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Opinion: Grist for the marketing mill

Why advertising agencies lose clients

Anyone working for an ad agency will know that one of the most desperate feelings on earth is losing an account. More so, perhaps, than most other businesses because in the majority of cases agencies lose clients for reasons totally beyond their control.
My worst experience of this was 40 years ago when I was a copywriter for Lindsay Smithers in KwaZulu-Natal and we were pitching for the India Tyres account. This was the first time, incidentally, that a video recorder was used in an agency presentation. Anyway, we put our hearts and souls into it, did the presentation and the client loved it. All that needed to happen, he said, was to sign the contract.

Two weeks went by without a word. Eventually he plucked up the courage to face us and sheepishly admitted that when he showed our campaign to his boss (who was marketing director for both India Tyres and its mother-brand, Dunlop) he was told that the India advertising was so strong it would diminish the Dunlop brand value, and it therefore had to be "toned down", or what we would today call "dumbed down."

We suggested they go and get stuffed.

A lot of that sort of thing still happens today.

International account realignments are also among the most common reasons for agencies losing accounts and probably among the most frustrating. There is simply no recourse, no way of trying to rescue something. This is heartbreaking, demoralising, and just plain unfair in the worst possible way.

But, in the few cases where agencies actually lose accounts because they are not performing to the client's satisfaction, one of only two scenarios is usually played out.

The human factor

The first is a situation where the intellectual capital of the agency is simply on another and much higher plane than that of its client. It is no secret that a lot of clients are riddled with unskilled, untrained brand and product managers who not only find it difficult to make decisions but inevitably when they do, they are based on either pandering to the perceived wishes of their bosses or on avoiding any possibility of risk.

The second is just plain bad communication. Thankfully, today, more and more clients are realising that the success or failure of their advertising agency in terms of the work they do and strategies they create is very much based on the human factor, more particularly compatibility. It has nothing to do with producing bad advertising.

For an agency and client to work together, both teams need to have relationships not too dissimilar to those required to make marriages work.

Of course, there are still far too many agencies and even more clients who simply pooh-pooh the importance of compatibility. Which is strange indeed, because it is so basic a tenet of human nature.

The solution...

Even the most superficial research into agency/client failures will show that by far the most common cause is purely and simply the inability for the two parties to understand each other.

It is the answer to why in just about any agency one cares to mention, there is a history of doing wonderful work for some clients and really screwing up badly on others.

A clue to whether compatibility exists certainly seems to lie in the structure. Those clients that involve their agencies and make them part of the team more often than not find they have a successful situation. Those that treat agencies simply as outside suppliers and nothing more inevitably end up gnashing their teeth and shedding tears.

I am convinced that there is no such thing as a bad agency or a difficult client. Just people who cannot see eye to eye.

Yet that's the last thing most clients look at when they putting their account out to pitch.

In my experience of finding ad agencies for clients, the system that works best and leads to the longest relationships and most efficient advertising, are those that are started not by asking agencies to produce creative ideas in the pitch process but simply sitting down with them to find out if they can get on with each other. This method is the most logical and incidentally, the cheapest by far.
    
 

About Chris Moerdyk

Apart from being a corporate marketing analyst, advisor and media commentator, Chris Moerdyk is a former chairman of Bizcommunity. He was head of strategic planning and public affairs for BMW South Africa and spent 16 years in the creative and client service departments of ad agencies, ending up as resident director of Lindsay Smithers-FCB in KwaZulu-Natal. Email Chris on and follow him on Twitter at @chrismoerdyk.
Rolf Akermann
Well stated as usual Chris. There is another issue that causes agencies to loose accounts. The change of staff of the client. It is a well known fact that when a brand / marketing manager changes, the chances are they are going to change agency. It has nothing to do with the quality of work, but rather the relationship factor. I lost an account after 15 years, during which I had 6 different "clients". Trying to have a good relationship with so many different personalities is set to fail at one point or another.
Posted on 17 Jun 2014 10:56
Sid Peimer
Thanks Chris. My tuppence: the reason relationships break down is that the problem that needs to be solved has not been found let alone articulated. So agency just produces better and better advertising, and client gets more and more dissatisfied. Funny how sometimes an agency gets fired as soon as the work becomes brilliant.
Posted on 17 Jun 2014 17:15
Gerhard Bouwer
The politics of dancing is sometimes a reflex reaction.
The knowledgeable contact person is unfortunately not always the best one.
Which is why we seem odd and creepy when asking for a shuffle with a know-it-all young one.
Which comes back to your iconic pitching is like dating (thank you Sid).
Posted on 17 Jun 2014 18:39
Mark Schefermann
Great article, so true.
Posted on 18 Jun 2014 22:23
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