Sometimes it’s better for an agency to just say NO to new business!
There are times in every agency owner’s life that a prospect comes in and forces a gut check: “Are we this sort of agency?” Every agency leader wonders where to draw the line. Nothing will stop the upward trend of a creative shop faster than a soul-sucking client. All the energy, all the joy of doing great work, will stop. No matter how desperate the agency is for new business, there are some clients you have to say, “No thank you” and just walk away. Better to live and fight another day.
Six clues it’s time to walk away from a prospect and say no to new business:
- Looks like no win-win: If a prospect is looking for free ideas and doesn’t offer anything in return, perhaps it’s time to take a pass. In the traditional client-agency relationship everyone benefits. There are too many prospects that are simply looking for free advice they can take in-house, pass off as their own, or just hand to a freelancer. If you get a feeling that this prospect is one of those, do a double check. Request more information, ask more questions. Take a good long look at their history, and even call a few of their old agencies or staff and get a read on the situation.
- Focus is only price: It’s tough to get excited about any work when the only driving factor for the client is price. And it’s a crushing experience to be driven into a pricing war with other agencies – only to lose. Make sure you’re not getting the nickel-and-dime treatment, and the prospect is also interested marketing that moves the needle. If their only focus is price, make sure it’s worth your time and effort. If a client doesn’t value the benefits of marketing, educate them. If your agency really needs the work to cover overhead, perhaps take on a project. But make sure you ramp up new business to replace that client as soon as possible.
- Not in your wheelhouse: If you walk out of the first meeting wondering what the prospect was talking about, perhaps it’s time to keep walking. It damages the entire industry when an ad agency is exposed as being clueless about the nuances about a client business. Please understand, there is nothing wrong with a little on-the-job training. There are many industries where an agency can quickly get up to speed on a client’s business. Just make sure that both the client and the agency understand all the challenges with this approach. If the prospect is comfortable with your limited industry expertise and recognizes your expertise in marketing, go for it.
- Expect the moon and stars: We all love those clients who are looking to blow away the competition, set new standards in marketing, or who is willing to take risks. But if a prospect is asking for something that’s impossible, handle with care. And if you can’t manage their expectations, perhaps it’s time to walk away. If your agency can’t hit their expectations there is the very real possibility it will come back to haunt you – word on the street that you failed becomes your brand. And watch out for those clients that talk a good game (but really are just looking for a minor marketing tweak) or who can’t bring leadership on board to approve any new big idea. This will end up costing you thousands in lost time as you produce something great, award winning work, a really big idea, only to see it get canceled at the last minute. And the so called “big idea” that gets approved is to make the logo a bit bigger.
- Crossing a line: If your agency has a strong point of view and cultural values, there is nothing more damaging than accepting a project that’s in conflict with them. It sends the wrong message to your staff and to other prospects that your values aren’t that important after all. Your team will feel the conflict and the work will suffer. A ripple effect may end up slowly crushing the spirit of the staff, your culture will be harmed and all work will suffer. No matter how you try to rationalize it, you’ve broken a promise. It’s a small industry, and word will get out. That’s bad for the long-term prospects of the agency. Better to just walk away.
- Blocking client: Something funny often happens with agencies that are really looking for new prospects – they get tunnel vision. They get so focused on chasing a prospect they forget the greater opportunity down the road. If a prospect is offering you a small project that will give you footsteps into a new category, outstanding! Take it. But if it’s a small prospect, and by accepting this project it blocks you from other more viable accounts, it’s time to walk. There is nothing worse than doing a little one-time project that freezes you out of the big account down the road. There is a hidden-cost to every client, and if it ends up costing more to take this job, walk away.
One of the toughest challenges for a leader is figuring out when it’s time to cut their losses – to just walk away.
After all the work to find and set up a meeting with a good prospect, it takes guts to walk. But there are times when you just know, deep down, this is not the right prospect for you. The income may be nice, just make sure you fully understand the hidden costs.
The most effective way we know to avoid having to take a client that ends up hurting more than they help is to make sure you have a steady stream of leads flowing into your agency. Having more leads makes it easy to go into a prospect meeting with the knowledge that you have more new business meetings down the road. This gives you the freedom to treat each new business meeting as you would treat a new hire; you “interview” them to see if you care to pick them up as a client. This changes the entire balance of power, and ends up being attractive to many prospects. People desire what they can’t have – it’s human nature. It’s about perception, confidence, and understanding new business. Prospects end up wanting something that is eluding them, something they have to chase. And this gives you an advantage.
More nightmare prospects here!