Client Retention Is NOT a 4-Letter Word

IMG_0143Client retention and the seemingly ever-present threat of client churn keeps public relations agency principals up at night. If you know any, just ask them.

Client retention keeps other agency leaders, like vice presidents and account directors and account managers up at night too.  If it doesn’t, well they’re in the wrong role.

There are so many good reads re: client retention advice out there that I dare not try to list them here.  But there are a few that stand out.  One in particular is the Tenacity Clients for Life Blog.   I highly recommend you check it out.  John Gamble and Steve Wurzbacher have been consulting companies on client retention for close to 30 years.  If client retention is important to you, you’d be remiss if you pass on their posts.

But while reading what the experts advise is often very helpful, those of us (and that may mean you) who have been living the agency life know that client retention doesn’t have to be a 4-letter word.  If you have ever been on the receiving end of a phone call where a client is firing you, then you know EXACTLY what I’m talking about.

100 per cent client retention is not possible.  If you think it is, you’re living in La-La Land.

But a high level of client retention (70-80%?) is possible.  And a business requirement if a firm is going to prosper.

So what are a few of the keys to client retention?

First and foremost, every prospect should be looked at by an agency individually.  What is your client acquisition strategy to help create and sustain value for a particular prospect?  It’s always easier said than done, especially when business is soft, but if more agencies closed the door on non-aligned business, client retention rates will edge up.

Secondly, take a really close look at why clients leave your firm.  There are as many reasons as there are clients.  But outside of M&A and financial issues (Chp. 11), core reasons for losing a client likely include the following:

  • you’re not acquiring the right clients under the right terms
  • you’re not proactively managing and measuring the expectations and the value of the agency-client relationship
  • your new business team is held in higher regard, are the agency “rock stars,” than are members of the client relations team; the reward for bringing in new business is higher than the reward for retaining business or growing existing business.

What’s your client retention magic?

Stay tuned for a few more ideas on how to keep client churn below the industry average.

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Bill Belichick Is Not An Android Afterall

1374692483000-bill-belichick-1307241713_4_3As it turns out, he’s made of the same things you and I are, flesh and blood — not synthetics. Who knew?

Bill Belichick, the anti-PR head coach of the New England Patriots football team, showed yesterday during the new season’s first press conference that he’s human.  He hurts much like you and I do.

While it took a tragic event, specifically the death of a young man and murder charges against one of the Patriot’s star players, for Belichick to display his human side, he rose to the occasion.

On June 26, 2013, Patriots star tight-end Aaron Hernandez, 23, was charged with murder in the first degree in the shooting death of a friend Odin Lloyd, 27.  The Patriots released Hernandez from the team later that day, though Belichick and team owner Robert Kraft were out of the country at the time.

One month later, Belichick stood before the lights and cameras of TV crews and a slew of newspaper reporters at his team’s stadium in Foxborough, Mass., to address the horror that unfolded just four weeks prior.

On this day, he left his famous gray hoodie in the locker room and looked more business-like behind the podium.

In a prepared statement, Belichick began the arduous task of rebuilding the once great but now tarnished reputation of the New England Patriots.  One press conference won’t get the job done.  Among other things, the team will have to execute flawlessly against their promise to reevaluate their system for vetting players before offering them life-changing contracts.

But yesterday, Belichick did just about everything right.  He put aside the team’s famous abstract playbook and instead read from the franchise’s book on crisis communications:

1, He proactively addressed the issue using a carefully crafted and thoughtfully prepared statement which answered many of the questions news organizations were anxious to ask.  He emphasized the crisis is bigger and more important than the organization.  “My comments are certainly not in proportion to the unfortunate and sad situation we have here.”

2, He used words that evoke emotion; words the bind us all together.  Belichick said he was “shocked and disappointed” by the tragic events.  “It’s a sad day, a really sad day on so many levels.”  Many of us feel the same.

3, He didn’t deflect blame and took responsibility.  As the person primarily responsible for signing players, Belichick said, “…I’m personally disappointed and hurt in a situation like this.”

4, He restated the organization’s value set.  “We have so many players … that do the right thing and that set a great example of being a professional and being a solid representative of this team and community.”

5, He stayed in the present (this problem won’t disappear for quite some time). But committed to the future.  “Moving forward consists of what it’s always been here:  to build a winning football team, be a strong pillar in the community, be a team that our fans can be proud of.”

For the New England Patriots reputation, there’s no place to go but up.  Yesterday, Bill Belichick got the process off to a pretty good start.  Don’t you think?

Anyone Can Do PR — Easy As 1, 2, 3

ImageWhy pay big money to a PR firm when it’s so easy to get media coverage? Here’s how to do it on your own.

That’s the sub-head of sales guru Geoffrey James’ most recent post in Inc.com.

What the…?

Wait.  There’s more.

PR firms can be pricey and they’re often not all that good at landing media coverage,” James says.

I know people who are paying as much $10,000 a month to a PR firm and getting very little out of it,” he continued

Said Mr. James:  “And that’s sad, because PR–getting positive media coverage–isn’t all that difficult.”

A bit later in the post, James throws PR a bone with, “I should probably note that there’s some ‘art’ involved in figuring out story angles.”

But he no sooner giveth that he taketh away with:  “…and most PR folk don’t do it very well.”

In his next breadth, he pretty much throws the newspaper reporting profession under the bus with, “If you need help, consider hiring an out-of-work newspaper reporter. There are plenty to go around.”

Perhaps James — who writes mostly about sales and marketing for Inc. — woke up on the wrong side of the bed following a bad experience with a public relations agency and then decided to trash the entire industry.

Or, perhaps he really believes that generating favorable media coverage is as easy as 1, 2, 3.

What is for certain is that James has a pretty low opinion of an industry that is growing about 8 per cent a year, generates nearly $11B in annual revenue and employs nearly 75,000 people around the globe, according to The Holmes Report.

So at least a few companies — from start-ups to global organizations — see the value in hiring a PR agency.

Granted, James’ post is focused on new companies vs. larger, well-established ones.  But at the same time, encouraging entrepreneurs to do their own PR is encouraging them to take their eye off of their core competency (developing a product, building out a service offering, etc.) and to drink their own Kool-Aid as not only do PR people develop their skills and media relationships over the course of years, but they are the best at sniffing out the B.S. that some entrepreneurs try to pass off as news.

After James takes his readers through the very basics of PR, he concludes his post with, “As you can see, there’s no big mystery to doing PR work.”

What the … Mr. James?  As one of his readers commented, with his advice James is giving false hope to business owners.  Don’t fall for it.

Chemistry Ignites the Agency – Client Relationship

imagesAll other things being equal, “chemistry” between a business prospect and the prospective public relations agency account team is very often the difference between winning the business and coming in second.

Think back to that time — I’m sure there were several — when you and your excited account team walked into a prospect’s conference room only to be met by poker-faced business people who backed up their expressionless faces by skipping informality.

Now think back:  how did the pitch go?  How difficult did the prospect make it for your team to be at ease so that they could put on their best show?  How hard did the prospect work to make sure they were in control vs. working hard to communicate that they were equally excited and had been looking forward to the meeting?

Did you win that business?  Did you even want that business?  Could you do your best work for that client?

As experienced agency executives know, the chemistry — or lack thereof — that happens during that first encounter with a prospect is often indicative of what the “working” client-agency relationship will be like.  Chances are good the agency will be treated like a supplier and not a partner.

Now think back to the other time — and I know there were many — when you and your excited account team walked into a prospect’s conference room and were met by equally eager business people who warmly greeted you with smiles, hearty handshakes, and an appreciation of the hard work the agency invested in the opportunity.

How did that pitch go?  How much more at ease were the junior members of your team made to feel by the prospect’s genuine interest in their background, their relevant experience, and their ideas for the program?  If they had a sense of humor, if they asked questions to better understand your ideas vs. to put you on your heels, if they wanted to know a little about your personal life too, well, I bet you thought that pitch went pretty well.

Perhaps you didn’t win that particular piece of business.  But I imagine the idea of  working with that prospect was appealing.  It was business you wanted.

All great agencies will pull all the stops for the opportunity to earn a prospect’s business.  If it’s worth chasing, then it’s worth doing everything possible to win it.  Otherwise, why bother?

If you read David Kean’sHow Not to Come in Second,” published in 2006 but timeless in its teachings, then you know about his eight ingredients for pitching:  be organized, know your audience, solve the problem, price properly, deliver a great presentation, generate unstoppable momentum, and demand feedback (win or lose).

Take a leap with me for a moment and assume all great agencies, whether they be disciples of Kean’s teachings or not, have a methodology for not coming in second.  Assume for a moment that a prospect is meeting with three great agencies.  During the pitch phase, each agency demonstrates proven, relevant experience;  the ability to generate breakthrough awareness levels; creative program ideas; and the ability to be an excellent business partner.

Wow, tough decision for the prospect, but a good problem to have.  So how does the prospect ultimately decide on a new agency in this situation?

Chemistry.

Who does the prospect want to work with day-in, day-out?  In good times and when times get tough? Who does the prospect want to celebrate victorious campaigns with?   Or re-build with following a crisis?

Chemistry is about a special connection between account team and client.  Typically, that connection is obvious — if it’s there — during the very first meeting.  It’s intuitive.

The importance of chemistry can’t be underestimated when it comes to selecting a business partner and cultivating a relationship that maximizes value for both parties.  C.G. Jung said, “The meeting of two personalities is like the contact of two chemical substances: if there is any reaction, both are transformed.”

I’d be interested in hearing what role you think chemistry plays in a business partnership.

Brand Building For Young Professionals: 6 Simple Steps

ImagePersonal brand and reputation building is big business.
It’s virtually impossible to keep up with the never-ending wave of “how to build your personal brand” articles and books. It’s especially tough for young people who are just out of college and are looking for their first professional job in an employment market that often favors candidates who make the most noise.
Twenty years ago, or even 10, I don’t think many newly minted college grads were paying too much attention to personal brand building.  And using technology to build a personal brand, or to start earning a reputation, was nearly non-existent.  Then, one relied more on word-of-mouth and good old fashioned networking.  But today, the social network LinkedIn provides young, professional job seekers with the best platform ever for showcasing in full view of prospective employers their ambition, passion, competency, business smarts and networking savvy.
Like anything else, though, a tool is useless in the wrong hands.  For LinkedIn to become a true personal brand building solution, there are a few rules of the road.
I see too many young people — interns I have worked with, the sons and daughters of friends of mine, etc. — who are wasting a great opportunity by not investing time in LinkedIn. Meanwhile, those who get it — like Dan Schawbel and his disciples — are reaping the benefit.
Schawbel has built a tremendous business by advising Millennials on personal brand building. While there are scores of other personal brand building experts, Dan’s focus is on Millennials (young people who are generally in their 20’s and early 30’s, the focus of this post) who are just starting out. One of his books, “Me 2.0:  4 Steps to Building Your Future“, has been a best seller here and across Asia and Europe.
For young job seekers who may not have the time, or who are unwilling to make the time to read Dan’s or others’ books or attend the many personal branding seminars that are available, there are six relatively simple steps they can take on LinkedIn to grow their personal brand and begin to build their reputation as someone with something important to say.
Here are my six:
1. Can the profile picture of you at a party, or at an event or on vacation. Save those for
ImageFacebook.  And kill the glamour picture unless you’re in the entertainment industry.  Replace with a straightforward head on shot of you in professional attire wearing a nice smile.
2.  If you don’t yet have relevant work experience for your intended field, then fill your profile page with relevant skills instead.  For example, if you want to work in public relations but spent your college summers working as a waitress or waiter at Texas Roadhouse, then let’s hear about your customer service, problem solving, team building and communications skills. Find the relevance.
3. Build out your LinkedIn network.  To start, connect with college classmates, your professors, high school classmates who went to a different college than you and may already be working. Also, connect with your parent’s friends who may run their own small businesses or may be employed by big companies.  I guarantee they will be happy to hear from you. Don’t forget the professionals you talk with at the health club, or people you meet at summer weddings and graduation parties.
4. Ask for LinkedIn recommendations.  Don’t be shy about asking for help from managers you may have interned with, past summer employers or professors you may have assisted.  If you did good work, they will not refuse you.
5. “Follow” companies on LinkedIn you think may be a future employer.  Then visit their LinkedIn page and see who you may already know who works there.  Reach out to them even if you don’t see any jobs of interest posted.  Many open positions are never posted and those who are best networked often get first dibs.
6. Get involved.  Join a handful of the thousands of available LinkedIn groups. Guaranteed there will be groups in your chosen field no matter how obscure.  A couple of times a week visit the groups and eavesdrop on the discussion.  When you think you can contribute to a discussion, weigh in.  After the first time, it gets easier and easier.
Give LinkedIn your best shot.  Your competition already is.

Millennials And Boomers: Hardwired To Be Different Consumers

ImagePerhaps the differences between Baby Boomers and Millennials begins with the fact that there’s ambiguity about the birth years of the latter (early 1980s to the early 2000s).  But a boomer is a person who was born during the demographic Post–World War II baby boom between the yeiars 1946 and 1964, according to the U.S. Census Bureau.  No ambiguity there.  Millennials are simply harder to pin down.

In the U.S., Millennials and Boomers represent roughly the same number of consumers-but that might be where the similarities endThat’s the opening salvo in an updated report by Nielsen NeuroFocus entitled, “The Me Generation Meets Generation Me,” with the central point being that both demographics are in equal demand by advertisers. But for advertisers to be successful in reaching and engaging boomers and Millennials with brands, they have to understand the vast differences between these two coveted consumer groups.

Boomers have most of the gold.  We represent more than 40 percent of all new car purchases, 80 percent of leisure travel spending and account for half the spending on consumer packaged goods.  And this aging population group accounts for nearly 80 percent of what is spent on prescription drugs.

And while those aged 19-36 have, for the most part, yet to accumulate any real wealth (they are, in fact, facing academic debt of epic proportions, which is one reason they are not buying new cars and going to Aruba), they spend more than 80 percent of their income and represent 25 percent of the U.S. population (and 30 percent in each of Brazil, India and China). Millennials are a big target, no matter how you cut it.

One of the areas boomers and Millennials fine a common thread is use of technology. Boomers love technology.  After all, many of us were in our 20’s, 30’s and 40’s during the rise of PC’s, then local area networking, then the Internet period and finally the .com boom.  Though, while boomers embrace technology in our every day lives, we still tend to be tethered (I’m writing this post on a desktop PC with a 22-inch screen).  Many boomers have yet to give up their land lines and for the most part, we watch our favorite programs on 40+-inch HD TVs hanging on a wall and have to be home to receive delivery of the daily newspaper.

Millennials, on the other hand, think land lines are redundant and ridiculous, watch their favorite programs on-the-go on 4, 7 and 10-inch screens and consume all of their news digitally.  My two Millennial daughters are home for the summer, and they bring the Nielsen report to life everyday.

So how do advertisers get better at engaging boomers and Millennials?  Well, Nielsen thinks the answer lies in understanding how these groups are hardwired.  As the brain ages, the report says, it craves repetition which breeds familiarity.  But a younger brain responds more favorably to a more dynamic, ever-changing presentation.  And while boomers lose, with age, their ability to compartmentalize information, Millennials are better equipped to handle “bleeding-over communication”, like banner ads.

Mad Men didn’t have access to anywhere near the levels of neuromarketing research, if any all, that advertisers enjoy today.  Madison Avenue didn’t need to think about how the drop in dopamine and serotonin levels in the aging brain would impact how brands communicate with prospects.

But things are vastly different for today’s advertisers.  Brands that work the hardest to understand the triggers for boomers and their children will walk away winners.

5 (more) Reasons Why a Company Needs A (good) PR Agency

ImageThe blogosphere is jammed with “expert” opinion on why a company should or should not hire a public relations agency.  And is equally jammed with posts on the questions a company should ask before considering a relationship with an agency, like this one.  Any company planning to bring a PR agency on board for the first time or possibly replacing their existing one should spend considerable time reading the pros and cons of hiring an agency. There’s no shortage of opinions on the subject.
In one corner are the experts who believe they have been burned by a PR agency or just think they can do as good a job — or a better one — promoting their brand without outside counsel.  For example, 5 reasons you’ll regret hiring a PR firm for your startup — and what you should do instead, by Kevin Leu of GirlsOnAMap.com and published in “VentureBeat” tells us that “nothing could be more dumb than throwing your hard-earned venture capital money at a public relations firm.”

Really?

Mr. Leu is entitled to his opinion, of course, and his spirited rant on how PR agencies don’t know how to tell stories, rest on their laurels, and are nothing more than a big rip-off garnered his post fairly broad readership and pages of comments.  But the post is full of gross generalities IMHO.  Do bad PR agencies exist?  Of course, and Kevin has apparently seen more than his fair share of them.  But to lump all agencies in the rip-off bucket doesn’t make any sense.  And simply isn’t fair.

A former colleague of mine, Patrick Ward, followed up Leu’s post with a more measured response in Here we go again:  5 reasons hiring a good PR firm is smart business.   In it, Patrick counters that an agency will keep your story honest, they’ll leverage their influencer relationships on the client’s behalf and they provider greater value than an internal employee.
Leu’s opinion of agencies aside, the public relations industry continues to outperform global economic growth.  And PR consistently ranks among the best industries to start a business due to its low cost of entry (with that said, the PR industry is perhaps more competitive than anytime in recent memory). So if the raw number of PR agencies, from the three-person boutique to global shops, is any indication of the value businesses place on the profession, then PR is clearly filling a vital business need.
Sorry Mr. Leu, but here are

5 More Reasons

  1. When a company hires an agency, it’s hiring a team — not an individual.  This means the client enjoys the benefit of the vast network of influencer relationships that the agency, vs. what an individual, can bring to the table
  2. Agency professionals build relationships with journalists, bloggers, etc., with two key purposes in mind: to assist the influencer in doing their job and to leverage these relationships on behalf of their clients’ stories.
  3. A good agency doesn’t let its staffers drink the client’s Kool-Aid.  An agency will tell you if your stories are stale and will uncover new ones in your organization.  An agency will tell you if your new product is an also-ran and will help find ways to position it in a positive light without overstating the benefits.  A good agency staffer will tell a client when they’re wrong, and how to make it right.
  4. Good agencies become true extensions of a company’s internal team.  Once the agency team establishes strong, trusting relationships with the client, products and audiences — aka, the brand — they will deliver the same levels of authenticity and passion as do in-house team members and will do so without the distraction of in-house corporate politics.
  5. A good PR agency person is a content creator at heart.  Agency people create client stories like it was their own to tell, and messages that cut through the B.S.
So there you have my five reasons why a company needs a PR agency.  Please share your own reasons or comments here on “What it Takes.”