Saturday, May 21, 2011

Client Retention Obstacle 3: Failing to Listen

It’s hard to ask for feedback from a client. And it’s even harder to listen to it. Really listen, absorb and act. Why?

Client retention at risk.  Failing to listen to clear and unambiguous feedback, or not knowing about a bad situation in plain sight seems incredible. Yet too many account and project managers fail to heed the obvious warning signs that a client relationship is sinking and that client retention is at risk.

Clear message but no action. Here’s a good example of this dilemma. A former investment banking friend of mine was hired by a private equity firm to assess the problems at a software firm they purchased several years ago. It took him just several days to figure it out. The leadership installed by the private equity firm did not match with company culture and the troops were in a passive mutiny. Sales were plummeting and staff leaving.

His message to the owners was clear: management at the software firm was failing and they better do something about it, and do it fast.  Yet, he couldn’t get the PE firm’s attention and no action was taken. There was a crisis plain and simple but no one would listen and act. Why?

It’s hard to hear bad news.  Why is it hard for us to pay attention to bad news? Well, as humans we might be hard wired to not to listen. In a book entitled, Willful Blindness (http://www.mheffernan.com/book-wb-summary.shtml), author Margaret Heffernan argues that our brains have evolved in a way that rejects conflicting, anxious and complicated situations. We just don’t process that kind of information well.  So seemingly critical and obvious problems go unnoticed and unaddressed.

This happens all the time in the client relationship world. The client stops returning calls. The VP is suddenly not available and now you have to talk to a manager. You find out you haven’t been invited to a new office opening. Budgets are in tatters. A new project was given to a competitor. Even with all that facing you,  you ignore the situation or don’t take action because you tell yourself it's not that serious. Maybe you’re just too busy to follow up. Or you don’t see the problem at all.

Bring in the outsider. One tactic Heffernan suggests is to engage someone outside the organization who can see situations in a new ways and counteract complacency and group think. This helps bring new understandings to life. Our brains may like routine but they are also open to change. And, if clarity improves and actions occur as a result of that outsider input,  your client may stay around a little longer.

Monday, May 9, 2011

Client Retention Strategy: Care for the Client (Talk Money)

Caring? OK, I can hear it already. This guy has been sucked in by the the dark side.

You ask, how much more can I do for the client? I do care. I give them my all my energy and creativity all day. I care enough already about this client relationship.

Sure, client facing staff do give it all to their clients. Account and project managers are no doubt some of  the toughest, emotional jobs that exist. The question I pose is, are you giving the right stuff, caring the right way?

Talkin' Money. Money is one area that you probably don't give enough. Not the amount of money. I'm sure you've shaved budgets to the bone to get the work.

But have you talked about money with the client in the right way? Have you shared what your firm needs to make on a project and why? Have you laid on the table the profit  needed  to survive, to keep the doors open to serve them?

At a recent client interview a CMO told me plain and simple that if the agency has shared WHY they needed a higher budget, she probably would have agreed. But there wasn't the frank, open discussion about money she wanted.

Courage and Openness. Now, every client doesn't want to talk openly about money or anything else. I get that. But for ones that do, and there are plenty out there, have the courage to be open and talk about mark-ups, multipliers, gross margins, etc. Assess whether they are ones that want a great client relationship. Because if they want a partner for the long-term, they will be OK paying what you need. Otherwise, you probably don't need them.

Sunday, May 1, 2011

Client Retention Strategy: Be The Leader



As I was interviewing some marketing folks at the headquarters of a national retail chain, it became clear what they really wanted from their agency. Not just super creative, insightful analysis or smart strategies. They wanted to be led through the uncertainties of a new business and marketing landscape.


Client retention at risk. As marketers and their agencies dive into digital and social media there is both excitement and fear about new ways to connect and influence customers. Many possibilities and unknowns yet no stomach for uncertainty. The social and digital worlds are shaking client relationships. 

Leaders needed. Clients want certainty but there is no clear roadmap. No proof. No worn Harvard Business Review case studies.  Competitors are doing it and executives don't know what it is. This is an emotional condition and clients need guidance on many fronts. 

To be effective, account and project managers not only need the practical knowledge about the new social strategies and technology. They need a more comprehensive leadership approach to strengthen strained client relationships, an approach focused on credibility.

The Five C’s of Credibility.  This is a leadership philosophy that simply defines leaders as those with followers who find them credible. Followers who will be influenced to take action the leaders think best. Clients today need to be (and want to be - even if they won't admit it) followers. Not in a subservient way, but as one follows their partner in a mature relationship. 

What does it take to have clients follow account and project managers? They need evidence of credibility.  Credibility that can be earned through demonstrating the following:

1.     Competence: the leader knows the strategy, tactics, methods and technology, as well as the softer skills  - teaching, facilitation and communication
2.     Conviction: the leader possesses and communicates a compelling vision for the project and the relationship
3.     Courage: the leader will make the tough calls, confront conflict, voice an unpopular but correct position
4.     Care: the leader demonstrates genuine concern for the client’s personal and professional life
5.     Composure: the leader keeps cool and collected in difficult client situations and is not afraid to demonstrate emotions appropriately

Whether it’s delivering social marketing strategy, presenting innovative designs or explaining budgets, when account and project managers demonstrate the 5C’s of Credibility, clients will follow their direction. And in doing so will help relieve uncertainty, produce needed results and build strong client relationships. 

Note: Thanks to Tony Smith and Steve Williams of the Leadership Research Institute (www.lri.com) for teaching the 5C’s of Credibility and sharing a wealth of experience.