Why agencies fire clients

Todd Defren is letting the cat out of the bag about why agencies fire unprofitable or unpopular clients.

Some campaigns are just not profitable since expectations and demands exceed the time and budget available to deliver. Sure there are peaks and troughs of activity, but there’s little point in a relationship which is one-sided and unprofitable. There’s an opportunity cost to continuing these campaigns, so it’s a fairly easy one to spot and to take action on.

The trickier one, which Todd refers to, is the unpopular account. Demands are fine, budget is adequate, technology is good but it’s just not fun to work on. We’ve all been there. You pitched the account, the campaign was great, but now new contacts have been brought in, and the chemistry is gone. This can be addressed with some frank chats and perhaps switching around the account team – we all have our styles and approaches, so a swap out can often fix the problem.

But fix the problem you must. And Todd hits the nail right on the head, since in the current market you need to safeguard your staff as much as your revenue, if not more. The last thing you want is for your team to leave since they are forced to work on a beastly account. Better to resign the client, find a new campaign and keep your strong team. Good staff won’t stick around working with bad clients. And more good clients will only be attracted by a great team. So, the long term view is to take the hit to revenues, disengage with an unpopular client, and find some new biz to work on. Thankfully in the current climate agencies can feel confident in finding new clients in short order.

In fact, it’s a useful exercise to sit down periodically and look at the bottom 10% of your client roster – not by budget but by popularity. Keeping a strong client roster is an intrinsic part of keeping and attracting great staff. And that benefits all of your clients, so best to manage the roster proactively.

  • Save a flack. Fire a client!

    Firing your clients is definitely counter-intuitive to many agency owners out there. But if you really value your people like you say you do, youd be doing it a whole lot more often.
    Todd Defren of SHIFT Communications in San Fran fired sever…

  • Hi Morgan –
    Thx for the linklove. A lot of emails came my way on this “firing a client” post. We’ve got to find a balance between “preserving revenue” and “preserving agency culture,” eh?
    Best,
    Todd

  • Yes – the balance is hard. Obviously most agencies wish to increase revenues – for profit, to recruit new staff allowing progression for the current team, for investment and salary increases.
    It doesn’t happen often but if you have an unpopular campaign and your account manager were to leave, you’d jeopardize the other clients that person works with. So in some ways, if you act to disengage from a dysfunctional relationship, you are safeguarding the other clients and revenue which you want to keep.
    Of course the hard thing is, that if a member of staff choses to leave, it’s unlikely you’ll hear directly that it’s due to that campaign. It’s just a contributing factor which makes competitive solicitations sound more favorable. The grass looks greener, even if the reality is different.
    Thinking about this more, perhaps ‘fire’ is a little harsh. It sounds a bit arrogant. What I mean is just to opt not to continue. Client-agency relationships have to be good for both parties. If it’s not working out, and neither party can find a way to improve it, it’s best for both to recognize that a no-deal is the best outcome.
    Worth noting that I don’t think that having a more attractive client come along is a good reason to disengage from a current competitive client. Loyalty is important and you soon get a reputation for being fickle. And who wants to work with a firm which might turn around and jump to a competitor?

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