If you’ve read any of my other material, you know that I believe that learning to manage your clients effectively is the key to building a successful agency. and avoid an over-servicing epidemic. Client management is a complex, multifaceted process: it can’t be explained in one blog post. If you’re interested in taking a more in-depth look at the topic, you can download a free copy of my Client Management Guide here.
In this two-part blog series, I’m going to focus on one particular aspect of client management that I’ve frequently encountered in my agency coaching practice – how should you handle clients who keep asking for more?
Surprisingly, it’s often our good intentions that cause the most problems for the agency.
When Good Intentions Come Back to Haunt You
Let me know if this sounds familiar to you……..
At the start of any new client relationship, we want to impress them. We’re eager to do everything we can to satisfy these clients because we know that the real money is made in repeat business, not short-term contracts.
We sit down with them, figure out what exactly they’re looking for (based on their brief, or by following our own processes), and give them a deadline for the work. Depending on how important this new client is to us, we might place ourselves under some pressure with a deadline that’s a little too close for comfort – but we’re confident we can pull it off.
That is… we’re confident until that client comes back with additional requests (how often do you hear from a client “oh by the way, can you just add this in, it won’t take you long” Famous last words! Maybe they want to amend the original project or have some separate work completed. Whatever it is, we’re setting out to satisfy this client, we agree to their request and complete the extra task.
Suddenly, you’re in a position where the client has now got something for free. This starts to create an expectation on their part that they can call you up or fire off a quick email and have their problems taken care of at no extra cost.
And when you deliver on the main project, they’ll probably be thrilled with the quality of work – and at all the extras they got along the way. But when they return with more requests for the following month, they expect that you’ll continue to handle all these “little extras” for them… even when they add up to a significant time commitment.
If you try to pull back and stop delivering all these extras or try and charge them for them this time, the client can become dissatisfied. They’ve been conditioned to expect one thing, and are receiving another. Because it’s less than what they wanted, they’re unhappy. And unhappy clients are rarely long-term ones.
The Problem With Over-Servicing
Over-servicing is a common way agencies try to achieve customer satisfaction. That’s because it works for the client – by constantly over-delivering on client projects, you can pretty much ensure that they’ll be “wowed” with the service they’re getting – but not for your bottom line.
A tough situation, to be sure – and one I’ve encountered all too often in my coaching practice.
“Going the extra mile” (which by the way, I was telling a client yesterday is NOT a good value for their agency) can be a useful tool for your business, but only when it’s strategically deployed. I always tell my coaching clients that over-delivering by 10-15% occasionally is fine, as they’ll probably be able to make up that difference another month when there’s less to be done. But constant over-servicing in the name of greater client satisfaction is a losing game, not one you should play if you’re trying to build an agency that wins in the long-term (not just today) and remains profitable.
Handling clients that are always asking for more is difficult, but there are certain best practices you can follow to make it easier. Let’s look at the first of these now in more detail.
Create a Rock-Solid Service Level Agreement
First impressions count. If a client’s first impression of your agency is that you’re simply there as a tactical supplier, it’s unlikely you’ll have a frustrating short-term relationship with them. However, presenting yourself as a competent and consultative partner from the outset (not just a supplier), results in a stronger long-term relationship based on respect from both sides.
One of the most important things you need to get right is your ‘service level agreement’. You likely already have standard terms of engagement/standard scope of work documents in place – if you don’t, make this a priority!
A really solid service level agreement will outline the scope of work to be completed for a particular project, relevant deadlines, outputs, outcomes, response times etc. But it’s not just a case of including everything that the project entails… it’s also about figuring out what’s not included.
If you recall the example we discussed earlier on in this piece, you’ll remember that many little client requests add up over time, to the point where you’re losing out on significant amounts of billable hours. This undercuts your agency’s profitability, leaving you with a difficult decision to make – should you keep over-servicing that client to keep them happy, or renegotiate the terms of your arrangement (and risk losing them), or just walk away?
This dilemma can be avoided by setting out:
- A clear scope of work for what’s included in the monthly retainer
- The rate you charge for extras (you know I am not a fan of selling hours so try and keep to project fees when pricing additional work)
With this in place, you’ll have an easy out when clients come along with additional requests outside the scope you originally agreed upon. Ensuring they understand that ‘extras’ cost extra from the outset will only be of benefit to your business in the long run… but if you fail to put this in place upfront, you’ll suffer. Part of this is getting your MINDSET right from the start and ensuring you constantly communicate the VALUE of what you do rather than just the OUTPUTS (more on mindset in a future blog).
In this week’s article, we talked about one of the most common problems I’ve seen in my work with agencies of all shapes and sizes… not being able to say NO to clients who keep asking for more.
This is a problem for your agency because it puts you in a position where you’re running just to stay in place. When you eventually want to slow down and return to the original terms of your agreement with a client, they’re dissatisfied with a feeling of getting less value for their money.
Starting off on the right foot is very important. With a well-drafted scope of work and agreed service levels, you’ll be able to avoid delivering increasingly unprofitable work and getting backed into a corner by client expectations.
In the next article (which you can read here) we’ll talk about the crucial difference between outputs and outcomes, how you can avoid your work being seen as a commodity, and some quick solutions you can put to work in your business right away to solve this problem.