Why Do We Permit Our Clients to Abuse Us?
Freelancers, consultants and small direct marketing agencies can make the difference between success and failure for multi-million dollar businesses. But you would never know it by the way prospects and clients sometimes treat us.
I have great clients who do not fit the descriptions below. But I must admit that I have worked for such clients in the past and find that they permeate the new business scene. So my chances of working for one of them again are very real.
For the last quarter of a century, clients have demanded speculative work requiring no remuneration as a rite of passage for their new business. But this trend has exceeded the original bounds.
It is one thing to create plans and speculative creative work or research for a prospect with a $10 million budget and another thing to do the same for a prospect with less than $100,000 who expects the same treatment.
Many prospects do not understand the effort it takes to come up with a campaign budget. Or if they do, they still require that the consultant spell out for them what it will take to solve the problem.
They are not content to know what YOUR time budget requirement is. What they really want is a turnkey budget to solve a problem without paying you a dime to create the solution.
The time required to answer this question costs the same as it would for a large budget. And winning the business --- which is by no means guaranteed --- barely pays for the process of coming up with such a budget!
Most consultants will price out the PROCESS for the prospect to solve the problem. But they will not provide turnkey budgets unless there is at least a 75% chance of winning the business.
Or better yet, many consultants will charge the prospects for the time and skill required to come up with the turnkey price required to solve the problem.
The turnkey pricing process to solve a direct marketing problem requires strategy formation, tactical implementation steps and creating estimate specifications for the printer, the lettershop, the telemarketing service, the service bureau, list rental costs, projections of counts for the target audience ad infinitum.
Most clients have no idea that pricing in our business means that the campaign requires hours of planning and preparation before pricing can happen. The consultant must create the campaign and create specifications in a vacuum without adequate input from primary research or the client to price the campaign with any degree of accuracy.
Just once, I would like to say something like this.
“Before we can price your campaign, we need to know what it is. What is the size of your target markets with net list counts? What media mix do you need? Give us the specifications for your direct mail and collateral materials. (And the list goes on.) If you cannot answer all of these questions, then we need $10,000 to come up with the specifications to achieve your sales objectives.”
Unfortunately, clients want a lot for no upfront commitment sometimes caring little about what our small businesses must go through to earn even the smallest projects.
The only solution to this problem comes back squarely on the shoulders of the consultant. Refuse to provide turnkey budgets without financial commitments for preparing such campaigns. We must turn away this intentional or unintentional abuse.
Without such discipline, the consultant cannot succeed long term.
The major reason for accepting this treatment in the first place lies with the agency or consultant that does not possess a proactive and successful new business program.
Without an active new business plan that works, agencies allow themselves to get trapped in a no-win situation. They feel obligated to accept ANY business that comes down the pike regardless of its size or quality.
Are you are one of those agencies or consultants that accepts anything that comes down the pike. Ask yourselves why you are doing this. I think you will conclude that it has to do with the fear of turning any business away when you do not see other options for attracting new business.
This vicious circle of giving away the store has little to do with prospect abuse and a lot to do with our own ineffective new business strategy.
So set out today to solve this problem for your organization. Only a projectable and consistent new business strategy will cure what ails you.
Have you been guilty of letting clients and prospects abuse your professionalism and talent? If so, why do you do it? Do you think the problem can be solved? If so, what advice would you give the rest of us to control the situation?
Ted Grigg
3 Comments
View Printer Friendly Version
Email Article to Friend
Reader Comments (3)
Unfortunately, we have been guilty of this. But, we've learned by our mistakes (the good news!).
If we are unsure about the actual opportunity and know that providing the prospect with a strategic game-plan and recommendation of how they should proceed will take hours of work, we structure our proposal in several phases.
Phase 1 consists of a needs assessment/discovery/info gathering phase where we articulate exactly how we'll evaluate their situation. We have proven methods and tactics that we use for this info gathering phase. And, we assign a price tag to it. The key deliverable for this Phase 1 is the marketing gameplan which will include recommendations and program-specific costs.
We'll include overviews of Phase 2 (which typically is the marketing plan), Phase 3 (which typically is implementation) and even Phase 4 (which might be measurement and applying knowledge to future programs). Again, we include an overview of these phases, but we don't include pricing.
With this type of approach, we can gauge whether the prospect is serious about working with us. We also give them a fairly low-cost way to start the process of working together very quickly.
Perhaps most importantly, we don't de-value our time and our experience, because we charge, essentially to build recommendations that include our services in the future.
Does this approach work all of the time? Heck no. But it's a proven approach for our business.
I do pretty much the same thing. But few prospects agree to it. They want their cake and eat it too.
Their rationale for not approving this phased approach is that they have a limited budget and need to know what the whole thing costs before spending dime one on it.
But those who do agree to it make great clients.
Thanks for your comments.
Ted
Ted,
Dead on, per usual. As the old data saying goes, Garbage in, Garbage out. The most successful relationships start with a collaborative approach where information, including, GASP!, budgets, are shared. I also employ the phased approach because it's equally critical that the relationship is exactly that. I want the experience to be positive for both sides, theirs and mine.
Once respect is established and the results are tallied, most clients are happy. Nonetheless, the challenge remains and we must all work hard to be honest and upfront at the onset or be willing to walk away when the information needed is not provided.