Marketing agencies face pressure on multiple fronts, but one of the biggest sources of stress—and one of the most crucial factors for success—is the problem of client retention. Your revenue depends on your ability not just to attract new clients (which you can do—you are a marketing specialist, after all), but also your ability to retain them. The costs of client retention are lower than the costs of acquisition, and as you get to know your clients better, you’ll be able to serve them better. Plus, long-standing clients are beneficial to your reputation, as well as your portfolio.
Unfortunately, the average client relationship with a marketing agency only lasts two to three years. So why do clients leave in the first place? Better understanding the root causes for client dissatisfaction can help you proactively counteract those threats, and ensure your clients stick around for as long as possible.
The Biggest Reasons Clients Leave
These are some of the most common reasons why clients leave their existing marketing agencies:
1. Poor results. The most important things clients want from their marketing agencies is value. They’re probably spending thousands of dollars a month with your agency, so if they feel they’re not getting thousands of dollars of value from your services, they’re going to leave. Poor results can manifest in a number of different ways; for example, if you’re optimizing your client’s website for SEO, but their organic traffic hasn’t increased in months, they may blame you for not providing better outcomes. They may also perceive a mismatch between what they’re paying and the services they’re getting. The straightforward solution here is to invest more in your clients, and be proactive if you ever have a period of poor results; throwing in free extra services to compensate for a poor performance period could be all it takes to resolve a bad situation.
2. Poor communication. Clients also frequently leave due to poor communication. Most clients want to communicate regularly, getting status reports and weekly updates at a minimum. They want to know that their concerns are being heard, and they want to feel like they matter to your client service representatives. If you drop the ball on communication, whether it’s by failing to send weekly reports significantly or by frequently miscommunicating, your clients will eventually leave. Make sure your account reps are communicating as clearly and concisely as possible, and schedule regular (ideally weekly) check-ins to make sure things are going as well as you’ve expected.
3. Unmet expectations. There’s a reason why “under promise and over deliver” is such common (and good) advice. Your clients will judge your performance based on their expectations of your performance, and little else. If, during client onboarding, you promise your client they’ll see ten thousand monthly web visitors after just a few months of work, but they only see a thousand, they’ll be ridiculously disappointed. If you only promise hundreds of visitors and they get a thousand, they’ll be ecstatic. If you consistently fail to meet the expectations you set, it’s a sign of both inexperience and unreliability. Rein your expectations in, and only promise what you can reliably deliver.
4. Budget issues. Sometimes, clients will leave due to budget issues, which rarely have anything to do with the services you’re providing. If they have a bad year or signed up for a package of services they can’t afford, they may be forced to cut your services prematurely. It’s unfortunate that marketing and advertising services are frequently the first ones to go when money gets tight, but it’s a reality you’ll have to deal with. Talk to your client openly about these issues, and if you can, consider offering them a temporary discount to keep their business.
5. A change in needs. Similarly, you can’t do much to prevent a client leaving due to a change in internal needs. If your marketing agency specializes in providing local marketing services for small businesses, but your client has grown to become bigger and more nationally prominent, you can’t blame them for switching to an agency with more expertise in that area, or a wider range of available services. Clients may also leave if they need a suite of marketing services, but you can only offer one or two specialized services. Working with another agency can improve your offerings, and potentially allow you to continue serving your client’s needs.
6. A strong competitor. If one of your competitors is especially skilled at winning new business, they may be able to take a client from you. While some clients will stay loyal to a brand they’ve worked with for a long time, almost everyone has a breaking point. If a competitor can offer better services, better communication, or a much better price (which is usually the targeted angle), your client will inevitably leave. Get the details on the new deal if you can, and try to one-up them with your own special offer.
7. Internal politics. Sometimes, a client will leave due to internal politics, which are hard to prevent as an outside vendor. For example, if your client’s boss has a preference for a different marketing agency, they may force a change—even if there’s been nothing wrong with your services in the past. If your client undergoes massive internal changes, like a merger or an acquisition, the new leadership and new personnel may view your professional arrangement differently than their predecessors. If this is the case, you may need to treat them like a brand-new client temporarily.
Optimizing Your Approach
Knowing these critical motivations for client departures, you can fine-tune your organization to maximize client retention. One of the best ways to do this, overall, is to partner with another agency (or multiple agencies) that specializes in a particular area. Working with specialists gives you more expertise by proxy, and allows you to hold someone else accountable for the quality of the produced work. It’s also ideal for cost management, since you’ll likely pay less for outsourcing the work with another agency than you would making a full-time hire.