I have yet to meet an agency that doesn’t want to provide the maximum value it can to its clients.
Most of us set up a business because we believe there is a better way of serving a market, so giving value is firmly rooted in our DNA.
We want to deliver a great service because seeing results for your clients, and getting positive feedback from them, is what makes us feel better than anything else. When you do that you increase retention of clients, their spend with you, get referrals, have a happier workforce and generally feel like you have something that can scale.
Giving value is not enough to scale
Giving value is not enough, you need to be receiving value back.
It’s no good if your clients think you’re the best thing ever to happen to them but you’re broke.
The value exchange has to be two way for your business to thrive. The vital ingredient for receiving value back is profitability. You can’t build a business without it. If your client is losing you money then no matter how good everything else is, you can’t sustain that relationship.
Best and worse clients
In order to achieve that two-way value exchange, you need to find the win-win relationships in your client base. When you think of your best and worse clients you probably think in terms of how much they value what you do.
The best ones are constantly thanking you and telling you how pleased they are with your service. The worse ones are regularly complaining, asking for more, but complaining about the price.
When you think about those best clients, are they really the best for you in terms of the two-way value exchange described above? In my experience, the best clients value you so much that they gradually take a stranglehold of your team.
They have your mobile numbers in their phone book and don’t think twice about disturbing you in the evenings and at weekends. They add you into their slack channels and expect almost instant responses.
They praise what a great job you’ve done and swiftly follow up with a request of “if you could just…”. They expect you to travel out and see them and for you to fund the cost.
They want to be able to come and see you whenever they like, again using your time without paying for it. These clients win because they get everything they want from your relationship. They have the experience and skills of an in-house team at their fingertips but without the stress and cost. You’ve taken that on for them! You will likely make very little profit on these clients.
The clients at the bottom of the list are those that however hard you try, never seem to be pleased. They ask for more from you but complain about the cost. They pick at the niggly issued and quickly forget about the more impactful things that you’ve delivered to them.
Instead of focusing on ROI/outcomes, they are bogging you and themselves down by analysing the time you’ve spent and the inputs.
They are not satisfied that they are getting what they paid for and you are losing money by continuing with them as a client.
The win-win clients
These are usually found somewhere in the middle of your best and worse clients. They are pleased that what they receive from you is value for the money they spend.
They thank you for doing a good job and see your role in their bigger picture. They have shared expectations with you about what should be delivered for the fees they pay and they don’t try to squeeze you for everything they can. They are therefore profitable, durable and enjoyable to work with.
These are the clients that make you a healthy profit but you are not delivering results for them. They don’t complain too much yet but at some point, they will become aware that they are not getting a good deal and will quickly move into one of the categories above.
Whatever size your agency, it’s likely that you will have clients in all three of the main categories. Your goal is to morph your client base into Win-Win only clients.
What to do about it
The Lose-Win clients are usually capable of being Win-Win clients. It is often our own doing that they have become too demanding because we’ve not set the boundaries of the relationship.
By taking ownership of the problem, you can apologise for not being clearer on how they should best interact with your team. Approaching it this way builds trust and openness as most of those clients want to be good clients and have a healthy two-way relationship and they will when they are shown how.
Be very careful not to talk about the need to “have time to service other clients” as the reason why you’re addressing the relationship. They don’t care about your other clients.
They want to feel cared for, like you’re determined to get results together with them, almost like they are you’re only client. They just need educating on where the goalposts are so that they can play fairly.
If they want more than you are currently charging for, and you are happy to do the things they ask, then quote for it. Give them a quote for keeping the service the same (at an increased price) and a quote for keeping the price the same (with reduced services) and they have options.
This is really important because your clients don’t want to feel forced into paying more, so give them the option to keep paying the same, but with clear boundaries.
The Lose-Lose clients are very rarely capable of becoming Win-Win clients. They have to improve the way they work with you AND pay more. If they’ve been difficult so far it is unlikely they are going to change and even more unlikely that they will pay the increased fee.
People talk about “sacking” your worse clients but I find that dis-respectful and uncomfortable. It’s much more amicable for you both if you can help to direct them to another service provider who better spots their needs – a smaller agency, freelancer, perhaps a specialist in their industry.
Before you refer them elsewhere, there is nothing to be lost in sending them a proposal that represents how you need things to work. If they accept then you have new guidelines and a price that gives you what you need to make it work.
If they don’t then you positively refer them to the other provider, not by apologising but by enthusiastically explaining to them that you have a better option for them with a provider that you can endorse.
Building an agency by design and not default
Most agencies are started by a designer/developer/marketer who is good at what they do and go out alone. You start to win clients and take on staff and before you know it you have a growing business. The problem is that the more you take on the more you need.
The more clients you have, the more staff you need and then the more stuff you take on, the more you rely on keeping and winning clients. If you don’t design the agency to be the one you want, you will end up growing by default – and that compromise in quality of clients and staff will lead to frustration and burnout.
Building an agency by design means figuring out what type of clients you want, what price they will pay, what you want them to buy, how you will attract them with your marketing, the type of people that you want to work for you, what values you will run the business by, how you will deliver the work efficiently and profitably, etc.
In a word, this is simply what strategy is – designing your dream agency and then going and building it.
Once you’re clear on what you want, everything else has to go. If you don’t make the difficult decisions now, they only get harder and cause you more problems.
It starts now
Our MAPPING session involves a full review of your existing client base where we grade them according to agreed criteria and create a plan for cleansing and improving that list over a defined time period.
Book your discovery call to find out more and meet a member of the MAP team.