Increasing Your Marketing Agency’s Revenues by Saying "No" to Clients

[The following is part of the continuing series of advice for marketing agencies. Andy Beal offers various business coaching services]

I know what you’re thinking. You’ve read the title of this article and you think Andy Beal must have lost his mind. How in the world can you increase the size of your marketing firm by actually saying “no” to a client? Isn’t that counter-productive, you’re asking? Surely you need to find ways to say “yes” to your clients, so you can get their business and grow your agency. Well, spare me ten minutes of your time, and I’ll show you why saying “no” to a client is often good for business.

Not All “Yeses” are Created Equal

In the past seven years of growing search marketing firms, I’ve said “yes” to clients more often than I can remember. When you’re growing a business — especially if cash-flow is tight — agreeing to the requests, or demands, of a client appears to be the only way you’ll ever get to the “big bucks”. While early in my career, I made the mistake of saying yes too many times, over the past couple of years, I’ve learned that saying “no” is more lucrative.

Saying “No” to Prospective Clients

How excited do you get when you’re negotiating that final contract with a prospective client and you’re accountant is willing you on to get the business in the door and on the books? Just like animals can smell fear, prospective clients can smell your desperation to get their business.

Unless you’ve done a phenomenal job of building the value of your agency’s services, its expertise, and benefits to the prospective client, the chances are high that you’ll be asked for a discount or some additional services for free before the client signs. Argh! You’re so close, you’ve made the investment in trying to win this account — your time on the phone, the pretty proposal, the face-to-face meetings — and if you’ll just reduce the price of the campaign from $5,000 a month to $3,500 a month, the client will sign today. What to do?

Well, here’s what most agencies do. They cave in. They say “yes” to the discount, or say “yes” to the extra workload, at the same fee. What they didn’t do, and what will surely come back to haunt them, is they didn’t say “no”.

Now, I’m not advocating being rude or arrogant at this stage. There’s the right way and the wrong way to say no, but you shouldn’t necessarily say yes either. You see, by simply agreeing to the clients demands, you’ve handicapped your business in two ways:

  • You’ve reduced the perceived value of your service. By dropping your fee from $5,000 to $3,500 a month, you’ve planted the seed in the client’s mind that your original price was inflated — perhaps they’ll think you were trying to gouge them.
  • You’ve established to the client that everything else is negotiable. I’ve lost track of the number of times I’ve reduced the price of a campaign and then found that client to be the most demanding and the most difficult to work with. Everything becomes negotiable from that point on — deliverable schedules, reports, results — the client now knows you’re likely inflating everything from pricing to timelines and will be on the lookout for opportunities to get more from you.

Hopefully, the above is resonating with you thus far. But, you’re probably asking, “How do I say no without losing the deal?” Let’s take a look.

SponsoredReviews Launching Paid Blogger Review Service

360 Enterprises, Inc. – the parent of our sponsor Text Link Brokers – is getting ready to launch SponsoredReviews, a marketplace where bloggers can charge a fee for a review and advertisers can search a database of publishers.

It appears they’ve sat back and watched the reaction to both PayPerPost.com and ReviewMe.com and taken the best parts of each service. I’m particularly glad to see they’ll be selective in which bloggers can join the service and will require full disclosure.

What might help set them apart is a lower transaction fee than others and allowing bloggers to negotiate pricing with advertisers.

I’m still on the fence on whether I approve of directly buying reviews from bloggers. I’ll probably stay there for a while – after all, some could suggest that I’m covering this story because TLB is a sponsor, even though they didn’t actually pay me for this post.

Channel Sponsors

Using Social Media to Build an Email List

Sally Falkow suggests that social media marketing can be utilized to build a more “traditional” email marketing list.

She outlines some case studies that support the notion and offers the following key tips:

  • You have to identify an audience interested in your content on a relevant social media site
  • You  have to offer them interesting and relevant content

  • Once you become a trusted source of information you’re home free – they convert very well. 

The concept certainly has the potential to do wonders for a marketing campaign. Email marketing works well, when the content is from a trusted source – something the recipient expects and looks forward to receiving. Social networks are built on friendship, sharing passions and trust, so are the perfect place to fish for email subscribers. (noticed I said “fish”, and not “phish”) ;-)

Whizbang Technology Not Enough to Help Microsoft Compete with Google

The Mercury News takes an in-depth look at the lack of ROI Microsoft is getting from its investment into web technologies, especially search.

Despite introducing a bunch of new products, including a new search experience, online video and Virtual Earth, Microsoft just can’t seem to keep up with Google’s explosive growth.

The result: The number of visitors to Microsoft’s sites has not budged, while the amount of time they have spent there has dropped. Advertising sales have fallen. Meanwhile Google’s traffic and advertising have continued to surge.

I’ve long said that the race is no longer about technology, but brand perception and user experience. Google has done such a great job of capturing mind share that it will be hard for a company such as Microsoft – with their perception of being a controlling company – to ever topple them in the minds of the consumer.

This Blog Made Possible by…

Marketing Pilgrim wouldn’t be half the blog it is today, without the support of our sponsors and advertisers. Do us a favor, and check out these fine services…

Text Link Brokers – if you looking to buy links – for traffic or SEO – Text Link Brokers has a vast network of link partners and great pricing. They even offer a beginners guide to buying links.

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SoloSEO – whether you’re a professional search marketer or new to search engine optimization, you’ll appreciate SoloSEO’s comprehensive set of tools. 2-week free trial!

Mozy – offers 2GB of free online back-ups – enough for storing vital files – and it’s less than $5 a month for 30GB, if you need it.

More Spam Control Needed With Akismet

Marshall Kirkpatrick’s post about the amount of spam getting thru his Gmail filter – 19 of 26 emails were spam – has a comment from blogging buddy, Jeremiah, that reminded me of an issue I’ve noticed with Akismet.

While Jeremiah’s finding Akismet to be reliable, I’m finding it to be less so. With the number of comments increasing on Marketing Pilgrim, I’m thankful for the spam filtered out by Akismet, but I’m having to spend too much time “de-spamming” false positives.

This was magnified with the Digging of a recent article, resulting in many comments. I found many legitimate comments appearing in Akismet – including some from people who had commented before – and I had to manually de-spam them, often the same person multiple times.

Google Domain Parking Arbitrage

Richard Ball has a great write up concerning Google’s Adsense for Domains program and potential abuses. He is concerned that certain keywords being bid on through Adwords are producing garbage traffic.

A whopping 72% of clicks for a single exact match keyword originated from the searchportal.information.com domain. Investigating this domain, it turns out to be owned by a company called Oversee.net that owns DomainSponsor, a parked domain operation.

What Richard seems to miss is why the traffic is garbage. It’s because Information.com is one of the largest arbitrage 1.0 operations around. The reason it doesn’t convert is because Information.com bids on long tail search words for cheap and then send the clicks to ads targeted at the high paying general search terms. Terms which may be related, but are not actually what the user was searching for.