most proposal teams know how to calculate a win rate to measure RFP success. After all, this metric answers the #1 question: What percent of your RFP responses result in a win? But it doesn’t tell the whole story.
As it happens, two other metrics indicate whether your RFP process is a revenue-generating machine—or a rewards roadblock:
Participation Rate (a.k.a Submission Rate)
Your participation rate is the percent of RFPs you respond to vs. received. This metric indicates whether your go/no-go decision criterion is on the right track—when you compare it to your win rate. For example, if you have a high participation rate but a low win rate, you may need to be more selective (responding to more RFPs isn’t always merrier).
Shortlist Rate (a.k.a Advancement Rate)
Your shortlist rate is the percent of RFP responses you’ve submitted that the buyers have shortlisted. This metric reflects more accurately on RFP quality than win rate alone. That’s because the buyer selected your company to move on to the next stage (typically a finalist presentation) simply by reading your proposal. A high shortlist rate is well-earned. 👏
Tracking this data over time and comparing it to industry benchmarks (in the table below) will help you identify where to make some RFP-altering improvements to win more.
|RFP Metric||The Global Average 🌎||If Lower, You May Need To…|
|Participation Rate||63%||Adjust your go/no-go criteria so it’s more flexible to meet revenue targets.|
|Shortlist Rate||55%||Focus on crafting strong win themes and customizing answers to the buyer.|
|Win Rate||44%||Align better with your sales team and rehearse your presentation more.|
Step 2: Calculate How Much You’re Making From RFPs
How much does it cost your organization to reply to an RFP? What’s your average return on investment (ROI)? These numbers are essential for your win/loss analysis because they help you plan a proposal budget and prioritize the most-lucrative RFPs.
Here are three different scenarios you might face when looking at these values (and the decisions you can make):
👎 Worst case scenario: If you have a low cost per bid and low win rate, don’t feel defeated. Perhaps your team needs additional support to be successful. So, consider making a business case for more resources.
👌 Base case scenario: If you have a low ROI, but high win rate, you may want to make bidding worth it by putting your time and materials into high-value RFPs. You’ve proven that you got what it takes to win, so go after the big money. 💰
🤘 Best case scenario: If you have a high ROI and high win rate, you’ve hit the jackpot. It’s time to scale your resource-efficient RFP program and generate even more revenue.
Step 3: Identify Your Top Reasons for Winning (or Losing)
What’s the best way to learn why you won or lost a bid? The answer: Ask the prospect.
Only by going straight to the source through a feedback interview can you discover their reasons for choosing your organization or not. Otherwise, your win/loss review will merely be speculation.
Of course, soliciting this information is easier said than done—especially when reaching out to someone who sent you an RFP letter of rejection. Unlike new customers who are happy to sing your praises, prospects who passed might not be open to spending more time with their second or third choice.
However, as the saying goes, “It never hurts to ask” (so long as the procurement legislation allows you to do so). If you have the green light, here’s how to appropriately gather feedback from a prospect:
✓ Be prompt: Reach out to the prospect while your proposal is still fresh in their mind. The more time that passes after receiving the rejection letter, the less likely they will say yes to a feedback interview because they would have already moved on.
✓ Explain the reason: Everyone likes to feel heard. Let the prospect know you’ll use their insights to improve your RFP response process and provide a more-tailored solution if the door reopens. They’ll appreciate (and remember) your strive for excellence.
✓ Come prepared with questions: A prospect who agrees to a feedback interview is sharing valuable time with you—don’t take it for granted. Show up with critical, open-ended questions that will help you get to the bottom of their decision.
✓ Show your appreciation: Always follow up the interview with a thoughtful thank-you email. A little appreciation goes a long way in showing prospects how well your company values its customers (even when they are not one yet).
Remember, you’ll need to hear from more than one prospect to determine why you tend to win or lose RFPs. You can sort through this qualitative data using a modified rainbow spreadsheet (a tool created by UX researchers) to track win/loss trends visually.
Steal These Questions for an Insightful Win/Loss Interview 📋
- What was your impression after reading our proposal?
- What did we do in the RFP process that you liked?
- How did you feel about our solution overall?
- At what point did you know we were (or weren’t) the right fit for you?
- Which alternative solution, if any, did you choose over ours?
- What was the biggest consideration for your decision?
- What’s one thing you’d advise us to change in our proposal?
💡 Pro tip: It’s also a good idea to ask your RFP team for feedback. They have a first-hand account of how the response process went and can offer valuable suggestions about what you can collectively do to increase that chance of winning next time.
Conducting a Win/Loss Review is Well Worth The Time In Your Proposal Process
If you’ve never conducted a win/loss analysis before, there’s truly no better time to start than now. It’s difficult to know where you have a competitive edge—and what’s holding you back—without having relevant, unbiased data to draw from.
Soon, you’ll have a better understanding of your ideal customer (and what they’re looking for in proposals), data-backed ways to increase your win rate, and an optimized response process.
Download Your Win/Loss Analysis Template
Find out why you’re really winning or losing RFPs.