Agency advice: how to steady the ship when you lose a key client

So, what do agency leaders do when they get that dreaded call and it’s time to steady the ship?

The debrief is vital

Sam Budd, CEO + founder, Buddy Media: “When a client is lost, having an internal debrief is vital. This should look like an open, honest conversation about what went wrong, where processes broke down, and where delivery didn’t meet expectations. Leaders must ensure this discussion is constructive and supportive. At the same time, doors rarely close forever. We’ve had many instances where we’ve re-won clients after growing and evolving as a business. That’s why a positive exit and a smooth handover to the new agency are essential. By keeping the relationship intact, you ensure that your agency remains just a phone call away for future opportunities.”

Tyler Turnbull, global CEO, FCB: “In an industry that’s ‘never finished,’ there are always surprises. Whatever the reason, adaptability is key, and there are three key things that should always remain consistent. Most importantly, it’s people first. Communicate immediately and transparently – let the teams know as soon as possible what has happened and why. Provide context on the decision and make sure this message is delivered from leadership first. Create forums among the teams to share their concerns and anxieties – smaller groups are helpful forums for people to feel comfortable opening up about what may or may not come next. Be honest – this is a business that is built on resilience.

“We always know that there will be client shifts that are out of our control. Showing empathy and understanding as well as key support for all impacted is key. And the communication does not end with one meeting, it must be continual and present. Leadership teams should pay close attention to the pulse of what an agency is going through and be intentional about where it can help and innovate to continue to move the agency forward. It’s no secret that change can be shocking, but building a culture where everyone is in it together will make one of these so-called ‘surprises’ easier to navigate.”

Enhance client retention strategies

Cecilia de la Viesca, joint managing director, Passion Digital: “Client turnover is an inherent part of agency life, and it’s essential to normalize this reality. However, the departure of a large financially crucial client can have substantial impacts on the agency. As agency leaders, our immediate priorities in such a scenario would be to stabilize the agency and refocus our strategy. We’d start addressing our financials to assess the impact and realign our budget to manage all stakeholders’ expectations. Communication with the team is paramount; an open meeting to reassure and motivate staff would help maintain morale.

“Enhancing client retention strategies and investing in current client relationships becomes even more important than normal. An extra focus would be put on the marketing and new business team to cover the gap in revenue and we’d focus on industries or type of work where we have a track record. We’ve had this situation before as an agency, and we decided not to restructure and, instead, reallocate all staff to other projects and accounts, but we understand that tough decisions depending on the situation might be needed.”

Jon Harrison, co-founder, One Black Bear: “It’s tough when the call comes. And bad news usually arrives in threes... or fours and fives. It’s as if clients have an inbuilt but unintentional sense of when to deliver bad news. The important thing though is not to panic or begin a blame game. You’ve lost an important client but the next step is to ensure you don’t lose your most important people. Of course, you may have to trim headcount based on how much of a financial hit you’ve taken but step back a moment and concentrate on your remaining clients and workload. Look at the forecasts, not just in terms of income but workload and type of work. You don’t want that second and third phone call to come in because you jettisoned the people integral to making things happen for them. Most importantly though, be kind. A mentor once said to us, it’s the easiest thing in the world to be a good manager when times are great and the money is flowing but you’ll ultimately be judged on how you treat people when your back is against the wall.”

Tim Ringel, founder & global CEO, Meet The People: “Generally speaking, losing a client is always difficult for agencies as most agencies are people businesses, meaning their clients directly or indirectly pay for the salaries of agency employees. We try to be very mindful of ‘client concentration risks’ and do not build bespoke agency brands just for one client (typical HoCo behavior) as we try to avoid having to let people go. Of course, that doesn’t mean it will never happen but these conscious decisions mitigate these potential risks as part of managing a good agency culture and ecosystem.

“We speak very openly with our clients about their responsibility when dedicated resources are required to service a specific piece of business as changes to the team are usually triggered by changes at the client. Luckily MTP has more than 800 full-time employees across our 8 firms – that allows for flexibility when needed and if employees are open to move around trades, locations and agency brands if in a crunch. Generally, we try to cover small and mid-size movement of clients within the means of our business objectives and motivate our people to think cross capabilities so clients leave less often and are “sticky” with the MTP group of agencies.”

Megan Stark, managing director, CubicICE: “When a client, regardless of size, decides to part ways with us, it always hurts. We respond with regret, honesty, and cooperation and take it as a learning opportunity. We start with an open discussion with the client to understand what went wrong and to identify areas for improvement. Once financial accounts are settled, we ensure a smooth transition. We assist in transferring all necessary materials, demonstrating our reliability and leaving the door open for potential future collaborations. Our team is encouraged to view the exit as a learning curve for improved service delivery for our remaining clients, which ultimately benefits them. The lessons and insights acquired in those instances and our commitment to quality service help ensure that we evolve to provide better services and achieve greater success for all the clients we work with.”

Have a ‘seen it all before’ plan

Kris Tait, managing director, US, Croud: “We get out of bed in the morning to service our clients, they are the lifeblood of our agencies and losing hurts. But losing a client is one commonality of all agencies, it happens, and when it does you need a calm ‘seen it before‘ plan. A loss gives everyone the rare opportunity to refocus, it brings clarity like winning does not. Where did it go wrong, how do we improve, how do we sharpen our product and service? The reality is that as leaders we need to reframe everyone's thinking in the aftermath and intentionally adopt a growth mentality, harnessing the frustration for good. Learn from the experience; action plan how we hustle new business; deepen current client engagements. A loss is only truly a loss if you do not learn from it and often a new and better client will emerge.”

Lee Climpson, partner/production director, Transmission: “A few years back, we lost a major client that had been with us for nearly a decade. It seemed like a blow at the time; however, it turned out to be a blessing in disguise. We used the opportunity to reassess our goals and strategically reposition ourselves. Instead of just focusing on replacing the lost revenue, we focused on attracting our dream clients – innovative, high-growth companies that were challenging their sector leaders and really wanting to be a force for change. Shifting our focus on to who we really wanted to work with resulted in us realigning our services with our vision, optimizing our market positioning and leading to a stronger, more focused agency. In the end, without doubt, the loss helped us better pursue our ideal client base.”

Marc Webbon, co-founder, Wonderhatch: “The priority is very simple – don’t panic! Checking in with my team is vital, giving them confidence in who they are and what they do, and reassuring them of the agency’s direction. The truth is that these things can happen, often for reasons beyond our control. It’s rarely a referendum on our relationships or work. An open debrief helps to understand the why. Everything that happens in business, good or bad, carries a lesson. Having the courage to learn allows us to move forward with confidence and be better for all clients – including those who might look elsewhere for a project or two. How you deal with a no is much more important than how you deal with a yes. Truly getting clients – what they need and how they think - is central to our DNA. Everything’s an opportunity to develop those relationships, even when retainers have come to an end.”