Marketing agencies lose clients all the time — it’s a fact of life. An important benefit of losing clients is being able to learn from the experience, to prevent mistakes that cause clients to leave — or mistakes that cause you to take on the wrong clients to begin with.
Here are a few reflections on losing clients at Straight North that we hope will help you manage your client relationships more successfully. (Many thanks to Scott Hepburn, General Manager in Charlotte, North Carolina, for his input on this article.)
Problems With Alignment
Most client churn occurs when the client experience no longer aligns with expectations. No matter what the client values most — results, attention, commodity value, etc. — when those expectations are no longer being met, clients leave.
In some cases, closer communication with the client can prevent this from happening. In other cases, circumstances beyond anyone’s control play a part. It’s certainly helpful not to set expectations too high at the beginning, which is why it’s so important to be as realistic as possible in projecting outcomes.
Problems Within Our Control
Are we delivering an exceptional service and results? Is our performance superior to that of competitors? Are we responding to client needs as quickly and effectively as we can? It’s important to assess agency performance after a client leaves.
Having a frank discussion about performance requires an agency to create an environment where expectations are high, but criticism is welcomed and taken constructively in all quarters. If the team is unwilling to recognize problems and fix them, the same problems will occur over and over, causing even greater levels of client churn.
Problems Outside Our Control
Sometimes we do everything right and still end up losing the client. Companies go out of business, change personnel, lose funding, get acquired, radically change their marketing strategy — you name it.
The best-case scenario when this happens is to see it coming. If you know or sense the client relationship may be ending, you can prepare for it in terms of your budgeting and capacity to handle new projects. Surprise losses, especially if they are significant, can be very disruptive to workflow and to morale.
Problems With Clients
Retaining clients is the most efficient way to build a business, but there are some clients that should not be retained. Some campaigns are simply unprofitable. Sometimes, doubling down in an effort to make them profitable succeeds only in taking more attention away from other clients that show more promise.
Knowing when to fight to retain clients, how hard to fight, and when to throw in the towel are tough decisions, but they need to be made and not put off indefinitely. This is where having experienced client-facing team members is invaluable. You can seldom know for sure if firing a client was the right decision, but successful agencies have a high batting average for making good calls.
Problems With Knowing
Clients will give you all sorts of reasons why they are leaving you, but let’s face it: Those reasons aren’t always the truth. It’s more comfortable for a client to say, “It’s not you, it’s me,” than to say, “No, it really is you.” Clients will obscure the truth about why they leave out of discomfort, shame, frustration, convenience or to prevent burning a bridge.
Even if you know or strongly sense the client is lying or not telling the whole story, it’s seldom wise to press the issue. If you challenge the client on the facts and get into an argument, it will be you who burns the bridge. When clients have made up their mind to leave, you’re unlikely to change their mind.
Over to You
What have you learned from losing clients that’s made your business stronger?