Mistake 2: Lack of preparation
It is common to skip preparation before negotiation meetings and phone calls believing you can ‘wing it’ in the meeting – or worse still, on the phone.
Often it seems the more senior the person in the agency, or sales person, the more they think they can ‘wing it.’
This can be exacerbated when two or more of you go to a negotiation meeting with clients and haven’t prepared. You are likely to contradict each other.
There are few areas in life where preparation pays off more than in negotiations.
It will increase your confidence to negotiate, provide goals to aim for and help you anticipate possible actions, questions and challenges by the other party.
Mistake 3: Thinking great ‘client service’ is always saying ‘yes’
What is the impact on your business of always doing your client’s bidding and always giving them what they want?
When we join an agency in a junior role, typically we are told how important the big clients are and that ‘whatever it takes’ is the mantra.
Giving in ‘for an easy life’ is so common; however…
You get the behaviour you tolerate.
It is easy to make the mistake of doing what you think is right in the short term. However, you end up making life harder for yourself in the medium and long term.
Clients encourage this mistake. They want more for less. They seize every opportunity to squeeze more from each budget.
Sometimes, weak agency account management believes, incorrectly, that the way to retain clients is to do everything and anything clients want, even for an unprofitable fee. Great client management should really be about delivering value by the bucket-load at a fair price and a fair return for the agency.
Charge what you are worth not what you think they will pay.
Managing the expectations of your client is an important skill. Sometimes we over-promise through excitement, enthusiasm or naivety, or all three, and then either under-deliver – or worse, fail to deliver.
Giving in for an easy life has become a huge problem for agencies. Agencies are haemorrhaging profits by being too quick to say ‘yes’.
Many account handlers are too passive and too reactive towards their clients. If you lack assertiveness in your negotiations, there is a high risk the other party will take advantage of your behaviour or, if nothing else, that you don’t achieve the full potential of the deal for yourself.
Often this lack of assertiveness is combined with weak agency account management. We agree too readily to a client’s demands from the fear of ‘rocking the boat.’ We don’t charge for those ‘minor changes’ or the fourth set of amends. We don’t question that unreasonable deadline or inadequate budget versus the client’s requirements.
What happens when you give a child everything it wants, such as a new computer game, a new mobile phone, sweets, DVDs, fast food and always say ‘yes’ to their demands? In workshops when I ask this question I get the answer ‘a monster’ or ‘a brat.’
Are there parallels with agency clients? By caving in and giving your client everything they demand, what might you turn your client into?
Excitedly, we win that new client after a grueling pitch against tough opposition. We win that new client having impressed them with our strategic thinking, our insights into their business, our reputation, our creative ideas, our challenging perspective and our new-found business relationship.
We’ve developed and presented some of our best thinking and ideas. Our great fresh thinking impresses the client and they are convinced they are about to employ experts who really understand the client’s business.
Then, perhaps two years later, there is a danger we become like a sausage machine. We simply implement and deliver ‘sausages’ – not the original reason we won the business in the first place.
We fall into the implementation trap.
We start to believe that our prime purpose is simply to implement. The sausage machine becomes increasingly efficient at producing sausages, which is fine while the client thinks they only want sausages. We continue to deliver what they want, not necessarily what they need.
When the client becomes bored of sausages or sausages are no longer required, they feel like they need a more varied diet and there is a risk they look elsewhere at other agencies.
Or it all seems fine until a new senior client decision-maker replaces our previous main contact and questions why they are employing expensive advisers to simply implement.
The acid test for an agency is when the senior client who appointed the agency leaves. How enthusiastically do the remaining members of the client team recommend your services to the new incoming senior client?
It is easy to be so busy delivering and implementing that we forget what it is that the client truly values. When your focus is simply to deliver and implement, this can impact your self-belief and confidence. Instead of knowing what your client needs, we make assumptions about those needs. This back-foot mindset weakens your ability and power to negotiate.
Do you know what your clients really value?
When did you last ask them?
What might happen if you said ‘no’ to your clients?
Next time: Chris discusses why pressure can lead to wrong decisions and why Not increasing fees and rates is a mistake
Chris has published his latest book, ‘Why Do Smart People Make Such Stupid Mistakes?’ using his years of experience as a guide to those who are looking for new ways to increase revenue and profits through our tough economic times.
‘Why do smart people make such stupid mistakes? ‘ is designed to help agencies and sales people make more informed choices, by choosing more appropriate responses and then working more efficiently. He shares his strategies, techniques and tips on how you can be more profitable, whilst delivering huge quantities of value to your client and building stronger client-agency relationships. Value which takes your clients’ businesses closer to achieving their critical business goals and, in so doing, will take you closer to achieving your business goals.
