3 Reasons Your Agency Relationship Will Fail

August 09 2018

3 Reasons Your Agency Relationship Will Fail

3 Reasons Your Agency Relationship Will Fail

In reflecting over Bulldog’s 14-year history in enterprise B2B marketing, we’ve had engagements that have been wildly successful—and some that have crashed. When I reflect on the differences between the two, it’s tempting to think like Forrest Gump, “Life is like a box of chocolates—you never know what you’re gonna get.” That’s just the nature of the services business, right?

But that’s an unsatisfying answer.

It feels lazy.

So, I started digging deeper: What do our most successful engagements look like? As an agency principal, this is powerful information. If we could isolate and identify the right combination of characteristics, we could do a better job of hunting for best-fit clients.

What do our best clients look like? Are they in a certain industry? Do they have a relative level of marketing maturity? Do we perform better with very sophisticated clients that have embraced technology and rely on data? Or maybe it’s more role-based? Do we deliver better results when we have CMO involvement versus a manager or director? My leadership team and I have spent many hours looking at every single data point we could think of and track—but quantitative analysis didn’t yield any clear insights.

We only began to make real progress when we flipped the question on its head and asked ourselves: What do our worst engagements look like? When we did that, we quickly identified patterns that had nothing to do with firmographics or demographics.

The findings were fascinating.

The Big 3

We identified more than a dozen characteristics that we identified as risk factors; client attributes that limited our ability to deliver the best outcomes and drive high customer satisfaction. Stack-ranked, here are the top three.

1. MISSION & ACCOUNTABILITY

We found when we looked at our lowest-scored engagements, the most common denominator was lack of clear understanding of mission or purpose. Said differently, our client relationships struggled the most when we did not have a clear understanding of business goals and expectation of engagement outcomes. As we dug into this first finding, we found several variations.

The first and most common situation: A client did not define a clear expectation and/or did not have any real accountability to an outcome. Our experience was that over time, team members from both the client and agency side developed their own independent versions of the truth. Creatives focused on creative, techies focused on technology and data, and media or social web folks focused on media or social web metrics.

The result: In the absence of a broader business goal, everyone's focus shifted to tactical excellence in delivering point solutions. While we may have developed the best banner ad, designed the best email nurture, or built the best lead scoring algorithm, we didn’t necessarily move the needle on key business drivers like client attrition, sales pipeline growth, or closed-won revenue.

In retrospect, I think this is a challenge for any agency/client relationship. While we have a comprehensive onboarding process that is designed to tease out business objectives and success metrics, it only works when our clients are committed and being held accountable to performance outcomes.

A second situation worth mentioning is when corporate priorities shift. This happens all the time. Our clients, which are large enterprise public (and usually global) companies, are busy as hell. They are constantly making acquisitions, they are constantly introducing new products and solutions, and competing with new and disruptive companies and technologies that are working feverishly to steal clients and market share. There are always a new set of urgencies that, at times, disrupt or displace the business plan and budget.

IN REAL LIFE

About 18 months ago, one of our clients had to deal with a public relations (PR)—and potentially IR—crisis. They got into a very public dispute with Google about the integrity of their business and service offering.

At the time, we were more than eight months into an annual plan that was tied to business objectives that had nothing to do with the incident at hand. Our client team, which was focused on campaign and program KPIs in the days and weeks before the crisis, changed priorities overnight. Our client’s brand, reputation, and business were at stake. In an instant, everything had changed. Our stakeholders disengaged, and our work and the engagement itself became almost irrelevant.

When I think back to the situation, I ask myself what we could have done differently or better. While I’ll address this in more detail below where I discuss “relationship,” I think we acted in our own self-interest as a vendor, not as an extension of our client’s. Our priorities and MISSION should have changed the moment our client’s did.

 

2. FOUNDATIONAL BUSINESS CHALLENGES & AUTHENTICITY

The second characteristic we identified spoke to the limitations of marketing. It is undeniable that great marketing is a powerful weapon that can unleash sales and revenue growth, but it’s not a panacea. Even great marketing can’t fix a bad company, a bad product, or a bad sales process.

Marketing can only take you so far. Inferior products seldom win the hearts and minds of customers. Sometimes, aspirational messaging can amplify the right behaviors within a brand by creating clarity and underlining a mission. This can happen when there is genuine intent to differentiate from the competition in a very specific way—and the right leadership and investments to make it happen.

Over the years, we have worked with many brands that are “laggards”—meaning, they aren’t the number 1, 2, or 3 in their category. Sometimes they’re number 5 or number 7. Nevertheless, they’ve been successful in growing despite their industry ranking. Sometimes they’re growing because of great sales strategies or strategic mergers and acquisitions.

Some of them talked the talk when it came to rationalizing why they weren’t as competitive as the leaders in the space. The problem is when a brand isn’t willing to walk the walk. That is, they don’t focus their energy on making their business better—but instead invest only in the optics; i.e., building a story that's usually better than the reality. And that's the kind of behavior that gives marketing a bad name.

IN REAL LIFE

Several years ago, we had a publishing client with revenues of over $3 billion in North America. Most of their revenue came from print advertising, an industry that has faced intense pressure and disruption from new digital technologies and offerings. Our client gave consistent guidance about their ambition to transform their business into a modern 21st-century digital powerhouse. It was a great aspirational message that pacified some shareholders and creditors—but didn’t guide their investing and staffing strategies.

At the time, it was our biggest engagement to date and we couldn’t have been more excited about the challenge. We developed powerful positioning and messaging for them. Our lead management and sales routing efforts reduced time-to-sales engagement from over 72 hours to about 20 minutes. We built real-time reports and dashboards. In under a year, we drove more leads, pipeline, and revenue than any new initiative our client had launched over the previous five years (from about $80 million to more than $200 million pipeline).

By all accounts, it was a successful campaign—but it felt like we won the battle and still lost the war. The company was battling massive customer attrition, losing more than six percent of their top-line revenue every quarter. For every new dollar of revenue created, the company was bleeding 3:5. At the end of the day, marketing couldn’t fully transform or save the company. They were a legacy analog company that made big investments in painting a picture of a digital future—but didn't invest in the digital offerings to get them there.

 

3. RELATIONSHIPS

I know this one seems obvious—but indulge me.

Our best clients are usually people and teams of people that want to affect change. They are open to new ideas and new ways of thinking about their business and they embrace the idea of going to the outside to figure it out. In short, our best clients are people who are naturally curious.

When we genuinely felt like we were an extension of our client teams AND our clients genuinely felt like we were an extension of their teams, the dynamic of communications changed radically. Our best client engagements happen when we have the confidence and trust to “think out loud.” When there is less demand to arrive at the table with answers, we can instead spend time making sure we’re asking the right questions. This may sound like nuance, but it’s not. Our least successful engagements always had a relationship that stifled candor and lacked freedom to explore different possibilities.

IN REAL LIFE

About six months ago, we fired a client. We are a relatively small agency (a little over 100 team members). We consider ourselves a boutique, in that we only work with about 15 firms at any given time. So, parting ways with any client is a decision we don’t take lightly.

The client was a $1 billion publicly traded device manufacturer. We were hired by their VP, who had worked with us in his previous job at another firm. As a brand, they were a laggard in their industry—but not because of their product and solution portfolio. They were competing with an 800-pound gorilla that was outspending them by almost 100:1.

The first engagement was about helping them get more value from the marketing investments they were already making. In just 60 days, we improved media ROI by almost 2x (measured in cost per leads, or CPL).

From the start, we advised the client that their media spend could only take them so far. We spent a lot of time and energy analyzing their business by exploring how decision-makers make purchase decisions. Our assessment: There were many other issues we could address that would generate a more significant impact to their sales pipeline and revenue, and we backed up our analysis with business case models demonstrating impact over time.

While many client team stakeholders agreed and embraced our recommendations, the CMO viewed us as a “vendor” playing in a narrow swim lane. Instead of engaging in discussion about how to move the needle in a big way, he wanted to debate specific search words or phrases. When we tried to shift the discussion and question the status quo, it triggered a defensive response. We were just another vendor in his eyes, not a trusted advisor and not an extension of his team.

We had already driven most of the benefit they could get from optimized SEM and media strategy. The engagement had a limited shelf life—with little opportunity for growth. In the end, we proactively made the decision to deploy our time, people, and energies to another client, where we could deliver better outcomes and grow our relationship.

 

LESSONS LEARNED

This was a powerful exercise for us. It provided important insights that are shaping how we continue to evolve and grow our business and evaluate client success and health.

Whether you work on the client or agency side, I hope you found this useful and informative.

Are any of these same issues preventing you from getting the most out of your agency or client relationships?

 

“I started Bulldog in 2004 and since that time, we’ve helped hundreds of Fortune 500 and Global 2000 companies tackle complex growth challenges. We’ve worked with thousands of marketing professionals spanning many verticals across the globe. Our body of work encompasses many aspects of B2B marketing including technology, creative, business process, data integration, media and social, and our work has been recognized by industry leaders including SiriusDecisions, Forrester, and Frost & Sullivan—not for pretty pictures or clever taglines—but for delivering measurable impact for our clients.”

- Rob Solomon
  Founder & Chief Strategist, Bulldog Solutions

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