For the most part, when you mention “firing” someone, it’s in reference to an employee termination. Or perhaps it’s a situation of a client “firing” their agency. There’s also the “firing” of clients that happens for a variety of reasons. Hopefully it’s a good reason for both the agency and the client. It’s an inevitable part of doing business, especially with consulting, marketing and advertising industries where agencies are in high demand.
No one likes to do it, but it happens.
For example, the client needs might change beyond what the agency can deliver or the business model of the agency might change, requiring the “cleansing” of client engagements that are not consistent with the business. I am curious about the reasons that client engagements are terminated by agencies, so if you’ve been in that situation, please take the poll below:
What are your most common reasons for discontinuing a client relationship?
- Client is too difficult to work with (49%, 37 Votes)
- The engagement is not profitable for your agency (24%, 18 Votes)
- The client declined to pay invoices on time or at all (21%, 16 Votes)
- The client's needs have changed outside the scope of your agency's capabilities (4%, 3 Votes)
- Your agency oversold and cannot deliver (1%, 1 Votes)
- What happened in Vegas didn't stay in Vegas (1%, 1 Votes)
Total Voters: 76
Loading ...Has your company been “fired” by an agency? If so, what was the reason? If any consultants or agencies have other reasons not listed in the poll or if you have a strong opinion about this topic, please leave them in the comments.
All of the reasons above are valid reasons for letting a client go. I have let a client go (gradually over time) for a combination of slow, then no-pay; ridiculous turn around time expectations and poor client effort.
Actually, poor client involvement is another reason to release a client. I can’t help a client if they are unresponsive, don’t know what they want or need, and expect me to pull things out of thin air. If I ask them for a vital piece of their web site copy, input or other information and they can’t meet their own self-imposed deadlines, it does not bode well for the project.
I had to fire a client once because we couldn’t communicate. Well, she couldn’t communicate, and I wasn’t Kreskin. Too bad also, because she could have been worth lots of cash down the line.
Lee, my take on the reasons you outlined above is basically “An ounce of prevention…”:
# Client is too difficult to work with – avoidable unless SEM is dealing with a change in management & contacts.
# Your agency oversold and cannot deliver – avoidable if expectations are set realistically.
# The engagement is not profitable for your agency – avoidable if a 6 mo. to 1 yr. contract is signed with fair pricing to both buyer and seller.
# The client
I think up front due diligence, setting proper expectations, communication and account management are the most precursors to whether an agency/client relationship works out or not.
Char, you make a good point about responsiveness. In the search marketing industry, I’ve seen stats that say all SEO recommendations are NOT implemented by clients about 60% of the time. That’s a huge number, but it doesn’t dig into the details, like whether SEO recommendations are even possible or whether the cost of implementation outweighs the potential benefit.
I think the poll implicitly suggest to think that client reliationships are qiute similar to each other. Of course, everybody knows that they are not. If you think as a manager, every business activity including client relationships has to be evaluated by risk and profitability, acknowledging that the other party evaluates the same things. Let’s suppose that there is no difficulties with the payments (otherwise the risk factor of the evaluation becomes too high, so most companies cant’t afford to continue such a relationship. Late payments just cause less profitability).
If you think about the client relationship just as an order the only important thing is that your work have to be payed.
If you think about the client relationship as an investment (reference, long term relationship, widening range of services you will deliver later) than your portfolio (remember- every business activity is an investment, just like T-Bonds) consist of two parts: The first part is payed immedietly, and without risk (ideally). The other part of the portfolio consist of references, good-will growth, more orders (approving that the client’s business also grows) (probably with greater profit-ratio), etc.
Oh, sorry. The end of my comment is missing. Here you are!
…Than you have to multiply the probability of the scenarios with the present value of the expected profit (of course you have to take into consideration of the risk sensitivity of your company). Than add the profits of the two parts of your portfolio, and you will get the present value of your profit. If it is below your minimal profit expectations, you have to reject the client relationship, otherwise you have to start (or continue) it. Isn’t it simple?
Of course the modell is simple. But it is very hard to evalute future scenarios. The only thing I tried to explain, that it is a mistake to decide about a client considering one special factor of the relationship. For instance I do not send a client becouse it is hard to work with him. If he pays my ‘difficulties’ I continue the hard work with him. On the aother hand I tend to work for share- if the profit is high enough, and the risk is low enough for me, why not?
We don’t lose many clients but when we do it’s because of items 1 (Client is too difficult to work with) and 2 (The engagement is not profitable for your agency).
I have found the most important aspect of a quality relationship is keeping value and goals in the forefront. We won’t start a project anymore without actual conversion goals being spelled out. We have found it is far too difficult to measure success or failure later on without clearly defined goals. We also keep value in clear view. What is the value of X daily visitors to your site and Y conversions? Focusing on value generally squelches any expense complaints from purchasing.
We have also moved towards being very clear with customers who are overly price conscious that there probably isn’t a good fit between our companies. And try an go our separate ways before the relationship spirals into an actual firing.