In this episode, Chip and Gini dive into the topic of agencies doing subcontracted work for other agencies.

Both share their personal experiences of starting and growing their businesses through such work. They discuss the advantages, such as faster decision-making processes and the opportunity to work with big clients without direct procurement hassles.

However, they also highlight significant risks like delayed payments, the potential for relationship conflicts, and the importance of clear contractual agreements. The hosts stress the need for transparency, proper onboarding processes, and clear communication channels to mitigate these challenges.

Key takeaways

• Chip Griffin: “It can be a good way to get started and to continue to grow, but you do have to think about it because the things that make it easy to get in are also some of the things that can also create some pitfalls for you.”
• Gini Dietrich: “It used to be that you would hire a contractor and white label them and have them work under your umbrella. Clients don’t care anymore, they just want the work done and they want to know that it’s being done well.”
• Chip Griffin: “Treat a larger agency with the same scrutiny that you would with any other client. Make sure that it’s a good fit and that you understand what the terms are and that you don’t do work before there’s an agreement signed.”
• Gini Dietrich: “There are some things you can negotiate, especially at the beginning of the relationship when you have leverage.”

Related

• Payment terms for agency subcontractors

View Transcript

The following is a computer-generated transcript. Please listen to the audio to confirm accuracy.

Chip Griffin: Hello and welcome to another episode of the Agency Leadership Podcast. I’m Chip Griffin.

Gini Dietrich: And I’m Gini Dietrich.

Chip Griffin: And Gini, we’re recording this just after the start of the new year, and I just, I don’t have a cutesy, fun, entertaining, awful, whatever you want to call it, opening, no, no. So we’re just going to, we’re just going to dive right into the topic, which is the idea of agencies doing work for other agencies.

And this is something that, that I know you’ve done, I’ve done it as well. And a lot of agencies, particularly as they’re getting started as they’re growing, end up doing subcontracted work for larger agencies or sometimes even similarly sized agencies that just, you know, need some excess capacity or the skills that you have to offer.

And I think there are, there are certainly some upsides to this, but there are some risks that go along with it as well. And so I think this would be a good topic for us to use to kick off the year, even though it’s the second episode people will hear in the new year, it’s the first one we’re recording.

Gini Dietrich: This is the first one we’re recording of the new year. You know, it’s, it’s interesting to think about this because that’s like, this is actually how I started my business. I was freelancing. I had quit my agency job and I was freelancing just to get through my wedding and get my, my then fiance moved to Chicago, like all this life change.

 And so I was doing work for other agencies, through other agencies on some of the bigger clients that I was accustomed to working with. And that’s how I built the firm. Like it was. I, the big agencies here in Chicago, I’d built such great relationships with people that worked there that they would say, Oh, well, this half a million dollar business is too small for us.

You should go talk to Armand Dietrich. Or this 250, 000 potential client new business is too small for us. You should go talk to Armand Dietrich. And they would send business to us pretty consistently. And that’s how I built the firm. You know, that, that died down after the Great Recession a little bit.

And then when we started to get a little bit bigger and they started to go, Oh, wait a sec. Maybe, maybe you could be seen as competition in, in, in some cases. But I, I probably spent three or four years just working through other agencies, in that, that way so that they, they were sort of the lead agency, but we were doing all of the work.

Chip Griffin: Yeah. I mean, I, I have a similar story when I first got started. I would say at least 50 percent of my business was subcontract work for larger agencies. I, I had a bit more of a mix of, of direct work, at the time, but you know, it still was an important piece of the business. And frankly, even as I grew, it still was a piece of the business because there were always larger agencies out there that I had relationships with and I had specialized skill sets or team members who could do certain things that were beneficial.

So it can be a good way to get started and it can be a good way to continue to grow, but you do have to think about it because the things that make it easy to get in are also some of the things that can also create some pitfalls for you, right? It’s easier to get in because you know their world.

A lot of times it’s an agency that maybe you had a relationship with before. You kind of know how they work. They know you. And so it tends to be a quicker, decision making process than it is for an ultimate end client that you’re going to work for. Because the agency that’s hiring you usually has a specific need and it tends to be pretty urgent. Because we’re in the agency world ourselves and we know that we don’t often have the resources at hand.

And so when we need it, we need it yesterday. And so that’s really appealing if you’re a small agency and looking for additional work.

Yeah.

Gini Dietrich: And I also think there’s, you know, you, you think about it from the perspective of large companies, most large companies don’t typically hire contractors, freelancers, or boutique agencies.

And there’s the idea that nobody ever got fired for hiring a big PR firm or a big ad agency, right? But they would get fired if they took a risk on a smaller one. And so there’s something to be said for continuing to, to sort of learn the ropes of running your own agency and processes and onboarding and all those kinds of things that you have to learn, hiring, hiring the right people, making sure that they’re the right fit, all those kinds of things that you have to learn as you’re building your agency. But doing it in sort of a low risk way where you’re getting a really good consistent revenue from a larger agency and still being able to work with those big companies that you probably wouldn’t get to work with otherwise.

Chip Griffin: Yeah. And it, I mean, it, it really makes that process a lot easier because you don’t have to go through procurement. You don’t have to deal with all of the headaches.

Gini Dietrich: Yes.

Chip Griffin: That come along with working directly for a large company, who in most cases won’t hire you directly anyway. In part because they know all of that bureaucratic stuff is going to weigh you down.

So it does open those doors. I think, you know, one of the challenges when you are taking on this subcontract work, particularly if it’s for a large client at the end of the line there, the large clients tend to abuse their own agencies. They pay them slow and those kinds of things. And so that trickles down to you.

And so most of the agencies that subcontract with you, they’re going to want to wait to get paid by the client before they pay you. And so if the, the big client is taking 90 days to pay them or more. You’re then going to be probably at least 120 days before you start seeing money. So it is, it is something that you need to go into at the very least with your eyes open that this is something that may happen and you need to get clarification over what those payment terms are. Because I’ve seen many times a small agency goes in and they don’t realize that that, that the larger agency is going to sit on payment until they get paid.

And, you know, we’ve had episodes where we’ve talked about how other agencies shouldn’t do this to, to smaller agencies, but they do. Some of the absolute worst clients that I’ve ever worked with in my career were other agencies, large agencies who basically inherit the bad practices of their clients and then magnify them.

And that’s just wrong. But it’s reality. And so if you’re going to go down this path of doing subcontract work, you need to understand that risk and either plan for it or say no, because you’re not willing to accept that.

Gini Dietrich: Yeah, and I think there are some things you can do in those instances, too, and I know that this is not what this episode is about, so I’ll just make this really quick note, but there are some things you can do, especially at the beginning of the relationship when you have leverage. And you can negotiate some of that stuff for sure.

You know, we have, we had a situation last year where the, a client, an agency that we’re working through for a really large client, wanted to pay us in six months. And I was like, no, no, no, like if you want to work with us, that’s absolutely not going to work. And so we figured out a way, it still ended up being 60 days, but 60 days is better than six months.

Still not my ideal, but. You know, if, if I had gone in, we’d still be working for free right now.

Chip Griffin: Right. Right.

Gini Dietrich: And it’s not happening. It’s, you can’t, you can’t run an agency like that. You can’t run a business like that.

Chip Griffin: Yeah. And I, I think it’s important to make sure that you’re asking these questions up front so that you understand what the relationship is going to be, because it’s really easy when you’ve got, you know, the, that, you know, mid sized or larger agency calling you up and saying, Hey, we need help.

We need to start yesterday. And you get excited because you’re going to be doing work for a big logo client and it’s kind of fun and it’s more money in the door, which is good. And so you just kind of jump in and then you start asking questions after the fact, because maybe you don’t vet another agency in the same way that you would an end client.

Gini Dietrich: Yes, you absolutely need to.

Chip Griffin: You absolutely need to because they are your client. While there is someone downstream, your client is that agency. And so you need to treat it with the same scrutiny that you would with any other client and make sure that it’s a good fit and that you understand what the terms are and that you don’t do work before there’s an agreement signed.

Because this is another. Agencies are very abusive when it comes to this. They’ll say, well, we’ll take care of the paperwork. Let’s just, can you just hop on a couple of calls this week and we’ll get this squared away. Don’t do it.

Gini Dietrich: No, the answer is no.

Chip Griffin: You need to go through the same process because as exciting as it is, you can get yourself into a world of trouble. Because it becomes a lot harder to extract yourself after you’ve already been on a few calls.

Particularly if those calls are with the end client.

Gini Dietrich: Yeah. Yeah. Yeah. And you have, you have to go, that’s a really great point. You have to go through the same onboarding, the same contracting, the same everything, you know, we, this, this one I mentioned before, they wanted to send us their contract and I was like, nope, nope.

We’re going to treat you just like we would our clients, even though the end client is your client and you are our client. So we, we did it. We did the same process and we were able to, like I said, at the beginning of the relationship is when you have the leverage. So you can’t do it, you know, two months from now or six months from now.

You have to do it at the very beginning of the relationship.

Chip Griffin: And I think it’s important to, you know, just as you’re trying to get expectations squared away on things like payment terms. You need to get expectations squared away on other important details, particularly communications. Because sometimes when you subcontract with another agency, they want to have you with a seat at the table communicating directly with the client.

It’s fully transparent. Other times they want you more behind the scenes so that they own the relationship. They’re protective of it. They don’t want you. I mean, if we think about agencies and their own small agencies and their own subcontractors, it’s the same thing. Sometimes you allow the contractor into the meeting.

Sometimes you want to keep them behind the scenes and, and own the relationship yourself. You need to understand what the expectations are here because it may change how you go about things. And I can tell you, it is really difficult to play that game of telephone where the client is talking to agency A that then talks to agency B.

If you’re agency B, you’re not hearing the complete message. You’re not able to convey the complete message back. It slows things down. It can lead to misunderstandings. It can lead to hurt feelings, all sorts of things. So you really, I would encourage you to try to avoid you know, being that hidden white label behind the scenes solution in most cases. Not every case, there’s there are instances where the work you’re doing is delineated enough that it’s fine. But a lot of times, if you don’t have that kind of direct contact with the client, it’s going to make your job a whole lot more difficult, and at a minimum, you need to figure out how to compensate yourself fairly for that, set the right goals and expectations with the agency so that you’re not, nobody is surprised six months down the line.

Gini Dietrich: Yeah, I totally agree with that. And I also think there is some risk in that because, from your perspective, if you are white labeled under the agency and you have direct client contact, I have a client who’s going through this right now, the client might prefer you. Over the agency or some of the people they’re working with at the, the larger agency, and that can create some pretty big issues for you.

It’s nice. It’s a nice ego boost, but it can create some real issues for you with your client, which is the larger agency. And then on the agency side, like if I had a subcontractor or a freelancer that had a better relationship with the client than, than we did, that’s also a problem. So. There, you have to kind of look at all of this and understand, you know, the, the pros and cons, the risks and, and rewards, and it’s a great way to, to build your business for sure, but it doesn’t come without some risk.

Chip Griffin: Yeah, and, and the one thing I’d be really careful of is the hybrid, where you’re half in, you’re half out, you’re sort of half pregnant. Doesn’t work. Don’t do it.

Right. If, if you can’t be in a situation where you’re having direct contact with the end client, but you’re pretending to be part of the agency that’s in the middle.

It gets really, really complicated, really fast to do it that way. If they want you to use, you know, one of the large agency email addresses or something like that, fine, but make sure that you’re, you’re still communicating to everybody that you’re doing this in partnership with them or something. We’re just such close partners.

We have an email address, but don’t try to be in a situation or don’t put yourself in a situation where you are being perceived as an employee of that agency when you’re not. Because that, I guarantee you at some point, there’s going to be a misunderstanding. There’s going to be something where the, the client feels like, well, they, they’ve asked an employee of this agency to do something and it didn’t.

Because your boundaries are different and that needs to be clear to everybody. So to be really, really careful, you can either be fully behind the scenes and only dealing with that agency in the middle, or you can be fully in contact with the client and they know that you are a partner agency or something like that, but that, that, that straddle, that’s, that is where you run the highest risk of problems.

Gini Dietrich: Yeah. And you know, I would think of, I would really think of this through because I think since the pandemic, we’ve been, we’ve, the, the business world has become more accommodating and more, what’s the word I want, like, accepting of contractors, of remote employees, of hybrid relationships, like, they, we’ve all become more accepting of that.

And it used to be that you would have to hire a contractor and white label them and have them work under your umbrella. So if you’re working with a larger agency, you would work under their umbrella. We haven’t, that’s not the case anymore. Like, I don’t think anybody cares anymore. Clients just want the work done and they want to know that it’s being done well.

They don’t care if it’s, you know, with a group of subcontractors or another agency, or, you know, like we don’t have any web experience. So I have a preferred web vendor that we bring into almost every client. They don’t care that it’s not our, agency, they just care that it’s, that’s it’s not our employees.

They just care that their websites are being built and on time and all of that. They don’t have to worry about it. Right. So I think it’s less today needed that you have to white label and more and so you have better, you have more leverage and a better opportunity to say, let’s go in as partners versus us working underneath your umbrella.

Chip Griffin: Yeah, absolutely. I mean, it, it, it’s as you say, nobody really cares, they don’t care where you work, they don’t care who you work for as long as you’re getting the work done for them that they’re paying for. And that is, that is generally speaking the benchmark that, I mean, everybody in or outside the agency world is using today.

And so you should leverage that to your advantage and try to structure it in such a way where you can have the direct transparent contact because that’s in most cases going to work out better for everyone involved.

Gini Dietrich: Absolutely.

Chip Griffin: Now, one thing you had touched on earlier, though, when you do have that is that that does run the risk that the client may like you better.

And so one of the things that you absolutely need to do if you’re subcontracting with another agency is be really clear about what your obligations are. And what your restrictions are on that sort of thing. In other words, typically if, if another agency is subcontracting with you, they ought to be insisting upon language in the contract with you that says that you cannot work for them directly without their pre approval.

And if you were subcontracting, you would want the same sort of protection. So, so I wouldn’t, you know, look askance if, if they’re asking for that sort of protection, but you need to understand what are the rules that are in place. But even once you understand what the, the obligations are. You still need to also understand how is it going to be perceived?

So let’s say you don’t have that kind of restriction in place and the client comes to you and says, we want to work with you directly. Be aware that if you agree to do that, even if you are legally permitted to do it, you’re basically burning that bridge with the other agency.

Gini Dietrich: Absolutely.

Chip Griffin: Do you really want to do that.

I would encourage you in most of those cases, you probably want to talk to the larger agency and say, Hey, look, I got this approach. Can we work something out? Can I pay a referral fee to you or something like that so that we keep you whole? Is there something we can do? But it’s not just the direct relationship with that client, too.

You need to, to understand, is this agency expecting that you’re not going to compete with them anywhere? Again, It may not be in the actual letter of the agreement that you have, but if you go out and you are now, you know, essentially bidding against this agency on another project with another client, it has nothing to do at all with the work that you’re doing with them, they’re probably not going to react positively to that if they find out.

Gini Dietrich: Probably not. Probably not.

Chip Griffin: You, you need to think those things through carefully as well, because they will perceive it very differently than an end client who’s really only going to compare care typically about direct competitors or, or things like that. Whereas the agency, they’re going to care about you touching anything that they either have a client in or that they’re touching on or that they’re bidding on or anything like that.

And so it does create particularly the, the closer the two of you are in the kinds of clients that you’re going after, it can be a problem. And so that’s, that happens more when you have small to mid sized agencies subcontracting. If they’re mid to large, you’re probably fishing in different ponds anyway.

So that’s probably not something that’s as big a deal. But you still need to be aware of it and understand again, what your legal obligations are, but also what the perception might be.

Gini Dietrich: And I think, you know, in the case of my, my clients specifically, they, they do something very different than what the agency does.

So it’s sort of like my web firm relationship, right? And a client has come to them and said to my client and said, Hey, we’d rather not pay you through the agency. We’d rather work with you directly. And my client’s like, Ayeee, which from the client’s perspective is probably the right thing to do because they’re probably going to save money by working with the two agencies.

Maybe. But then they’ll have to manage two agencies. So I think there is some, you know, definitely having the conversation with your direct client, which would be the agency in this case, and say, Hey, they’ve approached me on this. I know we don’t do the same kinds of work. What do you think is the right approach?

And in some cases, the agency owner may be like, Okay, That’s fine with me. That means I don’t have to manage you.

Chip Griffin: And look, I mean, at the end of the day, if there’s going to be an issue, I’d rather it be because I brought it up proactively and we can address it head on. I’m not, when it’s these kinds of relationships, I’m not a fan of ask forgiveness rather than permission.

Gini Dietrich: Yeah. Yeah.

Chip Griffin: And there are times and places where ask forgiveness, not permission.

Gini Dietrich: Yes.

Chip Griffin: When you’re doing subcontract work and you’re threatening that relationship, most of the time, that is not something that I would handle in that way. Particularly if you think there’s the possibility of doing future business with that agency. Because now you’ve not only put at risk your current work, but also potential future work and revenue.

So get it out of the way, come to them proactively, say, here’s, here’s the situation that’s developing. Just want to make sure you’re cool with that. Or at the very start of the relationship, say, Hey, you know, I, I typically do these kinds of projects. I know it may touch a little bit on what you, how do you want to handle those things in the future?

Or just tell them how you plan to handle it, but at least get it addressed up front and don’t wait for the issue to explode in your face. And then you’re like, what do I do now?

Gini Dietrich: Yeah, I think it’s, there are, like I said, there are risks and rewards, there are pros and cons to this kind of relationship. It is definitely how I built my agency.

So I, I am a big fan of doing it that way, if you can find the right relationships. But understand that that is your client, they need, you need to go through the same process that you would if it was a, you know, a typical, I will put in quotes, typical client. But, and understand what the pros and cons are before you go into that relationship.

Chip Griffin: So lots of opportunities to work with other agencies, there’s plenty of upside, but you’d also need to make sure that you’re aware of the potential pitfalls and protect yourself against them.

Gini Dietrich: Absolutely.

Chip Griffin: So with that, that will bring us to an end of this episode of the Agency Leadership Podcast. I’m Chip Griffin.

Gini Dietrich: I’m Gini Dietrich.

Chip Griffin: And it depends.

In this episode, Chip and Gini tackle the challenges of staffing, particularly in response to landing a large contract.

They discuss a Reddit user’s question about managing a $2 million account and emphasize the importance of involving key team members throughout the business development process, rather than afterward.

The hosts advocate for a tiered approach to staffing, employing a mix of high, medium, and low experience levels, and leveraging contractors to manage workload peaks. They also highlight the risks of rapid, large-scale hiring and suggest regular networking and preemptive interviewing to maintain a robust pipeline of candidates.

Key takeaways

• Chip Griffin: “I know it’s appealing, but you’re going to generally be in a better position if you are incrementally growing as opposed to doubling in revenue overnight off of one contract.”
• Gini Dietrich: “We hire contractors pretty consistently. And part of the reason I do that is to figure out if they’d be great full time employees.”
• Chip Griffin: “On these large projects, if you have very senior talent doing very low level work, it really upsets your margins. And frankly, it’s demoralizing to those team members because they probably don’t want to be doing those things.”
• Gini Dietrich: “You’re putting your team way behind by not bringing them through the process. So I would say on both the client and the agency side, it’s a really big disadvantage not to involve your team from the start.”

Related

• Planning for agency growth
• Should your agency hire contractors or employees?

View Transcript

The following is a computer-generated transcript. Please listen to the audio to confirm accuracy.

Chip Griffin: Hello and welcome to another episode of the Agency Leadership Podcast. I’m Chip Griffin.

Gini Dietrich: And I’m Gini Dietrich.

Chip Griffin: And Gini, I think we got to figure out how we’re going to staff this show. I mean, you know, it’s just, I’m really struggling with how we should set it up appropriately.

Gini Dietrich: Sure. We have Jen. She’s awesome.

Chip Griffin: She is.

Gini Dietrich: She needs some help, maybe.

Chip Griffin: Not even going there.

Gini Dietrich: Let’s get her an assistant.

Chip Griffin: Oh, yeah, that, that would really help the economics of this show. Let’s see.

Zero revenue times one minus, no, no, still not a good idea. So, alas, we will be talking about staffing today and how to staff accounts appropriately, but not this account, not this podcast.

Gini Dietrich: No. So I was looking for content topic ideas and I went to Reddit. I would just like to say that I, Gini Dietrich, was on Reddit looking for ideas.

Chip Griffin: Voluntarily.

Gini Dietrich: Voluntarily.

Chip Griffin: You were not under duress. I did not say,

Gini Dietrich: Nobody had to force me.

Chip Griffin: You should go there and look. You did it on your own.

Nope.

Gini Dietrich: I did it all by myself. And I didn’t get scared. And I didn’t get worried, and I actually made it out alive. And I found a couple of good topic ideas. So one that I found was how to properly staff accounts. And this is actually really interesting because the person said they, she, they, I don’t know if it’s a he or she, sorry.

They are an account manager. And they said, too often we sell a contract and then scramble to allocate resources fast enough to meet the client’s expectations. Right, we’ve all experienced this. As an account director, I see this play out first hand with demanding clients and it’s exhausting. Yes. And they say, now we have a new opportunity to generate 2 million in annual revenue with one large company.

Awesome. Leadership has approached me to be the primary relationship manager for this account and while I’m confident I can handle it, it’s only possible with the right team in place. The work includes, and then they list all of the work that’s included, which is a lot. And they’re trying to figure out how to properly staff this, not only to do what’s best for the client, but to sell it into the leadership of the agency to say, I can do this, but this is the team I’m going to need to resource to be able to do it.

And so that is the question, is how do we properly staff for these things? If you win a big contract like this and you don’t have the current team to be able to resource it, what are you going to do? And so that is our topic for today. Thank you, Reddit.

Chip Griffin: Thank you, Reddit. And there is all sorts of things to chew on here.

Yeah. I think I’d like to start with this individual being approached to be the relationship manager, apparently after the business has been won. Right. And so to me, there’s where the agency has made its first mistake because whoever is going to be managing the relationship ought to be, and really must be, involved throughout the business development process.

Because you don’t want to be in a situation, no matter how big your agency is, and I suspect that from what I’m reading here, that this is, you know, not a small agency. At least if you’re taking on a 2 million contract, I would hope that you are not a very small agency, which we’ll, we’ll touch on as well.

So, if you’re going to be the relationship manager, you need to have been involved from the get go. And so my first advice is turn back the clock and make sure that whoever is running the account is involved so that they can understand they can be on the same page with the prospect. The expectations are aligned. But also that individual now has the time to start thinking in advance about how it might be staffed and what resources might be needed.

Because honestly, if you’re only trying to figure this out after the business has been won, it’s a much bigger challenge. And it doesn’t mean that we don’t have those problems, but you need to have at least a notebook sketch of what your plan is before you sign the contract.

Gini Dietrich: Yeah, and I, you know, one of the things that I’ve learned over the years is that when, I always saw it as my job to be the rainmaker and the closer and all that kind of stuff.

So I would go to the meetings and we would have the conversations and we, I would get all of the input, and I would build the relationship. And then I would say, okay, well, so and so is going to be your day to day. Well, a couple of things. Number one, on the client side, they’re expecting me at this point because I’ve been the one through the whole process.

Right. And so then they’re disappointed, or maybe even will say, well, no, we’re not going to do this if it’s not you. So I didn’t have the opportunity to say, this is what it costs to have me. And this is what it costs to have my team that you’ve met. Right. So I can up, price up my services. And then on the agency side, the person that you’re putting in charge or the team that you’re putting in charge is already behind the eight ball because they don’t, they don’t know what you’re doing.

They don’t know what conversations have been had. They don’t know what you’ve promised. I had a boss back in my agency days when I was working for somebody, who was so smart. But we would sit in new business meetings and he would promise the earth, the moon, the stars, rainbows and everything. And I would literally kick him under the table when he would say things because he was promising things we knew we couldn’t, I knew we couldn’t deliver.

Or that we couldn’t do it in the amount of time or for what he was, the cost, right? So, not to say that I do that or that other agency owners do that, but you’re missing the opportunity for your team to go, well, wait a second, what about this? And how do we handle this? And how are we going to resource this?

So you’re get, you’re putting them way behind by not bringing them through the process. So I would say on both sides, it’s a really big disadvantage.

Chip Griffin: Well, you’re putting them way behind and you’re also, it’s one of the reasons why agencies end up pricing incorrectly. Because you haven’t involved the members of your team who are going to be executing on the work.

So you’re sitting there using your own estimates on the amount of time it’s going to take and the amount of people. Yes. And if you start involving your team, who is actually going to be involved early on, they can tell you this is going to take this much time. They can help you with deadlines and say, well, no, that’s not realistic.

And look, you can push back because it’s absolutely true that employees will typically overestimate the amount of time that something’s going to take and overestimate the deadlines to protect themselves, right? That, it’s just, it’s human nature. So, so I’ve got no problem with you pushing back, but it should be an internal dialogue that you’re having with them before the deal is done, before the price is set, so that you can figure those things out and hash out those differences then.

Because that also helps them have buy in to the final solution. And if you are then in a position where you’re coming in, they’ve never heard anything about this client until you meet with them and you say, okay, here’s what we’re doing. Here’s what we’ve promised. Here’s the deadline. They’re going to push back immediately.

So you now have a problem with the client. You’ve got a problem internally. You’re, you’re creating so many problems by not involving people early on in the process.

Gini Dietrich: And when they’re sitting in the meetings with you and going through the process, they’re hearing the same things that you do. So you don’t have to take the time to educate them and digitize your notes and ensure that they’re, they are on the same page, like all of that stuff.

All that stuff happens naturally because they’ve been in the meetings too. So it saves you time and angst and frustration as well by having them in the meetings.

Chip Griffin: And, and I think, you know, one of the things that, I mean, let’s assume that you have involved your team. So we, you know, we’ve now cleared that hurdle and, and unlike in this situation, you’re not actually getting it dumped on you after the contract is signed, you’ve actually been thinking about it, you do need to, particularly on these large projects, you need to be thinking about how you’re going to staff it appropriately.

When you’re very small and you’ve only got one person on an account, you kind of, you, you’re stuck with what you’ve got, but when you start dealing with these larger projects where there are multiple team members, you need to have a blend of high, medium, and low experience levels, cost levels, all that kind of thing.

Because on these large projects, if you have very senior talent doing very low level work, it really upsets your margins. And frankly, it’s demoralizing to those team members because they probably don’t want to be doing those things. That’s not, that’s not what they expect after 10, 20 years of experience or more.

And so you want to be thinking about how do you blend these things correctly and not just throw bodies at it. Not say, well, you know, in order to maintain this level, we always need to have our top people in the room. Cause I’ve been on large client accounts where you put like 15 people in the room for every client meeting. And it can get really, and if you look around the room and you say, Here’s what the cost is of this meeting.

It can blow your mind at times. And so you really need to think about how you’re staffing it appropriately to get the client what they expect, but also doing it within your budget. And you’ve got to keep track of that over time so that you don’t just keep throwing these really senior bodies into a really low level.

Gini Dietrich: Which goes to something that we talk about all the time, which is track your time, so that you know exactly how much it costs. And to your point earlier, as agency owners, we tend to underestimate how much time something will take and how much it will cost. And our team tends to overestimate how much time it will take.

So if you track your time, you, you solve all of those issues. You know exactly how much time it takes. You know exactly how much it costs. You know exactly how much it costs to have all those people in the room. And so I think when we’re saying, you know, don’t just, just dump a new client on a relationship manager or account director, it doesn’t mean you have to have 10 people in the room that are going to service the account, but you do have to have the main point of contact.

You do have to have their day to day contact. So it doesn’t cost you as much to have that person in the room and yourself in the room as it would to have eight or 10 people in the room. So think about it from those perspectives as well.

Chip Griffin: Right. And I, I think whoever you are designating as that day to day manager, you have to empower them.

Yes. And so you need to be, you need to, you know, give them some general bounds and you need to talk with them about what the budget for the project is, but you need to rely on them to tell you what resources they need. Absolutely have a discussion around it and make sure that you’re on board with it, but you can’t be in a position where you’re telling them exactly what they’re going to get and how it’s going to be done.

Because that makes it harder for them to do their jobs. And frankly, it makes them less likely to go along with the decisions because they’ll feel like it’s just being dictated to them from above. You really want to have that kind of collaborative work with your team members and really let them feel like they have a say in what’s going to happen with their own day to day.

Gini Dietrich: Which I think in this, this Reddit example is a good example of that. So first they, it sounds like they didn’t do the right thing in inviting this person to the pitch and going through that process, but they have done the right thing in letting this person dictate this is what we need. These are the resources.

This is the team I’m going to to build. Now whether or not they said to this person, tell us what you need, or this person is just saying, I’m gonna go meet with them and this is what we’re what I’m gonna do. That’s it. I don’t know. But this person is at least taking the step to say, okay, I’m gonna think this through.

If I’m gonna be this, the relationship manager on this huge account. Here are the things I think I need, and going to leadership to sell that in.

Chip Griffin: Well, and that’s a good indicator that this individual may be actually well positioned to do this kind of work because whether they’ve been asked to or not, they’re thinking about these questions and, and, you know, these issues that need to be tackled.

And so if you’re in a position where you’re being asked to do these things, maybe you’re an employee listening to us. Or maybe you’re just, you’re the agency owner, but you’re thinking about the project work that you’re doing on behalf of a client. Coming to the table with clear questions and clear ideas is really helpful in demonstrating that you’re ready for the task ahead of you.

And it also helps you to make sure that you are more likely to succeed because you’re not going into that just, you know, kind of wandering around aimless saying, Oh my God, what’s going to happen next? I mean, Reddit may or may not be the best place to come and get this advice, but at least they’re looking for advice from somewhere.

Gini Dietrich: Right. Although I will say some of the advice they got is actually not bad. You know, sometimes we read these and we’re like, Oh no! But some, some of the advice that they got was, is not too, too bad. In fact, some, one person even said, so here’s what you should think about if leadership pushes back. Because, you know, as agency leaders, we may say, Oh, you, we need, you say you need to hire 10 people to resource this.

Good luck, Friend. So the person, I think, has to be prepared for that. And as an agency leader, you have to be, be prepared to listen and to understand, you know, honestly, truly, if, if somebody came to you and said, we’re going to need eight to 10 people to, to service this account for 2 million bucks, that’s probably accurate.

But are you prepared to hire eight to 10 more people and onboard them quickly? And right. So there, I think you have to think about those things too. Do you have a pipeline full of candidates that you could rely on? Do you have a bench full of contractors that you could rely on? Like, those are things that you have to think about as you grow your business, no matter what.

You know, I think one of the things my husband does really, really well is he’s constantly interviewing people. Constantly. And, and he’s really honest with them to say, hey, we don’t have a position right now, but I like to keep my pipeline full of really smart candidates. And he does this, I bet he interviews five to ten people a week.

And he’s just constantly, you know, and then he’ll say, okay, this person would be great for this. I don’t, we didn’t really like that person, but he like has a pipeline full of candidates. That when something happens big, they’re ready to go. And I think that’s a really good lesson for all of us. You don’t have to interview just when you’re hiring.

You can, you know, find contractors that you have on the bench that you can pull in when you need something. You can find candidates who… and you may lose out on them because they found another job, but you still have built that relationship and started to say, okay, these are the types of strengths and weaknesses that I’m looking for.

And this person fit that really well. So keep those pipelines full, both contractors and potential employees, because that’s going to help you in situations like this as well.

Chip Griffin: Yeah. I mean, that’s, it’s helpful if you, if you’re at a size that you’re happy with and you’re not really looking to grow dramatically, you’re just looking to, to try to keep it, you know, stable.

Yep. But it’s even more important if you are looking to grow. You absolutely have to be in there and, and trying to find these candidates for potential jobs that you don’t have yet. One thing I will say in this particular case is, you know, when, when you’re looking at a 2 million contract, that’s very different depending on what your current size is.

So if it’s a 2 million contract and you’re a three to 5 million agency versus a 2 million contract and you’re a 200 million agency. And obviously we don’t have that information from this particular question, but if it is something where it is the largest contract your agency has ever had, or it is substantially larger than anything you currently have, first of all, you need to be very careful about taking on that kind of business because it looks really attractive.

It can be really exciting, but if you don’t have the experience in managing it, and if it’s going to cause you to have to do a lot of hiring all at once, that can be a real problem and you can damage your reputation by taking on business that looks really good because of all the commas in it. But it’s, it’s not very good at the end of the day because you’re not able to deliver on the expectations that the client has.

So make sure that you’re right sizing those things. And if it is a big lift for you, make sure in that case that you have a much clearer plan about how you’re going to get things done. And it’s probably a tiered plan. It’s probably, I’m going to use contractors in the short term. They’ll help with X, Y, and Z, and that’ll kind of get us over the first 90 days.

And then we can start bringing people on from that point. Because you’re not going to be able to, I mean, even if you’ve got a good pipeline, you’re not bringing people on tomorrow. You know, if employees take, even if you’ve got a great pipeline, like your husband does that, that hire is, is almost certainly not going to be able to start work tomorrow.

And so you, you need to have that kind of a lead time. And even if they could start tomorrow, you’re not going to throw them or you shouldn’t throw them right into, you know, your largest client account right off the bat.

Gini Dietrich: No, absolutely not.

Chip Griffin: You need to have an opportunity to work with them and get them up to speed and acclimated and all that kind of thing.

So you’re talking at a minimum weeks and more likely months before someone is really a contributor to a project. And so you need to be thinking about those things. And triaging as best you can the work that needs to be done today versus what you can accomplish three months from now.

Gini Dietrich: Yeah, I really like that tiered approach because I think you can think about it instead of saying, okay, well, it’s a 2 million account.

I’m going to divide that by 12, and we’re going to do that amount of work every month. Like, you don’t have to think about it that way. A few weeks ago, we talked about VIP breakout sessions where you might charge, let’s say you charge 30, 000 for something like that. So you do that piece of it first and get that income in the door, but you can do it with your existing team.

And then you, that gives you, you know, 30 or 45 days to find the right people because now you’re building the actual plan. You know, what kind of skillsets you’re going to need, what kind of skillset you have already. that you can bring in and you, you can, it gives you time to sort of move things around and figure out.

So I really like the tiered plan approach of you saying, okay, here’s phase one and this is what the deliverable is. Phase two is this, phase three is this and so on so that you can start to build the team appropriately and onboard appropriately so that you have the time to get the, your new people to the point that they can go on to your largest account.

Chip Griffin: And I think you always want to be careful about rapid hiring of a large number of people. And the smaller you are, the smaller that number needs to be in order to define it as large.

Gini Dietrich: Sounds terrible.

Chip Griffin: In general. I don’t like you hiring more than one person at a time.

Gini Dietrich: At a time, right.

Chip Griffin: Because as, as I always say, as soon as you add that new person, it changes the dynamic of the entire team.

Yep. And so if you’re in a position where you’re bringing on two or three new people at once, or six or seven or eight people all at once. Then you, you’ve got a weird dynamic here, the odds of success for all of them goes down. You almost certainly will have some real flame outs in that group just because they don’t mesh with each other or you staffed wrong. Because I mean, look, we’re hiring people off of, you know, what, maybe two hours worth of conversations and a little bit of email.

We’re not hiring off of absolute knowledge over how they work with people, what their real skill set is. How long does it take them to execute on tasks? And so you could end up easily where you’re in a position where you’re, you’re overstaffed in one area and understaffed in another, because you guessed wrong about what their, their ability to bring talent to the table would be.

You don’t want to be there. You want to do this at a reasonable, rational pace, which again, is an argument for not trying to get these contracts that are wildly disproportionate to your current size. I know it’s appealing, but you’re going to generally be in a better position if you are incrementally growing as opposed to doubling in revenue overnight off of one contract.

Gini Dietrich: And one of the things I really like to do at that point is we hire contractors pretty consistently. And part of the reason I do that is to figure out if they’d be great full time employees. So, you know, we may hire somebody because we need expertise in content development. And I’ll bring in three or four freelancers to do that work just to see what their strengths are, how they work, how they communicate, whether or not they get along with the rest of the team.

It’s a good sort of runway for me to understand is this person, would this person be a great full time hire or not? And in some cases the answer is no. Some cases they’re going to be a great freelancer forever. And in some cases it’s like, yeah, let’s snap, snap this person up as fast as we can because they’re a great fit.

They’re a great culture fit. They do all the things that we need them to do without having to train them and let’s, let’s snatch them up as, as fast as we can. In some cases, they may want to continue freelancing. And so that’s a different conversation, right? But I do like to keep my contractor base full from, from that perspective, because you can try people out and say, okay, does this fit our culture?

Does this fit our team? And it doesn’t cost you the same as it would if they, if you hire them and they don’t work out.

Chip Griffin: I think that’s a great way to end this episode. We’ve solved all of your staffing problems, our staffing problems. It’s also

Gini Dietrich: I still have stabbing problems, but

Chip Griffin: Well, we’re not going to solve that on this episode, so maybe next episode, who knows?

Gini Dietrich: Who knows?

Chip Griffin: With that, that will draw to an end this episode of the Agency Leadership Podcast.

I’m Chip Griffin.

Gini Dietrich: I’m Gini Dietrich.

Chip Griffin: And it depends.

In this episode, Chip and Gini discuss the findings from the SAGA quarterly survey of small agency owners. They cover insights on optimism in business outlook despite recent challenges, with a focus on talent-related issues such as compensation, retention, and recruiting.

They delve into some surprising statistics, such as one in five agency owners not paying themselves regularly and over 30% having reduced headcount in the past year.

The conversation highlights the importance of agency owners paying themselves a fair salary, balancing employee compensation, and maintaining efficient business practices without overworking staff.

They also discuss the significance of flexible work arrangements and employee benefits in improving retention.

Key takeaways

• Chip Griffin: “I think just about every agency owner out there could go and get a six figure job. So why are you taking on all the risk and stress if you’re not compensating yourself for that risk and stress?”
• Gini Dietrich: “You should be paying yourself a living wage. And an employee should not be making more money than you do.”
• Chip Griffin: “Working overtime should be because something legitimately came up that was out of the ordinary, an emergency of some kind. It shouldn’t be the only way we can do this work profitably.”
• Gini Dietrich: “Reducing your pay as an owner while giving raises to your team is hurting you. It’s hurting your business. It’s hurting any ability to be able to sell in the next three to five years.”

Resources

• SAGA’s Q4 Small Agency Owner Survey finds continued optimism, reveals talent trends
• Richard Dawson on Family Feud “Survey says”

Related

• An honest conversation about agency owner compensation
• Ways you can compensate yourself as an agency owner
• The difference between agency owner compensation and profits
• When owners do work below their pay grade

View Transcript

The following is a computer-generated transcript. Please listen to the audio to confirm accuracy.

Chip Griffin: Hello and welcome to another episode of the Agency Leadership Podcast. I’m Chip Griffin.

Gini Dietrich: And I’m Gini Dietrich.

Chip Griffin: And Gini, as they say on Family Feud, survey says.

Gini Dietrich: Is that show still on? I think it is.

Chip Griffin: I believe it is. I believe it is because I see little reels that pop up in my Facebook and Instagram occasionally with funny moments, from it.

Gini Dietrich: Survey says.

Chip Griffin: Survey says. I don’t, I don’t know that they say survey says anymore, but.

Gini Dietrich: We just showed our age.

Chip Griffin: Yes. Okay. It is what it is. I mean, there’s probably been three or four hosts since.

Gini Dietrich: Yeah, I think so. Yeah.

Chip Griffin: I don’t remember who that was, who did that, but anyway, very distinctive. In any case, we will stop making ourselves look and sound old.

And instead we will talk about the SAGA quarterly survey, because once again, we have talked with small agency owners to see what they’re thinking and what their outlook is for the next 12 months. And on top of that, we took a deep dive on talent questions. So compensation, retention, recruiting, those kinds of things, so that we have a little bit of an understanding of, of how they’re approaching the, the labor side of the equation in their businesses.

Because the more we learn about each other, the more useful that we can be, or the more productive we can be.

Gini Dietrich: And it’s super interesting. There’s a couple of things in here that are a little bit mind blowing that I think we need to talk about.

Chip Griffin: Yes, there are certainly some things in here. I mean, the overall outlook seems to be positive, although once again, very similar numbers to what we saw in Q3 in terms of overall satisfaction with their business and anticipation of revenue and profit increases in the coming 12 months.

Just as it was in Q3, I’m not entirely sure of why there is this optimism and this satisfaction.

It is certainly something that, I mean, look, there’s, I think there are potentially good things on the horizon. So there is, I’m not saying it’s an irrational optimism. At the same time, I suspect, and as we dig into some of these, the talent questions, we’ll see, that a lot of agencies cut back their head count over the last 12 months.

So in part, some of the optimism might be, we can’t get any worse, right? So it’s got to be better. It’s got to improve. And so that may be driving some of that optimism. But the overall satisfaction, the score was 6. 94 out of a, on a 10 point scale. So that’s, that’s not terrible. I mean, it’s not, it’s not overall excited, satisfaction with their businesses, but it’s not dissatisfaction either.

Gini Dietrich: But as you also point out that about 20 percent rate their satisfaction at five or below, which is some real concerns. But I thought it was really interesting because, only 1 percent expected to reduce their team size, which is a drop from 11 percent in quarter three. So that’s, that’s a good indication that maybe things are starting to stabilize a little bit.

Chip Griffin: Yeah, I think, I think from a, from that perspective, I think that’s probably the, the, the best piece of data, that we saw there was that there was, there was no longer, because what we, what we commented on in Q3 was, you know, there’s optimism that, that revenue and profits are going to increase, but people are talking about holding steady on their headcount or even reducing.

And so, you know, that sort of, that was concerning because that suggests that they’re going to try to balance the books on the backs of the employees. The fact that, that there’s no longer an inclination to reduce at least, I mean, we’re not seeing people, you know, saying we expect to increase either, but the fact that they’ve moved off of decreasing headcount is certainly a good sign, I think, and something worth noting.

Gini Dietrich: Yeah, I totally agree. It, it is, there is some optimism. It is tempered by the fact that, while we’re not, we’re not going to reduce our staff size, we’re not necessarily going to increase it either. So there’s some optimism to increase revenue and profits a little bit. There’s some optimism in terms of not having to let people go, but there’s also, it’s tempered, I think, a little bit by saying, yeah, but we’re probably not going to be adding people either.

Chip Griffin: But I think the really interesting stuff comes when we start digging into some of these talent questions. Yes. And so, and, and, and the talent by the way, includes the owner. So we’ve got some things about owner comp that we, that we need to talk about here as, as well. But you know, one of the things that I think feeds into what we were talking about as far as the overall outlook is that one in three of small agencies have reduced their headcount in the past 12 months.

So. You know, when you, when you start to see they, you know, they’ve already been cutting numbers in substantial percentages, that suggests one of the potential reasons why they may not plan on reducing any further. And so, you know, that they may have weeded out the issues that, that they had from a cost perspective.

Maybe they’re improving their, their profit numbers, and so that’s, that’s causing them to feel like they’re in a better position. For the year ahead. So certainly it’s, it’s been a tough 12 months. There’s, there’s no doubt about it and longer than that really, but the, the survey looks particularly at the last 12 months.

And as, as we look at that, that I think informs some of what’s, what else is going on that’s even more troubling, particularly when we look at, at owner comp. Because one in five small agency owners doesn’t pay themselves regularly at all. They just take money out of profits as and when they can. And, what is it I think about, 39 percent, are, are paying themselves under a hundred thousand dollars a year.

Gini Dietrich: 39 percent are paying themselves less than a hundred grand. That’s not okay.

Chip Griffin: No, in, in fact, more agencies, I, I think I’m correct in saying this, or saying it correctly, more than half of agencies have at least one employee who’s making over a hundred thousand. Nope. Less than half pay themselves over a hundred thousand on a consistent basis.

Now that doesn’t mean that they may not be harvesting that out of profits, you know, by doing a big dump here or there, but you’ve got to be paying yourself consistently. And, and really, I think just about every agency owner out there could go and get a six figure job.

Gini Dietrich: Yeah.

Chip Griffin: I won’t say easily, but without a huge amount of difficulty.

And so why are you taking on all the risk and stress if you’re not compensating yourself for that risk and stress?

Gini Dietrich: Why, exactly, like, why are you doing this? I say this to, to my clients all the time. If you were to go get a job with your level of expertise, your number of years of experience, and what you, your skill that you offer to an organization, how much money do you think you could command?

And there’s usually some hemming and hawing, and I really push this, like, really and truly. What do you think? And if they can’t give me an answer, I do a screen share and we pull up job descriptions and we look to see if you took this job, here’s the range. And it’s always six figures, always. And the person’s paying themselves like 50 grand a year or 45 grand a year.

Why are you doing this? Because you have all the risk. You have, you’re putting everything into it. You should be paying yourself a living wage. And an employee should not be making more money than you do. Now, is it honorable that you want to make sure that your employees are paid? Absolutely. But they should not be making more money than you make.

So you’ve got to figure that piece out. You have to.

Chip Griffin: Yeah, because look, even, even if you’re doing it because you’re like, Well, I got a talented team. I need to keep them around. It’s tough times and all of that. The reality is that if you’re not making measurably more than your highest paid employee, you will end up resenting them.

It may not be in those first three months. But over time, you will come to realize, it’s human nature, you can’t sit there and think, I own this business, I’m, I’m, you know, I’m struggling to meet payroll, and yet I’m paying you more than I’m paying myself. It is not a healthy place to be, you’re unlikely to make good business decisions when you’re in that position.

And particularly because, the owners in the survey, they’re, they’re not paying themselves well, and, and about 40 percent of them are paying themselves less now than they did a year ago.

Gini Dietrich: No.

Chip Griffin: So, so, so they’re not paying themselves enough to begin with, they’re cutting their pay and yet most of them are reporting that they gave raises comparable to what they’ve been giving in the past to their teams.

Again, admirable. I, you know, I, I love that you feel that way about your teams and you’re trying to be helpful to them, but, but ultimately that’s not a healthy business choice. Because it’s not like you’re making 10 million a year and you took a pay cut to 8 million, right? Right. I mean, if you’re the CEO of a giant company and you take that kind of pay cut to, you know, to be symbolic or whatever, fine.

Gini Dietrich: Right.

Chip Griffin: But, but when you’re making 80, 000 and you start paying yourself 60, 000 because that’s how you can come up with the money to give raises or bonuses or to keep an employee around, that’s not healthy.

Gini Dietrich: No.

Chip Griffin: And so you really need to be thinking about these things as you go into the next 12 months and thinking about, how do I make sure I’m paying myself a fair salary for the work that I’m doing. And remember, we always talk about this. You need to have two revenue streams from your business personally. One is your compensation for the work you’re doing because you are an employee of the business. And you also need to have a profit stream separate and apart from that.

And that’s for your risk taking as an entrepreneur. And if you don’t have those two revenue streams, you’re not building a healthy business and you’re not ultimately building something that I think you will be satisfied with five or ten years down the road.

Gini Dietrich: And you aren’t building something that if your goal is to sell it eventually, you won’t be able to because it won’t be there.

The numbers won’t be accurate and you won’t have been paying yourself. And so there’s all of those things that go into it as well. So you, I, I love the idea of thinking about it from the perspective of a salary as an employee and then profit as the risk taker. And so the salary as an employee is a non negotiable, just like it’s a non negotiable for any other employee that you have.

The profit sharing. Now that, that piece is, you know, up to you, whether or not you’re, you’re bidding projects or retainers appropriately, whether or not you’re actually making a profit. All of those things come, come into play. So you can start to work on, gosh, I’d really like to have more profits come into my bank account.

Then you can start working on the things that you need to, to increase that. But the salary is a non negotiable. You have to pay yourself at least what you would be able to make somewhere else.

Chip Griffin: Right. And, and

Gini Dietrich: Or that if you had somebody come to you and buy, to buy the company, they would say, are you making enough money?

Like if we replaced you, how much would we have to pay a CEO of this business to replace you? That’s what you should be paying yourself.

Chip Griffin: And that’s one of the big, the big gotchas that a lot of agency owners have when they start thinking about selling the business and something that, that is always tough to explain to an owner, particularly if they’re in the position of, I want to sell now.

And they haven’t been thinking about this because, you know, they think that they’ve got, you know, 200, 000 in profit because that’s what they put in their own pocket. And the reality is that no acquirer is going to look at it that way. They’re going to assign part of that 200, 000 to salary and part of that to profit.

And all of a sudden your profit is now in the toilet. And so what you thought you were worth, you are not. And before anybody starts emailing and commenting and ranting, well, my accountant told me not to pay myself a salary for tax purposes, not talking about that. When I say salary, it’s just fixed compensation.

However, your accountant tells you to do that. It could be a, you know, a guaranteed income. It could be salary. It could be just regular draws that you take on clockwork and, and you’ve got allocated on paper and in your mind as compensation for the work you do versus profits. I don’t care how you do it.

Absolutely do it in the most tax efficient way possible, and that will be different based on how your business is structured and where you’re located. Even two very similarly structured agencies in two different states, they have to pay it differently, right? You can be an S corp in one state and an S corp in another state, and your accountants will tell you that you need to either pay yourself a generous salary or not.

Yep. Whatever. Do what they tell you to do. Yep. But you still need to have in your mind and on paper a proper salary for the work that you’re doing, however you account for it.

Gini Dietrich: I, like I said, it’s a non negotiable and it’s, it’s shocking that one in five in the survey, one in five don’t pay themselves a regular salary opting to instead to draw from profits.

Okay. If you don’t have profit, then that means you make zero, which sucks. Among those who do pay themselves fewer than half reported earning six figure salaries and 39 percent acknowledged reducing their pay over the past year. The, the thing about it is that they’ve, to your point, it’s admirable because they’ve reflected a commitment to rewarding their teams, but it’s in, it’s, it’s hurting you.

It’s hurting you. It’s hurting your business. It’s hurting your future ability to be able to do the right things. It’s hurting any ability to be able to sell in the next three to five years. If that’s a goal, like you have to really think about these things. And it’s not just In the here and now, it’s, and listen, it’s been a crappy year.

It’s been a crappy two years. I get it, but you have to figure out how you can, how you can pay yourself first and then build your business around that.

Chip Griffin: Right. And I, I think there’s, there’s other data in the survey that, that points to small agencies perhaps not structuring themselves appropriately. Either because they’re not pricing correctly, they don’t, they don’t have efficient processes in place, those sorts of things.

Because you know, when we look at the data, one out of three small agencies are having their employees work overtime at least monthly. And so if, if at least one out of every four weeks your team is being asked to work overtime, that’s a problem. So that really suggests that you have a problem in terms of how you’re resourcing for the work that you’re doing. Which usually is because you’re not pricing it enough.

And so you have to find a way to squeeze out as much labor as you can. And, and at first blush, you sit there and say, well, it’s, it’s, it’s only once a month, right? And that doesn’t sound like that much, but that’s 25 percent of the time, right? Just four weeks in most months. And if at least one out of four, they’re working more than 40 hours a week, typically.

That’s a problem. And, and you know, I, I know that most of us grew up in a world where we worked more than 40 hours a week every week . When I started out in agency world that’s, that’s what everybody did. Sure. And that’s why agencies have such a bad reputation. Yes. And you, you can’t build your business expecting that that’s going to be the way that you do things.

It doesn’t mean that it won’t happen from time to time. Like, I’m not saying that you should never have employees work more than 40 hours a week. Right. There’s always, but it ought to be rare. It shouldn’t be part of your usual regular practice. Because that makes it harder to retain your employees, particularly today. Particularly where people are valuing, you know, work life balance much more and and they’ve seen the way things can be and they want it that way.

And we can sit here and say, well, that’s not the way we did it. We don’t, we don’t think it’s right. You, you know, you just need to buckle down and do it and pay your dues and all. You can say that all you want. Good luck in, in being able to staff consistently at a high level if that’s your approach.

Gini Dietrich: Yeah.

And I will say, I will tell you that the younger generation, Gen Z, will not have it. They’re like, yeah, no, I’m not doing it. So figure it out because this is not the way of the world anymore. And yes, you and I are of the generation that we did, and 100 hour work weeks were not uncommon, but that, that’s not how things work anymore.

And the fact that if you think that you’re going to build a business, to use a phrase that you use all the time, on the backs of your employees, you’ve got another think coming. You’ve got to figure this out because that’s, that’s not anybody that’s younger than, that’s probably 35 or younger is not going to work that way.

Chip Griffin: Yeah, I mean, working overtime should be because something legitimately came up that was out of the ordinary, an emergency of some kind. It shouldn’t be that’s the only way we can do this work profitably or even minimally profitably. You’ve got to be thinking about those kinds of things. And we see that, I mean, the small agencies in the survey.

Every single one of them is either remote or hybrid. There wasn’t a single respondent that said that they had gone to, to fully in office work again. And, and so that it surprised me a little bit that, that not one was an all in office agency. Cause, cause they are out there. There aren’t very many anymore, but, but they are out there and we are certainly seeing bigger businesses who are trying to force their employees back into the office, usually with a lot of resistance.

But the, the fact that employees are now mostly remote entirely or hybrid and, and the survey also showed that you’re also giving them a lot of flexibility to define what their hours are, when they come into the office and when they don’t. Most agencies are not saying this is our set schedule in the office or out of the office.

Even when you’re remote, not saying it’s got to be exactly nine to five so that you’re aligned with the rest of the team. Most are giving flexibility. And that’s great, but just because you’re giving that flexibility doesn’t mean that you can also say, Oh, and by the way, you’ve also got to work 45, 50 hours a week on a regular basis.

So be consistent in trusting your employees, be consistent in finding ways to help them. And frankly, with most agencies giving raises and, and, and doing them at, at or near previous levels. Frankly, a lot of employees would be maybe not just as happy, but they would be very happy if they were not being asked to work overtime.

Right. Yep. Well, we, we consistently hear from employees that they’re more interested in that work life balance than they are in how much is going into their bank account every two weeks. Doesn’t mean they don’t care about it, but if you ask them to rate the relative significance, oftentimes it’s the amount of time spent and

 not the actual compensation.

Gini Dietrich: Absolutely. That and the flexibility. Giving them flexibility. Like, don’t say they have to be sitting at their desk for 10 hours a day and, and making sure that they are. Like, giving them the flexibility to be able to go to the doctor’s, a doctor’s appointment in the middle of the day or running to the DMV to renew their driver’s license, whatever it happens to be.

But that, I think those two things are really, really important. And so if you’re thinking about how do I make sure that I’m going to have a consistent paycheck for myself, or how am I going to give raises and bonuses? Perhaps the quote unquote raise or bonus is not monetary, it’s not financial, but it’s in more flexibility or the ability to do things that they’re not able to do right now.

I mean, there are lots of things that we do for, for my team that, you know, we don’t necessarily pay for. We close the last two weeks of the year, every year. Nobody has to take their PTO for that. And, people love that. They love that. We have the whole week of Thanksgiving closed. We’re closed. They love that.

They don’t have to take their PTO. You know how much money that cost me? Nothing. Nothing. And people are willing to give up a bonus, a year end bonus, because they get three extra weeks off. So there are things that you can do to ensure that you’re getting yourself paid and being able to keep your employees happy too.

Chip Griffin: Yeah, and, and I think if you take a look at, at some of the other, data in the survey there, there’s also, I mean, we’ve only really skimmed the surface of, of what it covers, when it comes to talent, but I, I think if you start looking into it, there are a lot of things that you can do in terms of, of, helping your employees with, benefits, helping your employees, with, improving their skill sets. A lot of things that you can do that don’t cost necessarily a lot of money. Even things like, you know, the, the survey showed that, that only about 80 percent of, of agencies with full time employees are providing health insurance as a benefit. That was a little surprising to me that it wasn’t higher, and I get that health insurance is expensive, but, but you can provide health insurance even if you’re not subsidizing it at all.

Yep. And I, and I would encourage you to, at a minimum, make it available to your employees if you can. Even if you’re not offering even if they have to pay 100 percent of it, because it’s a way to access something that is different from what they can get in the public exchanges, which, depending on where someone lives, may have some good choices, may not.

And so, you know, I think that there are creative ways that you can go about these things, even when you’re afraid of the cost of things, to do them creatively in such a way that it helps your team. And, and all of those things will help with retention and if you dig into the data, it shows what percentage of employees are leaving to go to agencies versus other places, who’s going to work for clients, you know, what percentage of agencies have had to do layoffs or have had to terminate employees for cause, all sorts of stuff in there that I think will help you to gain some additional perspective on your own teams and your own policies and practices.

Gini Dietrich: Yeah, for sure. I mean, it’s, I think the one non negotiable is you have to pay yourself a salary, and the rest of it is there to help you figure out what you should be thinking about for next year, especially the first quarter. And it does seem like things are starting to stabilize a little bit, so that is good news, but approach it with some cautious optimism.

Chip Griffin: Yeah, it will be interesting to see how the first quarter of next year develops and, and where things go from there because in the first quarter we’ll be looking back at, at overall performance of the agency in the past calendar year and, and look at some bigger trends like that. Really looking forward to that as well. But, I would encourage you to, to download a copy of the results.

They’re available for free at smallagencygrowth.com and, you can dig into them and see what you might find in there that would be useful to your own business and, and give you some ideas for what you might do with your own teams.

Gini Dietrich: Absolutely. Go study it.

Chip Griffin: So with that, that will draw to a close this episode of the Agency Leadership Podcast.

I’m Chip Griffin.

Gini Dietrich: I’m Gini Dietrich.

Chip Griffin: And it depends.

In this episode, Chip and Gini delve into the importance of empathy in agency management. They emphasize the need for agency owners to put themselves in the shoes of clients, prospects, and employees to improve communication and relationships.

Key points discussed include handling difficult client conversations, managing scope creep, billing practices that avoid perceptions of nickel-and-diming, and providing constructive feedback to employees without micromanaging.

They also advocate for regular, honest communications with clients and creative solutions to financial challenges faced by both agencies and their clients.

Key takeaways

• Gini Dietrich: “It’s putting yourself in the shoes of the other person, and it’s ensuring that you understand your financials and how to make a profit and how to scope and you’re tracking your time so you know how much things cost.”
• Chip Griffin: “The pressure on agencies is immense right now. There’s a lot of financial challenges that all agencies are facing. At the same time, we need to remember that most of our prospects and clients are feeling those same challenges.”
• Gini Dietrich: “It’s leadership. And that’s what you should be aiming toward. Not management, but leading. Not managing, not micromanaging, not telling them unintentionally that you don’t trust them, but leading them the way that you want them to go.”
• Chip Griffin: “You need to find ways to understand what the client needs and is looking for and how you can solve it rather than simply saying no.”

Related

• How to make conversations with your agency employees less difficult (featuring Allyns Melendez)
• Building trust and letting your team shine
• Raising Prices for Your Agency’s Clients

View Transcript

The following is a computer-generated transcript. Please listen to the audio to confirm accuracy.

Chip Griffin: Hello, and welcome to another episode of the Agency Leadership Podcast. I’m Chip Griffin.

Gini Dietrich: And I’m Gini Dietrich.

Chip Griffin: And Gini, I’d like to put on a pair of your shoes today.

Gini Dietrich: I don’t think they will fit.

Chip Griffin: I think it’s incredibly unlikely, that they will fit.

Gini Dietrich: They don’t even fit my kid.

Chip Griffin: I confess when we’ve met in person, I haven’t really looked at your feet that closely, but just based on our relative statures, I would be shocked if my feet fit into your shoes.

Gini Dietrich: Yeah, I don’t think they’ll fit.

Chip Griffin: No, no. I think that would, I’m not sure it’s my style either, really.

Gini Dietrich: Probably not. Probably not.

Chip Griffin: I’m such a fashionista. Yeah.

Gini Dietrich: Yeah. I mean, right now I’m wearing my UGG slippers. It’s so, but look at how small they are. That’s a size five. They’re not going to fit you.

Chip Griffin: Definitely not.

Definitely not. Well. We veered off the rails even before we started. You’re showing footwear to the audience. So, that was not where I thought this was going.

Gini Dietrich: Would you like to see my oranges and apples? Would you like to see my, I’m growing oranges and apples in my corner. Would you like to see that?

Chip Griffin: You’re, you’re growing citrus fruits in Chicago in the winter.

Gini Dietrich: Correct.

Chip Griffin: Makes total sense.

Gini Dietrich: Quite, quite pleased with myself.

Chip Griffin: I’m, I don’t even know what to say about that, so. It’s,

Gini Dietrich: it’s impressive.

Chip Griffin: How about we move on to the actual topic today. Before we really.

Gini Dietrich: Alright, fine. Fine, fine.

Chip Griffin: Crash into the ravine and end this show. So we are going to talk about shoes, but not in the way that we’ve done so far.

We’re going to talk about the importance of, as you’re an agency owner, putting yourself in the shoes of the other party in all of the conversations and activities that you’re engaged in. So putting yourself in the shoes of the client when you’re having a difficult conversation with them, or when you’re thinking about asking for something, putting yourself in the shoes of the prospect, as they look at what you’re proposing. Putting yourself in the shoes of your employees, as you’re offering them feedback or making decisions about different things.

And so I think all too often as owners, we hear this advice from folks like us, who tell you, you need to maximize profits. You need to manage scope creep. You need to make sure that you’re getting results for your clients and you need to press your team for them. You need to make sure that you’re telling your team what you need and what you expect and all of that, but we’re often leaving out the part of thinking about how does the other party perceive it?

What are they hearing when we’re saying these things? And I think that’s a really important thing to consider so that you can actually make sure that you’re getting what you need, but you’re also understanding what the other party needs that you can reach something that works for both of you.

Gini Dietrich: Yeah. I mean, it’s, it’s just like any other relationship, right?

You have to put yourself in the other person’s shoes in all your other relationships or your marriage, your friendships, all of those. So I think even with your kids, I think it’s really important to remember that. And you’re right. There are. Tend to be some challenging conversations we have to have sometimes with clients partly because we’re not doing the things that we should be to scope correctly and manage profitability and ensure that we’re doing the things that we need to, to make sure that we are making money.

And because we’re not doing that up on the upfront side, it makes it more challenging on the back end to have to have those conversations. So I think it’s, it’s a combination of both. It’s for sure putting yourself in the shoes of the other person, and it’s ensuring that you understand your financials and you understand how to make a profit and you understand how to scope and you’re tracking your time so you know how much things cost.

It’s a combination of all of those things.

Chip Griffin: And look, I mean, we know that the, the pressure on agencies is immense right now. There’s a lot of financial challenges that all agencies are facing. At the same time, we need to remember that most of our prospects and clients are feeling those same challenges.

Right. And it’s one of the reasons why we are in the agency community. But we need to think about those things, particularly because we’ve talked, we talk all the time about the need to raise prices, for example, as an agency and how if an agency owner starts to ask us a question, if they, if they’re charging enough, the default answer is no before we even hear any facts, because that’s just how it is.

At the same time, if you go to your, you know, and we know that inflation is hitting you right now as an agency. If you go to your clients and say, you know, we need 10 percent more next year for the same level of work, that may be correct for us and making sure that we’re balancing our books, but we need to think about how the client is hearing that. And what the client is hearing is, I have to find a way to come up with more money to pay you as an agency, even though my own budget hasn’t increased and is probably shrinking also.

And so, so now I have to give you a, an even larger piece of the pie just to keep going with what we’re doing. It doesn’t mean that you shouldn’t be raising prices, but you need to be sensitive to the way that they’re looking at it and figure out how you can come up with messaging to help sell what you’re doing, but also are there other alternatives you can come up with?

Can you reduce your scope while keeping the fee the same so that you’re not taking a bigger piece of the pie or at least not any bigger?

Gini Dietrich: Yeah, I think, I think that’s exactly right is finding creative ways to work around it, because we actually have an agency client that in September wanted to send an email saying they were raising prices and the email they wrote was interesting.

And I was like, um, I don’t think you should send this email. Let’s maybe think about other ways to, to handle this. Because they’re in, they’re in a commodities, commodity business. And so they do need to raise prices and it happens across the industry. So it wouldn’t be a big surprise, but it’s in the messaging and how they were delivering it.

And I think that’s the same, same thing we have to think about is, you know, are there things that we can do? And I, I personally love the idea of reducing the scope and saying to them, listen, things just like they do for you, things cost more. It sucks. Here’s what we’ve been thinking about. We’ve been doing this, this and this all year.

And this one isn’t quite as effective as we thought. We’d like to remove that from the scope so that we can continue working on these two things that are doing extraordinarily well and put more power behind them. That’s a different conversation than saying, we’re going to raise your prices by 10 percent for the same amount of work.

Completely different conversation.

Chip Griffin: Absolutely. And it doesn’t mean that they’ll accept it, but it means that you’re starting from a better position and you’re demonstrating to them that you’re thinking about them and their budget at the same time. And it’s not just all about me, me, me.

Gini Dietrich: Right.

Chip Griffin: I think you need to think about this in terms of scope creep too.

We always tell you if something’s out of scope, you need to draw the line sooner rather than later because the more scope creep you allow, the, the tougher it gets to fix it later. At the same time, if you keep saying to your client, no, that’s out of scope, no, this is out of scope, this is going to cost more, this is going to cost more.

Put yourself in the client’s shoes. That sounds awfully damn annoying to hear every single week. And so what I hear is someone who is being an obstacle rather than a solution. And so my suggestion to you on things like that is. Maybe if you can say, well, that’s not within scope, but what if we took this thing away, that’s not as effective and we swap this in instead.

So try to come up with those same creative solutions, even when it comes to scope creep, so that it doesn’t just become that constant stream of no’s or you need to pay more. Or those kinds of things. You need to find ways to understand what the client needs and is looking for and how you can solve it rather than simply saying no.

Gini Dietrich: Yeah, and I think this is a really easy one for you to put yourself in the other person’s shoes because it’s probably happened to you before. A really good example of this is we, a couple of years ago, inherited a web firm with a new client. They were a brand new client at the time. And about two months into the relationship over Thanksgiving week, the web firm updated all the plugins and everything, and it completely took the website down because of some thing that they had used, that the web firm had used, it was no longer being supported, completely took the website down.

And so I’m, preparing – my team’s all off right, because we closed the the office between for the week of Thanksgiving and it was the night before Thanksgiving. i have 30 people coming to my house I’m preparing you know my in laws are here, like I have a whole house full of people And the web firm is saying to me, well, we need 1, 500 to fix it.

And I was like, but you broke it. Right. And so then I’m having to field calls from the client, the CEO of the client’s office, and the president then calls me and like, we were having this conversation between the three of us trying to figure out what to do with this web firm who keeps saying, sorry, it’s 1500 bucks just to, just to have a conversation to fix it.

I was so frustrated because I felt like the client was being nickled and dimed. They were the ones who broke it and maybe it would have cost 1, 500 to fix it. That’s fine, but they wouldn’t even get on the phone without a credit card and paying the 1, 500 first. So I think you have to think about that, about it from all of those perspectives. Completely different conversation if they had said, Oh my gosh, we totally broke this. We’re so sorry. The theme is outdated. Whatever happens to be, we’re going to fix it. And then come back a couple hours later and say, we have to do this, this, and this, so it’s probably going to be 1, 500. Okay, we would have paid it. But instead, it was like, it’s a completely different conversation.

So you just think about it from that perspective. And I’m sure you’ve had experiences where you’ve been nickel and dimed like that. Maybe not in the professional life, but in your personal life. You have a plumber there, or at your house, or an electrician at your house, and it’s, it’s just like, oh my gosh.

So, when you, when you can understand that kind of frustration, I think it’s really easy for you to understand how the client might feel, even if you’re right. Even if it is out of scope, and they are asking for things that you shouldn’t be doing, or they’re not paying for, fine, but let’s find a different way to communicate that.

Chip Griffin: And, and billing is a perfect place to put yourself in the shoes of a client, because it is easy for someone to feel nickel and dimed, even if maybe they’re not. And I think back to my very earliest days in the agency world, and we’ve talked about this before, where it was very common for agencies to charge you by the page for a fax or a copy.

Gini Dietrich: Yeah. Right.

Chip Griffin: You know, those kinds of things. And, and I got to tell you that when I was hiring agencies in the nineties, it drove me nuts to get these invoices that would have the, and every time I saw the fax machine in my office come on and start spitting out pages, I’m sitting there thinking, this agency is charging me a dollar per page for all of the junk coming through.

And so instead of looking at it as they’re providing me good information, I need this. I looked at it as, Oh my God, the cost is being run up there. And, and, and recently I was reading a LinkedIn post where someone was talking about a lawyer and their first bill from this lawyer. And it included time spent for writing the engagement agreement, preparing the initial invoice, those kinds of things.

And people were saying, well, of course he needs to get paid for that. Sure. Roll it into the rest of your stuff. Don’t itemize it. Don’t put down on the invoice that you’re being charged for the invoice. I know a lot of agencies like to put in a specific project management fee because, and they’ll say things like project management is such an important part of the engagement.

We’re going to charge you for it directly. No. Wrap it into others. Because if I sit there and I see project management, I think, Oh my God. This is just, you’re just eating up my time on silly stuff. Not true. You need project management. It absolutely makes for a more successful relationship. Roll it into other things.

Don’t draw my eye to it. Think about all of these things and how the recipient is perceiving it because it will make a big difference for very little effort on your part.

Gini Dietrich: We actually used to do it very, very early in my agency life. So early. And partly because I came from a big agency where we charged a dollar per page for faxes.

But we did a 10 percent expense fee, which, which covered things like phone calls and at that time your cell phone bill and things like that. And, and GE was one of our clients and finally they said to us, can you just roll that into your fee? And I was like, what?

Chip Griffin: Right.

Gini Dietrich: Yeah. Because same thing. It drove them crazy.

And I didn’t realize that that was driving them crazy because that’s what we did at Fleishman Hillard. You charged for all that stuff. You charged for going out to dinner with them. You, you, like, you charged for all of it. If you even thought about the client, you charged for it. So it’s just really important to understand that and to say to yourself, if I received this, how would, how would I perceive it?

What would be my reaction?

Chip Griffin: And sometimes the, the client’s perception may not be because of something that you do, but of something that you don’t do. We all know that as agency client relationships go on. We sort of get into that mode where we just want to be protective of the relationship. We want to make sure that they stick around.

We don’t want to do anything that might rock the boat. So, yeah, we want to be careful. We’re mindful that they don’t want to hear no to scope creep. So we, and we’re mindful that they don’t want to spend more money. So what do we do? We turtle. And we, we try to just have the minimum amount of contact with the client in order to keep things moving because we don’t want to be in a situation where we have to say no to that request because it’s scope creep.

We don’t want to be throwing out new ideas because we know they’re going to get shot down or they’re simply going to try to get us to do it within the existing fee. And so we’re afraid to suggest new stuff. From the client’s perspective though, when we start to do that, we start to look non responsive.

We start to, that one of the biggest reasons that clients give when they leave an agency is they, they stopped being creative. They stopped coming to me with ideas. Well, the reason why is because they were being shot down most of the time on those things. But you need to understand that once you turtle, it turns into something where the client is now perceiving you as not a real partner in things.

So while you’re, you may be not rocking the boat and you may buy a little bit more time in the relationship, you’re definitely souring it much more so than by having an honest conversation with the client.

Gini Dietrich: Yeah, and I think there’s opportunity for you as well to sort of meet in the middle.

And, you know, there have been times where we’ve been completely over, over scope, and we’ve spent way more budget than we should have, and I’ve paid my team way more than they should have gotten for, for certain things. And I haven’t said anything. And there have been times where we’ve been way over scope and we’ve, we’re way over budget.

And I have said something. And both of those, in both of those instances, it has not ended well for us. So you have to find a way to meet in the middle as well. And say, hey listen, we’re over budget and we’re over scope because of this, this and this. So let’s take a look at what we have planned for the rest of the year and really think through what we need to do.

And I will tell you, a few years ago, probably right around the pandemic, we started doing something that has been incredibly successful. We do, you and I have talked about, you don’t really have annual contracts, you’re month to month or maybe 60 days depending on what your termination clause is. We never, no longer have annual plans.

We do them by quarter. And we do, we, we set OKRs, objectives and keys, key results for our clients, just like we do for our own business. And every quarter we review them with the senior leadership at our clients’ businesses. And we say, we do a SWOT analysis. We say, this is, this worked really well. We have some big opportunities here.

This sucked and here’s why. And because this sucked, we’d like to not continue doing this and probably bring in something else. And every time we have that quarterly conversation, not only do we get a budget increase, but we get a scope increase as well, every quarter without fail. And it’s because we’re willing to have that really hard conversation and even be honest to say, you know, we tried this and it didn’t really work and here’s why.

Right. And it becomes a partnership so that now you’re having conversations instead of when something big happens and you’re over budget or you’re over scope and you have to have this hard, hard conversation. Because it’s been a year or it’s been eight months and you haven’t done anything about it. Now you’re having those conversations consistently and it’s part of your partnership and it doesn’t become this big conflict conversation that you have to have, which is, I think, why we turtle because we don’t, we don’t, we want to avoid the conflict and we don’t want to have the conversation.

Chip Griffin: Right. And the reality is, as you’re saying, the more frequent and regular your communication is, the better it is. And if you can do that, you can deal with the stuff that comes up, but the longer you let things fester on either side, the worse it gets. And the harder it is to resolve it.

But I also want to talk about not just clients. I think this is important to put yourself in the shoes of your employees.

Gini Dietrich: Yes.

Chip Griffin: Because, you know, these days, most agencies are trying to get by with fewer staff than before, because it’s been tough the last couple of years financially for most agencies, whether they’ve seen a decrease or just kind of holding steady.

Most agencies are not growing like gangbusters. So they’re not adding a lot of team members. We’ve seen in the SAGA owner surveys that people are not planning to add employees anytime soon. So we’re asking for more from our teams. And so we need to think about how the things that we’re doing and saying to them is being perceived by the teams that we have in place.

I think some, some little things are, can get magnified really easily. I think back to my dad who owned a law firm, when I was a kid. And he would always have the employees at his firm have to pick between the day after Thanksgiving or the day after Christmas to take off.

Gini Dietrich: Oh, geez.

Are you serious?

Chip Griffin: Yes. And, and in fairness, the courthouses were open those days. So there was, there was a rationale for it because

Gini Dietrich: Okay.

Chip Griffin: Potentially they were doing more, and, and things honestly were different in the 70s and 80s. Fair. Fair. And how things like that were perceived. But, but even then, that just struck me as silly.

And, and I think today, if you were to, to offer your employees that same choice, it would be really negatively received. And most agencies aren’t doing that specific thing today, but there are plenty of things like that, that you might be doing where you feel like you’re giving the employee a choice, but they may not be looking at it that way.

They may be looking at it as sort of like, you know, which kid do I have to sacrifice? And, and so you don’t want people to perceive things in that way. But I think the most important thing with employees is how you’re giving feedback. And I think this is an area where most small agency owners, or at least a lot of them, are falling down on the job because we have a certain expectation for how things should be done.

And we really want to impress upon our team that we want it done that way. And so what that comes across to as the employee, though, typically is that we’re micromanaging them. That we don’t trust them. And so, so we really need to think about whether we’re editing a document or an email or providing feedback on a conversation.

Think about what’s absolutely necessary to convey. And think about how the employee is perceiving all of the other stuff that you’re communicating along the way. Because you may be making things worse rather than better. Or at the very least, you may be diminishing morale, even if you’re increasing performance in the short term.

Gini Dietrich: I think that’s such a good lesson because I had a situation where I was working inside an agency a few years ago to help their owner. And she treated me that way. She edited everything I did. She questioned every recommendation I made. And I was like, I’m sorry, I have more experience than you do. Like what?

But it was, it wasn’t me. It was the way that she did it with everyone. And I finally had to say to her, you’re making me feel like shit. And if you make me feel like this, imagine what your team feels like. You can’t figure out why you’re losing people as fast as you are. Her turnover rate was every six months.

And she couldn’t figure it out. This is why. This is why it’s because you are micromanaging. It makes me feel terrible. It makes me feel like you don’t trust me. It makes me feel like I don’t know what I’m doing. And those things are not true. I actually do know what I’m doing. And if I feel this way, your people do for sure.

And it was a really good lesson because I think you have to really understand that. That, If somebody’s questioning your work and editing everything that you turn in and, and saying, Oh, I don’t know about this idea, or shooting down your ideas. How does that make you feel? Cause I guarantee your employees feel that times 10.

Chip Griffin: Yeah, absolutely. And I do, I hear owners all the time complaining about, you know, clients who micromanage and rewriting everything and all that. And, and, and yet they’re doing the same with their teams. And look, this is a lesson that I’ve had to learn and relearn over the years myself. Because I, you know,

I have a way I want things done. I completely fess up to that. And, and I have a tendency to say, okay, this is exactly, and so I’ll just sit there and I’ll rewrite something rather than providing feedback. When I had developers working for them, I said, well, I’ll just code it or do it exactly this way. Not well received.

I’m sure not. It’s possible that the way that I’m doing it was absolutely that much better. Honestly though, probably not. It was probably incrementally better. And so what I have, have learned over the years and have tried to do more of is to provide general feedback and guidance as opposed to actually getting in there and editing directly, et cetera.

And even with the general guidance, thinking through what’s really going to make a difference here? And, and not, not a 0. 1 percent difference, but you know, a meaningful difference. And, and so I try to control myself now so that if I’m providing feedback, it’s really only for those substantial things.

And I think if owners did that more, they would be being perceived better by their teams. And, and so we really need to think about how everything that comes out of our mouth, every email that we send, every policy decision that we have about what our hours are, what flexibility we’re going to give to our team.

Or how we’re going to push them to get a project done by a certain time. It doesn’t mean we shouldn’t do what’s right for the business, but we need to think about how it’s being perceived before we move forward and either accept that we’re okay with the potential negative consequences or change so that we don’t get them.

Gini Dietrich: Yeah, I think it’s really, really good advice to always put yourself in the other person’s shoes. One lesson I had to learn early on was I couldn’t take negative feedback from a client and then email it to my team in the middle of the night. So you have to really, really think about those things. And if you aren’t sure, like there are tons of leadership resources on the web.

There are tons of really great leadership books. It’s leadership. It’s leadership of your team. It’s leadership of your clients, it’s leadership of your agency. And that’s what you should be aiming toward. Not management, but leading. Not, not managing, not micromanaging, not telling them unintentionally that you don’t trust them, but leading them the way that you want them to go.

Chip Griffin: And, and what you’ve addressed there, particularly feedback from clients and not sending them in the middle of the night, you also need to remember you’re, you should be a buffer as the owner. You don’t need to pass every bit of the feedback onto the employees. Pass on what’s useful, pass on what’s necessary. You don’t need to, if the client gives you a really raw feedback, you know, I really hate what Sally did on this thing.

It was just awful. We can’t do that again. You don’t need to go to Sally and tell Sally that. No, you don’t. You can come up with a more constructive way, which the client should have done in the first place. Correct. But if the client doesn’t do it, doesn’t do it, you should do it as you pass it along, because you need to think about how it’s perceived and what it means.

Gini Dietrich: And don’t do it in writing. Have a conversation.

Chip Griffin: Oh, so, so much shouldn’t be done in writing that, that gets done in writing. I…

Gini Dietrich: I know.

Chip Griffin: I, yeah, that’s a topic for another day, I suppose, but maybe that, maybe that’s the former investigator in me who, you know, loved having things in writing because it was…

Gini Dietrich: Never put anything in writing.

Chip Griffin: Yeah. All right. Well, this, this is not in writing. Well, I guess we’re going to have a transcript. So it is kind of in writing at the end of the day and we do have a video of it. So it’s hard for us to say we didn’t say any of these things, but in the end that will bring to a, to an end this episode of the Agency Leadership Podcast.

I’m Chip Griffin.

Gini Dietrich: I’m Gini Dietrich.

Chip Griffin: And it depends.

In this episode, Chip and Gini discuss the complexities of pricing strategies for agency engagements.

They explore whether agencies should charge more upfront for initial work, the importance of consistent revenue, and creative approaches to managing client expectations and financials.

The conversation emphasizes understanding client perceptions and the necessity of knowing one’s financials to ensure profitability.

Key takeaways

• Chip Griffin: “Certainly think about those upfront costs, but I would try to amortize it over the course of the engagement. I think that’s a much better approach for ultimately winning the business.”
• Gini Dietrich: “The first thing you have to do is understand your financials and if you don’t have the mind to be able to do it or you avoid it or you don’t want to do it, hire somebody to help you because if you don’t know those numbers intimately, you will not know how long it’s going to take before you are break even.”
• Chip Griffin: “There are so many creative approaches that you can take to solving this problem of overwork at the front end of an engagement that you’re not able to recoup otherwise.”
• Gini Dietrich: “Put yourself in the prospect’s shoes and say, Okay, if I were being pitched this program, how would it make me feel? Would I be able to do it? Really think about it from their perspective so that you can start to figure out if it makes sense.”

Related

• Using paid discovery to get better clients
• Adapting your agency for risk-averse clients
• 9 ways to price your agency’s services

View Transcript

The following is a computer-generated transcript. Please listen to the audio to confirm accuracy.

Chip Griffin: Hello and welcome to another episode of the Agency Leadership Podcast. I’m Chip Griffin.

Gini Dietrich: And I’m Gini Dietrich.

Chip Griffin: And Gini, I think, I think we’re gonna need to charge a little bit more for the first few minutes of this show.

Gini Dietrich: Great. Let’s do it.

Chip Griffin: So let’s see. How about we do 50 percent more than what we usually charge people to listen to the, to the show?

Gini Dietrich: So like the first 10 minutes?

Chip Griffin: Sure. So let’s see. So,

Gini Dietrich: so right now we charge 0 per minute.

50 percent more.

Chip Griffin: And if we add 50 percent to that. Let’s see.

I don’t have a calculator here, but I’m pretty sure that’s still zero.

Gini Dietrich: I think you’re right. Yeah. I think it’s still zero.

Chip Griffin: Well, so what? You still get to listen to this for free.

Good news, everybody.

Gini Dietrich: Woohoo!

Chip Griffin: So, no, but we are going to talk about a question that was asked. This is, this came up in the Solo PR Pros Facebook group, of which I am part. And so someone posted recently about whether or not they should charge more for the early stages of an engagement. For all of the work that comes along with starting to work for a client, right? Because when you start working for a client, there, there’s typically a burst of work that takes place that, that tends to most of the time, slow down over time as you get established and you’ve got all the basic tools in place. The question is, whether you’re a solo or an agency or whatever, should you be charging more?

Should you be charging a setup fee or something like that in order to get started with an engagement?

Gini Dietrich: Yeah, I think like anything else, it depends and there are pros and cons to both. It’s an interesting idea. Personally, I prefer to have consistent revenue that I can count on every month. And so I tend to just pace it out over 12 months.

So that I have that, the same amount of revenue in every month. But I can also see the argument being made for doing some upfront or set up fee or something like that to get started. Clients may like that they have, you know, that there’s a burst of activity and then, and then the retainer goes down a little bit.

They may like that and they may not. So I think, but I think there is an argument to be made for it for sure. Just, I would just from my own perspective, I like to have the consistent same amount every month that I can count on.

Chip Griffin: Yeah, I mean, I think the… I would agree with everything you said. And in general, I think over the course of my own agency career, I don’t, I can’t really recall too many instances where I did charge more upfront, unless there was some specific project that was taking place separate and, and distinct from the monthly retainer that would be paid going forward.

And I don’t mean just, you know, work on, on my part or my team’s part, but… you know, that, that was noticeably different to the client. And, and I often talk about, you know, how there is sort of, a bell curve of profitability for engagements with clients for agencies. And so your profitability tends to be very low upfront for this very reason that this question gets to, which is there is work upfront with almost every engagement that you have.

And then over time you become more efficient. And you can produce good results in less time, you start to know the client, so it’s just, it’s so much more efficient, you start to become profitable. And then at some point you start to get afraid of losing that client, and so you start over servicing, and you’ve accumulated a lot of, just, what if we just did a little of this and a little of that, and all of those things stick around, and so your profitability then wanes towards the end of the relationship.

So, so this would, charging up front would be one way to adjust that front end of the bell curve. I think to me, the biggest problem with this is that it makes the decision more difficult for the prospect. And we talk about if you want to try to close more business as an agency, you want to de risk the engagement as much as possible.

Telling them they have to make essentially a balloon payment up front is going to be more challenging in order to close the deal. Because if you’re say, talking about a 2, 500 or 5, 000 a month retainer, And all of a sudden you say, but the first month is going to be 7, 500.

Gini Dietrich: Right.

Chip Griffin: It starts to become more challenging to close the deal because now in their minds, instead of looking at 2, 500 a month, they’re looking at 7, 500

Gini Dietrich: right

Chip Griffin: up front.

And so you’ve now made it a riskier decision. So I would prefer to, to certainly think about those upfront costs, but I would try to amortize it over the course of the engagement. And I think that’s a much better approach for ultimately winning the business.

Gini Dietrich: Yeah, I mean, and that’s what I personally prefer to do as well.

I also think there’s an opportunity when you do that for budget growth, because you, you haven’t used the budget, the client doesn’t feel like they’ve used all their budget up front. Right. So you have the opportunity to say, okay, after the first quarter, here’s everything that we did. Here are the results.

 I like to use AI to, to help with the analysis now. So I throw the data into AI and I say, point out strengths, weaknesses, opportunities, and threats. What can we focus on? What should we not be focusing on? Where, what should we do away with? And it’s not perfect, but it gives you some really good ideas and you can go back to the client and say, okay, here’s our quarterly report.

Here are our results. Here’s what we did really well. Here’s some things we think we should change. And, oh, by the way, here’s some things that we think we should add on. And it gives the client the opportunity to say, yeah, actually, that’s a really good idea. I can find some money for that. Or I’m not quite ready for that, or I like that instead of this.

And since this isn’t working, can we replace that work with this new idea? So it gives you the opportunity to sort of have that converse or that partnership conversation with your clients. In a really interesting way versus saying, okay, well, we’ve used all your money up front because we had these upfront costs and now we don’t have anything less.

It gives you the opportunity to sort of make them feel like you’re more of a partner.

Chip Griffin: Absolutely. And I think it also, I think there are other alternatives that you can think of. So if you do have really substantial upfront costs, more so than what one might normally think, then there are two different approaches that I personally like and would urge you to consider.

The first one is something we talk about here a lot, which is paid discovery. So instead of going directly into a retainer engagement, pitch some sort of a discovery type project, strategic engagement, planning process, something like that, where it’s a very defined work product that you’re putting together, and there’s a very defined price for it, and it may be higher than what your monthly engagement would be going forward, but you’re also giving them a very concrete deliverable that they can see and is tangible to them, and you’re still de risking it for them because they could simply say, No, we don’t want to proceed after this.

And so I would prefer that over saying it’s a 12 month engagement, but month one or month two is going to be, you know, a higher number. So consider that because now you’re, you’re getting the best of both worlds. You’re getting paid for all of that upfront work. But you’re also doing a discovery project that, to your point, allows you to identify other things that they might want to hire you to do.

You’re able to figure out, does your pricing for that monthly engagement need to change? Because you’ve seen how they operate, and we talk about this all the time. It’s as much for you to feel them out as it is for, for them to understand you. And so I, so that would be the first option that I would suggest that you consider.

Instead of some sort of a setup fee on top of moving directly into the monthly engagement.

Gini Dietrich: To that end, I have a client who does VIP sessions every month. And so when she’s working with a prospect, she will say, I have four dates available this month for a VIP session. And they get to choose one of the dates and it makes them feel special.

And the, the VIP session is the, a day that she just focuses on that new client and does exactly that. Like some discovery, she does some research, she does competitive analysis, she does all of this stuff. She probably meets with them for two or three hours of that day. They’ve reserved that day to help her with marketing and PR questions and making sure she has everything she needs, getting her the reports, getting her access, all that kind of stuff.

 And she charges a good sum of money for it and the client feels really special. It’s like, Oh, this is, I’m a VIP and this is like, it just goes to that human psychology piece of it. And it gives her everything she needs so she doesn’t have to say, okay, well we need access to this, this, this, and this, and then wait a week.

And then we need this, this, this, and this and wait another week. And like, so it gives her the opportunity to get everything that she needs done in one day. She blocks off her calendar. She, she and her team focus just on that one client. To get everything done and the client does the same. And, and she, she tries a good, good sum for it.

So it allows her to do it and they get it all done in one day too, where they don’t have to like drag it out over months and months and months or weeks and weeks and weeks. And the client feels like, wow. And then the client says, okay, well now that you have this and you’re making these recommendations, let’s go for this.

So almost always they sign on with her.

Chip Griffin: Yeah, no, that’s, that’s a great idea. And, and it just goes to show you that there are so many creative approaches that you can take to solving this problem of overwork at the front end of an engagement that you’re not able to recoup otherwise.

The other option that I would encourage you to consider, and this is, this is really if you take my approach, which is, I know one that you don’t agree with, Gini, but my approach of just doing month to month engagements.

I, I, I have been doing that for 25 years, with all of my businesses. I love it. I’m committed to it. I know that you think I probably should be committed for it, but it is what it is.

Gini Dietrich: I do.

Chip Griffin: And, and it has worked for me for 25 years, so why would I give it up? But if you are in that same mindset where you have really a 30 day out for anybody who is with you, and frankly, many of you, we’ve talked about this before, many of you who have annual contracts still have 30 day outs.

Yep. So you don’t really have annual contracts. Yep. So. Some of you may. Some of you may require that people pay for the full year. But if you have any kind of 30, 60, 90 day out, that’s the length of your actual contract. So, put that in your head first. The other option in those cases, if you are operating that way, where you do have a 30 day, 60 day out, or you’re doing month to month explicitly, or however you’re handling it, is to require a minimum engagement to make sure that you recoup the cost.

And so with some of the, the project work that I’ve, or some of the retainer work rather that I’ve done over the years where it required a substantial amount of upfront stuff. And I think of this in terms of particularly, clients who hired my agency for reporting and analysis type work. There’s a huge amount of upfront work to do all the configuration of the reports that collect data and putting all the pieces together and doing whatever subscriptions you need and all of those kinds of things.

And so in those cases, what I would do is I would have a minimum engagement of three, four, six months, whatever it took, I did the math to make sure that at the least I come out break even. Right. And so you need to figure out where do you at least make sure you’re not losing money. Now, the reality is most clients stay beyond it.

So you actually start making money, but by putting a minimum length of the engagement in there that they can’t just break out of, that can be another way to solve this problem so that you make sure that you’re, you’re not really putting your, your own business at risk during that setup stage.

Gini Dietrich: Yeah. It’s, I mean, the reason I don’t agree with it is because I think that too many clients say, Oh, well, you have a 30 day out and I’m just going to give you two weeks notice. And then you’re screwed. Like you don’t have the income and, and I, I prefer to have, to know that I have consistent income and it usually takes me 60 days to replace a client.

So if I have 60 days, we can make sure that transition is done correctly and that, you know, they get everything that they need. And on my side of the thing of the business, I can ensure that that client is replaced. So I keep the pipeline nice and full. But, like, you do have a point that if you have a 30 day out, it’s month to month.

So, I do like the idea of saying this, you have to, it’s a minimum agreement of three months or four months or six months or whatever it happens to be so that you don’t lose money on the deal. But I think that’s a nice compromise to where we both are.

Chip Griffin: Yeah. I mean, well, one of the reasons why I like it too, is it allows you to have the conversation with the prospect to explain to them.

Normally I don’t have that, but because of all of the upfront work that’s involved, that’s why this is required for this particular project. And so it helps, it helps them to understand that you’re really going to be putting in a lot of extra upfront effort, but you’re not making them pay for it. So, yeah, at least not explicitly, right?

And so, you know, it can be a selling point as well as part of the conversation because you’re trying to make it look like you’re trying to help them in the process when the reality is you’re helping yourself and making sure that you don’t end up upside down on the deal.

Gini Dietrich: I think that that requires something that a lot of agency owners struggle with, which is understanding how to charge for things, understanding how to price for things, understanding what your profitability is.

You have to understand your financials so intimately to be able to do this that you can’t screw it up. So that like nowhere should you, that is the first thing you have to do is understand those financials and if you don’t have the mind to be able to do it or you avoid it or you don’t want to do it, hire somebody to help you because if you don’t know those numbers intimately, you will not know how long it’s going to take before you are break even.

You won’t know.

Chip Griffin: You’ve got to know your numbers. Have to know them. You absolutely have to. So all these people out there were like, Oh, time sheets are silly. You don’t need to do that. You just stop, stop. You need to know. You need to know what your work is costing you to do. I don’t care how profitable you are.

You can be a wildly profitable firm. And, and so your instinct may be, well, I don’t care then what… you care because you, you still need, if you want to keep growing, you need to figure out which projects you should be taking on or which projects you shouldn’t. And it often surprises people when they actually dig into the data what it actually costs to complete work.

Gini Dietrich: Yeah, yeah.

Chip Griffin: But now that I’ve, I’ve completely spent the last, you know, 15 minutes dumping on the idea of charging more upfront. I do wanna, to carve out one circumstance in which you may want to consider that approach. Okay. Because, because it, to me, there is one time when it does make sense for just ongoing retainer work to charge more for the first month, two, three, whatever it is.

And that is if the perception from the client is that you are doing a lot more work in that window.

Gini Dietrich: Oh, sure.

Chip Griffin: In other words, if you are spending a lot more time with them or providing them with a lot more deliverables, in that case, you should carve it out and either do it as a discovery project or charge more for those months.

Because otherwise, it becomes very difficult for the client to see you pull back two or three months down the road. And so if they’re used to hearing from you every single day during those first couple of months, and all of a sudden, they only hear from you once a week. That’s a problem if they’re paying the same amount.

And so it helps them to understand, we were doing a lot more work, you paid for it. Now you’re paying less, and so we’re pulling back. And so, that is the one exception for me, to my overall guidance of not charging more. If it’s mostly behind the scenes work, because you’re doing all of the, the learning, and the setup, and the building of the list, and all, and most of it is, is not something that the client is actually seeing, that’s when you shouldn’t charge.

If it is that you’re spending time with the client, they’re seeing you, they’re hearing from you, they’re getting things delivered to them. That’s the one time where you may want to consider that higher up front so that they can see as their money goes down so does your work product?

Gini Dietrich: Yeah, that’s a really good point.

So behind the scenes you’re okay. If you’re in front of them, maybe you should think about it But again, you have to know your numbers and you’re gonna have to know your process really really well And they will be able to be able to do this.

Chip Griffin: Right? Yeah And it’s really it’s because you need to think about this from your perspective as well as the client’s. And I think that’s, that would sort of sum up the overall advice I have here, which is, you know, think about not just how are you making your books correct, but think about how the client is perceiving it.

And so if you’re charging more but they’re not seeing additional work, well then that’s increasing the risk from their perspective. If, you know, if you want to protect against over servicing over time because they’ve come to expect that they hear from you every day and that you’re sending them tons and tons of stuff, Well, then, then you do need to charge so they can see that.

So make sure you look at it, not just from your perspective, but how the client perceives it as well.

Gini Dietrich: And the last thing I will say is that I always like to put myself in the shoes of the buyer. So if I’m hiring somebody and they want to charge me three times more, two times more than they would get in the first three months than they would the last nine months.

I need to understand why and what makes me comfortable. And if I can’t get there, if I’m in the buyer’s shoes, then I probably shouldn’t do it. So if you can put yourself in their shoes and say, Okay, if I were being pitched this program, how would it make me feel? Would I be able to do it? What questions would I have?

And really think about it from their perspective so that you can start to figure out what makes sense and what doesn’t.

Chip Griffin: Absolutely. I think that’s a good place to wrap up this episode because we’ve given all the advice we have on this and we didn’t charge you any extra for it.

Gini Dietrich: We did not.

You still paid us zero dollars.

Chip Griffin: Zero dollars. Zero

Gini Dietrich: dollars. Completely free.

Chip Griffin: Some people might say that they’re getting what they pay for here, but others feel like they’re getting a good deal. Hopefully if you’ve listened all the way through to this point, you’re one of those folks who think it’s a great deal. So with that, that draws to an end this episode of the Agency Leadership Podcast.

I’m Chip Griffin.

Gini Dietrich: I’m Gini Dietrich.

Chip Griffin: And it depends.

In this episode, Chip and Gini discuss PR professionals wanting a seat at the table when it comes to business decision-making.

They explore the need for PR professionals to build relationships across departments, understand business dynamics, and communicate openly with other stakeholders.

The conversation emphasizes the value of collaboration, learning from each other, and navigating interdepartmental challenges to drive business growth and improve client relationships.

Key takeaways

• Gini Dietrich: “You should have relationships with people from different departments, and you should not bristle when they want to give you input on things because they look at things through a different lens and all it’s going to do is help you.”
• Chip Griffin: “The vast majority of PR folks, in house or agency side, don’t know enough about business to be true business strategists.”
• Gini Dietrich: “If you can have an open enough mind to invite them to your table, to be able to have those conversations and to listen, I think you’re going to have the opportunity to grow budgets, grow relationships, grow trust, grow all of the things that you need to do to be able to maintain clients for a really long time.”
• Chip Griffin: “You can have an opinion as a consumer, as a user, as a general member of the target audience. But that is different from professional advice based on expertise.”

Related

• Handling clients who disagree with your agency’s advice
• 7 reasons clients ignore advice from your agency

View Transcript

The following is a computer-generated transcript. Please listen to the audio to confirm accuracy.

Chip Griffin: Hello and welcome to another episode of the Agency Leadership Podcast. I’m Chip Griffin.

Gini Dietrich: And I’m Gini Dietrich.

Chip Griffin: And Gini, I’d like a seat at the table.

Gini Dietrich: Okay, no problem.

Chip Griffin: Actually, I guess I’m already sitting at a desk here. And so I guess we have a seat at the table with each other at least.

Gini Dietrich: You’d have to move the puppy, but you could sit at this, in this chair at this table.

Chip Griffin: Well, I’d also have to travel like a thousand miles, so. Little things.

Gini Dietrich: Well, fair, yeah. You can have a seat at this table.

Chip Griffin: Well, thank you. You’re welcome. I appreciate that. But no, we are going to be talking about a seat at the table because that is something that PR pros, not just in the agency world, but in house and all of that, are almost always advocating for.

I hear over and over again, you know, we, you need to give the PR folks, the communicators, a seat at the table for big business decisions so that they can be in on the advice. And at the same time, I’ve observed that most PR folks bristle when non PR people want to offer their input on PR activities, right?

So if the CFO or the accounting team or the product team or the sales team wants to weigh in with the in house communicators or with the PR agency, they’re like, Hey, we’re the experts. Leave us alone. So I thought it would be worth exploring this a little bit, both from the perspective of how do you, and should you be involved in business decisions?

And also, how should you react when others want to participate in your decision making and your activities?

Gini Dietrich: You know, it’s funny because Muckrack just released their state of measurement report and I’m doing some content on it right now that hasn’t, that’ll be published in a couple of weeks. But one of the findings was that they are, that most communicators are and marketers to some, a certain extent, are creating a measurement reports in silos.

And they’re not talking to the executives. So they’re not talking to the finance team and they’re not talking to the sales team. And communicators aren’t talking to the marketing team and vice versa. And so. You’re, you’re doing this and you’re reporting metrics in this silo that doesn’t make sense for the business.

So extrapolate that out. If you’re doing that, why would you expect to have a seat at the table if you’re not willing to have relationships with sales and with finance and with HR and with the executive team to be able to do even that, let alone strategy, right? So these are the kinds of things that I think we have to be thinking about is… first of all, you should have relationships with those people and you should not bristle when they want to give you input on things because they have a different, they look at things through a different lens and all it’s going to do is help you.

Are there going to be times where you sort of roll your eyes inside your head and, and because they, what they’re telling you is not going to work? Sure. Yeah, like for sure. But you should have relationships with people from those teams. If you want a seat at the table, and you want to measure the right kinds of things, and you want to be taken seriously.

Chip Griffin: Yeah, I mean, I think you really have to start with being open to dialogue and encouraging those other departments or stakeholders to be open to dialogue with you. And so that means you both have to be in a mode of listening and understanding. And that will absolutely help you in the work that you’re doing in PR.

I think we also need to understand, frankly, what our own limits are. Because one of the other things that I’ve observed is that a lot of PR folks feel like they ought to be giving business advice. And the number of agencies that I’ve encountered in the last couple of years who have said to me, Well, you know, we’re really not just PR strategists, we’re really business strategists.

And really, we take a much broader view, and that’s why we get hired. Let me just say that the vast majority of PR folks, in house or agency side, don’t know enough about business to be a true business strategist.

Gini Dietrich: Correct.

Chip Griffin: And that, that’s just a cold, hard truth.

Gini Dietrich: Yes.

Chip Griffin: And so if you’re going to be offering that advice, you need to be doing it from a position where you actually understand what you’re doing and what the implications of it are. Because you may see it one way, but you don’t have the same knowledge that’s on the other side of the table.

The same is true for you. So when someone comes to you and says, you ought to pitch this to the Wall Street Journal, they’ll, they’ll love it. They’ll take it for tomorrow’s paper. And you say, well, I hear what you’re saying, but… So you need to be ready for that same reaction when you come in, particularly if you’re someone who, you know, you don’t necessarily think in business and financial terms on a day to day basis. Which frankly, most agency owners, not just small agency owners, but most even mid sized agency owners are not really thinking about P& Ls and business tactics and all of those things in the, in the same way that their clients are. And so you need to be really careful about understanding what is the limit of your expertise so that you’re not, you’re not going so far outside your lane that you lose credibility.

Gini Dietrich: It’s kind of like the 25 year old life coaches. I’m sorry, you’re a life coach? You’re 25 years old. What, what are you gonna coach on? Right? You haven’t lived yet. See, it’s the same kind of thing, and I know I’ve told this story before, but for about 10 years I sat on the, on the board of an organization here in, in Chicago that was very financial oriented.

And so the other members, the other board members were accountants, CPAs, there was an HR person and me. And for, we would, we’d have quarterly half day meetings and for three hours of the meeting, it was all, because it was a, of an accounting firm, it was all financials. And I used to sit in those meetings with just like deer in the headlights kind of look because I was like, I have no idea what’s happening here. And then they always reserve the last hour for, for me, but you know, those first three hours I had to sort of endure. And in the beginning, I would take notes furiously on terms that I didn’t understand, or things that they were talking about that I didn’t understand.

And then I would come back to my desk, and I would Google, and I would research, and I would learn. And then I’d go to the next quarterly meeting, and there’d be something else new. But after about two years, I started to really understand what it was that they were talking about, and I understood business growth and business development in a different way, because I was surrounded by these finance people.

And I, I always encourage people to do the same sort of thing. You don’t necessarily need to be on the board of an organization, but perhaps you have, you have a mentor who’s in accounting. Or you have a mentor who’s a leader at a different organization. Like, find people that you can surround yourself with so that you begin to understand how businesses grow, what kinds of things, like I I’m sitting on a board of another organization right now.

And it’s really fun to watch the CEO because he has it perfected, this formula perfected on how they grow. And he knows exactly if we do this, this and this, we’re going to reach X in revenue. He knows exactly. And he also knows what hurdles they’re going to have to get over. And so those kinds of key learnings, especially for a professional services firm that can’t be that exacting, it’s really, it’s, it opens up your eyes and it teaches you things that you wouldn’t necessarily get running your own business.

So find people that you can surround yourself with that will give you that kind of education so that you can sit at the table and understand what they’re talking about and provide counsel from your lens to help the organization grow.

Chip Griffin: Yeah, there’s absolutely huge value in improving your own knowledge and understanding of business concepts.

It’ll help you in your business. It helps you in the advice that you’re able to give clients. It helps you in refining your own communications strategies, frankly, because you understand how it all interacts in a better way. It’s also one of the best arguments for specialization as an agency. Because if you are working with similar types of businesses or organizations on an ongoing basis, you start to understand the vocabulary, the challenges, the opportunities.

You understand the mechanics of how the businesses and organizations work. And all of that helps you. So there’s, there’s a huge value to that. And I want to be clear. I am not in any way suggesting that you don’t have anything to contribute to the conversation when it comes to business decisions. I think PR absolutely has things to contribute.

But you need to contribute from your area of expertise and not go in and tell people, this is how the product should be changed. Right? Because, ultimately, that’s not advice, that’s an opinion. Right. And there is an important difference. You can have an opinion as a consumer, as a user, as a general member of the, the target audience.

But that is different from professional advice based on expertise. Both have value, but there is a big difference in both how you would communicate that and how it will be received. Yep. And so if you are focusing on how you can convey your perspective, understand the difference between those two.

Gini Dietrich: Yeah, I think that’s really smart.

And you know, one of the things that to, to the start of this recording, which is, you know, we say we want a seat at the table, we want a seat at the table, we want a seat at the table, but we’re not willing to do the extra work to be able to get there. So figure out what it is that your organization, your client’s organizations do to grow.

One of the things that I do is I have at least a twice a month phone call or Zoom meeting with the VP of sales for all of our clients. And the reason I do that is because I can get an insight into what they’re working with, what they’re struggling with, what their prospects are saying, and how we might be able to help, right?

So, those conversations are invaluable and my team will always be like, I don’t understand why you’re having these conversations. And I’m, and I explained that it gives us the insight that we need to be able to help them grow further. And it also provides opportunities for me to say, Oh, you know what? Why don’t we do X, Y, and Z and, and then we can, we grow budget because when I can go back to the CEO and say, Hey, The VP of sales and I were having this conversation and we think we might be able to do this or we’d like to test this.

You almost always get extra budget to try that kind of stuff. So it gives you an opportunity to be able to, to grow the client as well. So it’s just, it’s not a bad practice. Yes, it takes some time. Yes, you have to learn all of the things, right. And we all are all meeting’ed out, but I do it twice a month.

I don’t do it every week. And it provides me the opportunity to just look at, at things in a new way that I wouldn’t necessarily see because I don’t have a sales lens.

Chip Griffin: Yeah, I know that there’s huge value in those kinds of conversations and, and the more that you open yourself up to that, the more that you’re willing to give a seat at your table to some of these other folks, the more willing they will be to not only give you that seat, but to listen to you.

And so that means we have to be willing to listen even to things that we think are kind of crazy. We need to control our impulse to roll our eyes at least right in their face. You know, after we hang up from the zoom call, we can be like, Oh my God, I really cannot believe…

Gini Dietrich: Cannot get this in the Wall Street Journal tomorrow.

Chip Griffin: No. But you need to, to treat it respectfully and you need to help educate them, not in a condescending you don’t know anything about what I do kind of way, which is often the immediate impulse when someone asks for something, because we know people ask for crazy stuff when it comes to PR and marketing. We know that they just don’t have a grasp for how long it takes to do things or, or any of that. And that’s fine. We need to help educate them, but we need to do it in a way that is respectful of them.

Because they bring expertise to the table too. They bring valid advice and opinions to the table too. And it does, what we do matters to that. And, and if we’re, if we’re doing what we think is great from a PR perspective, that’s fantastic. But we’re not going to succeed if it’s not driving other things in the business.

So we need to have that strong relationship. And so I, I love that you, you’re talking to folks outside of the communications team at your own clients, right? That is a perfect example of what agencies should be looking for more ways to do. Even if occasionally you hear things that you don’t want to hear. Because it’s, it’s useful to know that that’s what they’re saying, right?

It does me no good to know that, you know, the sales team is having a whisper campaign after I’ve already been fired, right? If the sales team is agitating about how bad we’re doing our jobs, if we’re doing marketing and creating leads, or if we’re in, earned media and, and they don’t feel like what we’re doing is helping them.

I want to know that as soon as possible. Yep. Because I can counter that. Or adjust my strategies, or adjust my reporting, or do something. If I only find out after my contract’s ended, what good has that done me?

Gini Dietrich: That’s right. Yeah. I think one of the things, too, that you start to learn is how, what’s the word I want?

Protective? Different departments are of their own fiefdom, because we’re human beings, right? And it, I think it gives you some valuable insight into how, exactly what you just said, you can report results. Because, we had a situation a couple of years ago where the VP of sales and I were working really well together and we were generating a ton of qualified leads. But the sales team wasn’t, wasn’t converting them.

And so I was reporting on all of these leads that we were generating, qualified leads that we were generating. And then there was this huge drop off when the, at the conversion point. And sales felt like we were blaming them and in my reporting, which I wasn’t, I was just showing the, the data, right? And what I discovered is that while they were qualified, they were too small, the VP of sales felt it was too small for them, for those, for his team to follow up on. And so instead of what, what we came to eventually, it was hard, but what we came to eventually is creating a DIY kind of process for those kinds of leads so that we could continue to generate those kinds of leads, but they would create their own, they would go through their own process.

And then the sales team could focus on higher level, bigger types of clients. Had we not, had I not had such a good relationship with the VP of sales where we had, I mean, we had some down and dirty drag out fights where I was like, you’re not converting and he’s like, these are not the right leads. And we like, we were both banging heads and we were really stubborn, but we finally came to this conclusion that there was an opportunity for us to create a whole new path for sales.

Through some of the content that we were creating and the, the journey that we had created. So we wouldn’t have gotten to that and we probably would have been fired had I not worked through that frustration with that VP of sales.

Chip Griffin: Yeah. And I mean, it’s a normal dynamic in any business organization that sales blames the product or service delivery people or the marketers for producing leads, you know, it’s always someone else.

Nobody ever jumps up, the PR agencies included, and said, Oh, I’m Yeah. I kind of sucked at what I did last quarter. That’s, that’s why things are where they are. Everybody always says that they’re doing the best that they can. And everybody, by and large, is doing the best that they can. It’s those conversations you have with those other stakeholders where you can figure out, to your point, how you can make those little adjustments

that don’t even, a lot of times they don’t even require a lot of effort that can improve the overall outcome. But if both sides aren’t willing to come and have an open conversation and both sides aren’t willing to make change based on those conversations, you’ll never get there. And so I don’t care if the organization that you’re working with, they all think PR is stupid.

They think you’re doing a horrible job. Treat them with respect. Treat them as if what everything they’re saying is credible. It will help you in the long run and you will get better results if you are the bigger person and you walk into those conversations and try to have them openly and honestly. And yeah, you take whatever arrows come.

I mean, it’s going to happen.

Gini Dietrich: Yeah. I really like what you said about inviting them to our table. So if you can, if you can have an open enough mind to invite them to your table, to be able to have those conversations and to listen, I think you’re going to have the opportunity to grow budgets, grow relationships, grow trust, grow all of the things that you need to do to be able to maintain clients for a really long time.

Chip Griffin: Yeah. I mean, look, I, I always say this: Clients, they’re like kids. You’ve got to lead by example. And so, you know, if you want your kids to start sharing food, you have to offer to share your food with them first. Share your food with your clients. It’s awesome. Share your food with the sales team, with the product team, with whomever it is who would like to offer, the CFO, whoever would like to offer their opinion and perspective, Listen openly, share your food.

Gini Dietrich: I love it. I think that’s really good advice. Let them have a seat at your table first.

Chip Griffin: So with that, I’m now hungry, so I’m gonna have to go have some lunch. Me too. So that will bring to an end this episode of the Agency Leadership Podcast. I’m Chip Griffin.

Gini Dietrich: And that’s Olivia Benson, and I’m Gini Dietrich.

Chip Griffin: And it depends.

In this episode, Chip and Gini discuss the common challenges agencies face in obtaining timely feedback and necessary information from clients.

They explore strategies for improving communication, managing client expectations, and the importance of having difficult conversations to maintain strong client relationships.

The conversation emphasizes the need for agencies to be proactive in addressing issues and becoming strategic counselors rather than mere order takers.

Key takeaways

• Chip Griffin: “The clients never blame themselves or say, ‘we know this fell apart because of us’. They always point the finger of blame at the agency they’re paying.”
• Gini Dietrich: “One of the questions you should ask your direct reports in every one-to-one meeting is what obstacles are you facing and how do we help you?”
• Chip Griffin: “At some point, whoever is the senior person on the client side needs to understand what’s not happening on their side. Because it has an impact on the outcome.”
• Gini Dietrich: “The good news is there’s a lot of project tracking software today that helps, because the client will get notifications and reminders that don’t have to come from you nagging them.

Related

• Setting expectations for agency clients
• Why (and how) clients should manage their PR/marketing agencies

View Transcript

The following is a computer-generated transcript. Please listen to the audio to confirm accuracy.

Chip Griffin: Hello and welcome to another episode of the Agency Leadership Podcast. I’m Chip Griffin.

Gini Dietrich: And I’m Gini Dietrich.

Chip Griffin: Gini, I think we need to talk about the fact that I’m just not getting enough timely feedback from you and input on topics and research and all of that kind of thing.

Gini Dietrich: Okay. I like it. Let’s do that.

Do I get to give the feedback now?

Chip Griffin: I thought I was going to give you the feedback.

Gini Dietrich: Shoot. I thought you were not getting timely feedback from me.

Chip Griffin: I wasn’t, but I was going to give you feedback on your lack of feedback. I wasn’t actually. Yeah.

Gini Dietrich: Oh, that’s very meta, okay.

Chip Griffin: I, I’m afraid, I’m afraid what would happen if you actually started giving me feedback.

Gini Dietrich: You should be afraid.

Chip Griffin: Yeah, but no, we are going to talk about what happens when agencies are not getting what they need from their clients, whether that is feedback or research or access or approvals or edits or whatever, because this is a common challenge that agencies of all sizes have, but it, it has a particular impact on small agencies because you can’t be successful in most cases.

If you are not truly working in partnership with your clients and getting things from them to move the ball forward. And that might be trying to arrange to get an expert on an interview with a reporter or something like that. And so you need to get schedules and can coordinate it. Not every client is good with that.

Many clients are really bad about giving you timely feedback on drafts and things like that. So what are some strategies for dealing with it? And how do you avoid getting in a situation where you fail because you didn’t get what you need from the client? Because the clients never blame themselves. I, I’ve yet to see a circumstance where the client’s like, yeah, you know, we know this fell apart because of us.

They always point the finger of blame at the agency they’re paying.

Gini Dietrich: Yes. Yeah, yeah, yeah. You know, I mean, this has been a recurring theme throughout my career, of course. And this is, of course, why it’s a topic, because I think it’s a recurring theme for all of us. The good news is, is there’s a lot of software today that helps with that, because they will get notifications and things like that, that don’t have to come from you, but come from the software.

So there, there is that option. But even still, like we have one client we’re getting access and information from their subject matter experts continues to be one of our biggest challenges and we have tried everything. And then even when we get the information from the SMAE and we, we will like, I, I tested this just to see because my team gets so frustrated by it.

They will take the SMAE’s words verbatim and put them into content and the subject matter expert will be like, Nope, this isn’t right. And you’re like, Oh my gosh, it’s exactly what you said. So there, there are all sorts of challenges to this, but I think one of the biggest advantages we have today and going forward is, is access to software that will help us with some of it.

Chip Griffin: And, and so just elaborate on that a little bit. I assume you’re talking about project tracking software that shows what the blockers are and things like that.

Gini Dietrich: Yeah. I mean, project management software is one of the biggest things. It’s one of the first questions we ask a new client as we’re onboarding them is what project management system they use.

We have one client right now that doesn’t use anything. They just use spreadsheets. And we’re like, yes, that’s not going to work. So in some cases, we will implement or insert ourselves into their project management system, and in some cases, they will be implemented into ours, just depending on how it works.

And then, you know, they get the, they get the notifications, they get the emails, they get the reminders that say this is coming up due. And, and we, we use ClickUp, so we can say we send them a reminder when it’s three days due, send them a reminder the day before. And so it does, it does all of that for you, so that you don’t have to be the one for lack of a better term, nagging them.

Chip Griffin: Yeah, and I think, I think that is one of the keys is that you have to have some sort of a way of making clear to everybody who owes what when. And software obviously does make that so much easier today. But it may also be that in whatever regular reporting that you’re doing with clients, you need to make clear here are the things that we are still waiting on.

Because a lot of times, particularly if you’re dealing with multiple contacts within an organization, the project, the lead on the client side may not be aware of exactly what is not happening on their side. And they can light a fire if they know about it. But a lot of times we on the agency side are afraid to raise those things because, you know, we don’t want to rat out the juniors we’re working with or something like that.

We want to feel like we’re the tattletale. But at some point, whoever is the senior person on the client side needs to understand what’s not happening on their side. Because it has an impact on the outcome. And you don’t want to wait till the end to say, well, we never got these seven things. They need to know it when they can still do something about it.

And before there has been a failure.

Gini Dietrich: Yeah. And I think that’s part of, I think overall agencies can do a better job of onboarding client, new clients and going through that process with them. To say, listen, and, and maybe it’s not onboarding a brand new client. Maybe it’s starting a new project or starting a new campaign to say, okay, do we all agree that this is the end deliverable and the due date then, and then we’ll back it out from there.

And. If you, like clients, if you don’t meet these deadlines, then this is what will happen. And then as you’re going through the process to say, okay, this is due in two days. If you don’t get it to us, it’s going to push this, this, and this back. So It’s sort of like the whole, it’s the same kind of conversation that you have when you’re over, when you’re about to over service.

We’re happy to do that for you, but here’s how, here’s how it will affect the rest of the budget, the campaign, whatever it happens to be. It’s the same conversation. It’s continuing to have those open and transparent conversations. And it’s not, it’s not bad. It’s not critical. It’s just, hey, listen, this is due in two days.

And if we don’t get it, it’s going to going to affect this, this and this.

Chip Griffin: Yeah. And I think that’s, that’s a valuable piece of insight that you need to be able to show that there are consequences to, to the actions. And here is what that consequence is. And it’s very common, for example, when you are, doing web development, which is something I did with one of my agencies, years ago.

You know, we would have project timelines and when we didn’t get feedback on wireframes, we would say, okay, here’s the updated timeline that now shows where we’re at. So you can, you can literally see in real time the effect of your failure to get consensus on your side or whatever. And you can see these things happening and it then puts it on the client’s

plate to figure out, are we okay with that? Or are we going to do something to light that fire and start getting you things more quickly?

Gini Dietrich: Right. And I think we see a lot of this too, in, earnings releases. I mean, we do, or we do work with a lot of startups. So when they go to announce a new round of funding, they always want to make changes the morning that you’re announcing it and you’re like, you can’t make changes.

It’s already been uploaded to the wire. It’s about, you can’t, we’re done, right? Right. Or they don’t get you stuff the day before they want to announce. And so then it pushes it back because as it turns out, you can’t just go to business wire and upload something and have it released five minutes later.

So they have to understand that there are implications and consequences to your point when they don’t do it. And I think it’s, it’s less about wanting to be people pleasers and wanting to, to not tattle and more about, Hey, listen, we all have a job to do and we need you to do, to do your part for like, we’ll manage as much as we can, but you still have to do your part.

Chip Griffin: Yeah. And I, and I think it is, it is becoming more complicated. Some, some things are becoming easier because we’ve got software, as you mentioned. But I think it’s becoming more complicated because clients are looking to find ways to reduce the costs that they have with agencies. And so often they will come to the agency and say, well, what if we take on some of this work and you take on some of this work?

And so if you’re in a situation where the client, for example, says, okay, well, we’ll, we’ll take on doing the research part of it, we’ll send you the research, and then you’ll just write from that, for example. Versus, you know, maybe five years ago when budgets were a little bit richer, they would have just said, hey, you do the research, you do the writing, we’ll just approve it.

And so now they’re, they’re trying to, to find ways to, to do some burden sharing so that they don’t have to put as much money on the table to the agency. But that then makes it more difficult because now we’re into a realm of not really just getting feedback and approvals, which is easy, clear cut. But if you’re not giving me the research that I need, I can’t even start to write.

And so then that creates a, another layer of challenge. And, and I’ve seen agencies who say, well, to make this successful, we’re just going to start doing the research anyway. We know we’re not being paid for it, but we got to do it because we don’t want to get fired or get yelled at because we are not moving forward and hitting the deadlines that we have, even though it’s because we didn’t get these things.

And so it, it’s a very challenging situation for agencies to figure out how to navigate that because in general, I would tell agencies, don’t do work you’re not being paid to do.

Gini Dietrich: Don’t do that. Right.

Chip Griffin: At the same time, if you don’t do it. And if you start missing deadlines, it’s a, it’s a challenge sometimes to sell that.

And so some things like feedback and approvals, you can’t take on yourself, but when it’s work you can take on yourself, that really, I think is where the big challenge lies for agencies today.

Gini Dietrich: Well, and then it becomes an over service piece for you. So say, so then you can go back to the client and say, Hey, listen, we’re having trouble getting this accomplished.

We can do the work. Would you like us to adjust the plan? And push budget out so that we’re not going to do A, B, and C later in the year. Would you like to figure out a way to incorporate more budget so that we can get it done for you? Or can we light a fire and get this done? So give them, you know, some options because I think, I think in many cases, not all, but in many cases, the client will say, you know what, let’s just throw some money at it and you guys get it done for us.

We’re just, we’re just too busy. We’re going through a reorg, we’re, you know, whatever it happens to be, there’s stuff that happens internally all the time. That nobody can control. So in some cases, they may just throw money at it to have you do it, but don’t over service without having that conversation.

Chip Griffin: Right.

And I think that that you can’t be afraid to have these difficult conversations with clients. We’ve talked about this before in other areas as well. But you need to be having an open line of communication with your clients so that they understand what challenges exist on your side, on their side, somewhere in the environment, whatever, so that you can address problems earlier, as opposed to waiting until they really come to a head and now it becomes a crisis because the release needs to be out in three days, or the website needs to be launched for an event, or whatever.

You need to be, as soon as you start seeing problems, you need to communicate that. And you need to gradually escalate it as needed in order to get the resolution in terms of changed deadlines, increased budget, modified scope, whatever it is that, that needs to be done to fix it. But at some point you may also get to the realization that there’s no way that you can be successful within the bounds of what the client is paying, allowing, doing, etc.

And so in those cases you may need to have a very difficult conversation with them and say, if this doesn’t get fixed, we’re going to need to end this relationship and that’s not comfortable.

Gini Dietrich: Not comfortable at all.

Chip Griffin: But if you know that you’re not going to succeed there’s no reason to keep banging your head against the wall just because you think you might get a couple more months of cash out of it. Because it because you’re going to sour the relationship even more than it may already have been If you do that, so it’s much better to resolve that sooner rather than later.

Gini Dietrich: Yeah, I’m one of the things I always say to my friends and my coaching clients is listen, you’ve built an agency where trust is the currency. And you have reputation. And most of us grow our agencies because of referrals and, and word of mouth, right?

And our ability to do that is because of our reputation. So why would you avoid having the hard conversations, the critical conversations you need to have to protect your reputation at all costs? That’s what you’re doing. Yeah, it’s hard. Yeah, it’s uncomfortable, but protect your reputation at all costs, because that’s, what’s going to drive your business forward. Every single time.

So, you know, if you’re, if you have a hard time with it, there’s a great book called Critical Conversations. Read it, it will help you sort of think that through. And then it helps you change your mindset in terms of, this is less about, this being a challenging, challenging conversation and more about us finding a way to come together and figure this out.

And, and that may be that you cut ties, but I tell you what, every single time you lose a client or you fire a client, something bigger and better comes along. Every time.

Chip Griffin: Absolutely. And, and, you know, we, we focus mostly here on, on what the agency can do with the client, but there are things that you can do internally as well when you’re in this situation.

And I think as owners, the first thing is we need to make sure that we are aware of the problems that may exist. Fair. Yep. And so we need to communicate to our own team members that if they are running into these obstacles, if they are not getting what they need from the client, they need to make us aware of it so that we can help figure out how to knock down those roadblocks.

And it’s one of the reasons why I’m such a big believer in the weekly one on one. Because that is typically an opportunity where someone can raise, well, we’re just not getting what we need. They might not send a separate email to you or request a separate meeting with you to, to tell you that they’ve got a problem with the client.

But if you’re doing these weekly one on ones, it’s that venue because one of the questions should be, how can I help? What, what obstacles can I get rid of for you? And if one of them is this client isn’t giving me what I need, you can figure out how to address that. So there are internal things that you can be doing as well, in order to address some of that. And, and if you’re not getting timely feedback, or not getting timely research, think about, are there ways that I could get it more easily from the client? In other words, could I reduce their burden? So, for example, if you’re looking for research from a subject matter expert, could you just schedule a call and record it and transcribe it, versus asking them to send you materials?

It might be easier just to get 30 minutes on their calendar, have a conversation, and get either all or most of what you need in that, as opposed to waiting for them to write something up, go through their files, whatever. A lot of times it’s just trapped in their head, and if you can have a conversation, that’s good enough.

And so, think about how you can reduce the level of friction, and so that’s an internal conversation. You know, what, what do we really need? Are we asking for too much from the client? Are we asking for it too timely? In other words, if we know that the client takes a week to give feedback, don’t build a timeline that, that says that they give feedback in 72 hours. Because you know, it’s not going to happen.

It’s one of the reasons why I love paid discovery or initial projects with clients, because you figure out what their cadence is and how timely they are. And do they run around in circles, rethinking things over and over again. Build it into your plan, figure out how you can make it easier for them to do what they need to do.

And for you to succeed. As opposed to just saying, well, this is the way we do it. And we’re going to force square peg round hole.

Gini Dietrich: Right. Yeah. I love that. And I think it’s really important to be able to have those one on one conversations with your team to make sure that you are getting those answers.

And you’re right. One of the questions you should ask in every one to one is what obstacles are you facing and how do we help you? One of the things I’d say, and I think we’re all guilty of this is that we’re moving really fast. We… it’s really easy to jot off an email or to send a Slack message or a Teams message and put it into somebody else’s camp.

 So, and I’m guilty of this as well. But it’s so much easier in some cases to just pick up the phone and say, Hey, do you have five minutes? Or to send an email and say, I know you’re incredibly busy. Can I get 30 minutes to get this off of your plate? And most of the time, people are going to be really agreeable to that.

Gini Dietrich: So I say to my team all the time, pick up the freaking phone. Do not send a Slack message. Do not send an email. Do not text. Pick up the phone and call the client because I promise you, you’re going to save yourself two weeks of frustration if you just do that.

Chip Griffin: Yeah, and anytime you’ve got a relationship with a client where you need to get a steady flow of feedback or information from them, it’s really important.

Have a regular schedule of meetings with them, just as you do a weekly one on one with your own teams. If you, I mean, and not every client needs a weekly call. So I’m not, I’m not advocating that you just, you know, calendar yourself to death here. But if you’ve got someone where you’re, you have a lot of back and forth, where you have a lot of these things, a lot of times reviewing some of those status things on a conference call or zoom call or whatever, it can be a more comfortable way of doing it as opposed to sending that email that says, here are the things we’re missing.

Cause email… it, it, it feels much more accusatory. It feels much more aggressive in many cases. Whereas if we’re just having a conversation, we can say, you know, these are the three things that we’re really waiting on right now. And, then you can have a dialogue back and forth with the client to figure out how are we going to break this down?

And so a lot of times you’ll make progress more quickly by having that call. It’s one of the reasons why I think all these folks who say, well, you know, we need to have fewer meetings. No, you just need to have good meetings. That may mean that some of them go away. But it, it really, meetings can be very effective if you’re using them the right way.

Gini Dietrich: Yes, and meetings don’t have to be an hour long. They don’t have to be 30 minutes long. They can be 10 minutes. And I think that’s the other trap.

Chip Griffin: Very few are. In fairness, very few meetings last 10 minutes.

Gini Dietrich: Sure. Sure. But you can do that. You can schedule a 15 minute meeting. So it doesn’t, I think we get in this trap of everything has to be an hour.

Everything has to be 30 minutes. And that’s not the case. Correct. At all.

Chip Griffin: Correct. But more importantly, you need to go into the meeting and understand what you’re trying to get out of it.

Gini Dietrich: That’s right.

Chip Griffin: Because too many of these meetings you just, you, you wander into and you just kind of like, you kind of wander around aimlessly and talk about.

You need to know what you need to come out of that meeting with and if you’ve got obstacles, if there are things that you need from the client, you need to make sure that you address them early in the conversation and you need to make sure that you keep talking about them until you have resolution on at least what the next step is, not necessarily how you completely solved it, but, but at least make some progress on it so that you come out of it and you don’t end the conversation and go back with your team and say, geez, I feel like we’re right where we started 30 minutes ago.

Gini Dietrich: Right, right, right. Yeah. I mean, I have, we have one client who their chief marketing officer and I very much both like to take walks during the middle of the day. And we usually, she and I usually take walks about the same time of the day and we call each other and we have a conversation. We don’t have a quote unquote scheduled meeting.

There isn’t a like, oh, we have to get this done. It’s just a chat that we have while we take a walk together and figure out like what’s missing, what needs to be done, what’s on the agenda. I know you met with the CEO today. What’s the, what came down from that? And it helps us help our teams. And it’s informal.

It’s not a formal thing. We don’t put it on the calendar. If we miss it, we do, like, it’s not a big deal. We probably do it two or three times a week though. So there are ways that you can get around this sort of, we have to have an hour meeting and it has to be every week and like… find informal ways to be able to get what you need.

Chip Griffin: I mean, the, the bottom line here is, you know, anytime that you’re not getting what you need from a client to be successful, you need to address it as soon as you know it’s a problem or think it might be a problem. You need to find a path to resolution. It’s not going to be the same in every single case.

You need to make sure that you’re having the internal dialogue so that you’re aware of these problems and you can start helping solve the problems on your end too and not just rely on the client. But ultimately you need to get these things resolved because sitting there and just complaining about them is never going to get you anywhere.

Waiting until there’s actual failure is not a good idea.

Overservicing is not a good idea. And so you need to be on top of these things because they’re only going to get worse. As client budgets continue to be tight and probably get tighter, it’s going to be something that you need to focus on because they may have fewer resources on their end to even fulfill some of the requests that you have.

And, and so you need to be in a position where you’re helping to solve these problems for them and helping them understand what you actually need in order to be successful. And what the consequences of, of not getting that are.

Gini Dietrich: That’s right. That’s right. And I think in part, and if you do these things, it puts you in a position of being a strategic counselor and not just an order taker.

Chip Griffin: Yes. So with that,

Gini Dietrich: Listen to us.

Chip Griffin: Listen to us. And, and, Gini, I appreciate all the feedback you’ve given on this topic.

Gini Dietrich: You’re welcome.

Chip Griffin: Today. With that, that will draw to an end this episode of the Agency Leadership Podcast. I’m Chip Griffin.

Gini Dietrich: I’m Gini Dietrich.

Chip Griffin: And it depends.

It’s business as usual in their 250th episode, as Chip and Gini continue to share their unvarnished opinions.

At the risk of this being their last episode, they have once again chosen to tell you what you’re doing wrong as an agency owner.

The hosts share specific examples of agency owners breaking or ignoring rules that they don’t like — or that clients may pressure them to bypass.

They talk about compliance, ethical practices, and risk management for agency owners. They discuss the ramifications of behaviors such as unauthorized account sharing, misclassification of contractors, and copyright violations.

Key takeaways

• Chip Griffin: “As owners, we think about using the agreements that we have and the rules that are in place to our advantage. We ought to be doing the same when those rules apply to us.”
• Gini Dietrich: “When clients ask you to do something that’s unethical or illegal, you have to be able to tell them no.”
• Chip Griffin: “When there’s gray area, you have to make judgments. But if it’s blatant, then I’ve got an issue with it. And I think you should too.”
• Gini Dietrich: “It’s not easy, but it’s ethical. It’s the right thing to do.”

Related

• How to think about HR risks in your agency
• How agencies can avoid common legal mistakes (featuring Sharon Toerek)

View Transcript

The following is a computer-generated transcript. Please listen to the audio to confirm accuracy.

Chip Griffin: Hello and welcome to another episode of the Agency Leadership Podcast. I’m Chip Griffin.

Gini Dietrich: And I’m Gini Dietrich.

Chip Griffin: And Gini, this is our 250th and, and perhaps final episode.

Gini Dietrich: It’s not our final episode, but it is our 250th. That’s amazing.

Chip Griffin: It is, it is. It is amazing that we have managed to accomplish that. I think that’s more episodes than any of my previous podcasts that I’ve done.

I can’t remember how many I ended up doing with Media Bullseye. Cause we stopped, we stopped numbering podcasts and this one, we don’t number it. It’s just our podcast producer, who is my wife, Jen, keeps them numbered behind the scenes.

Gini Dietrich: She emailed us both this morning and was like, by the way, today is 250. And we were both went, Oh,

Chip Griffin: and neither one of us pays enough attention to our own show to know that.

So. I don’t know what that says about us. Well, hopefully we will not scare away all of our listeners, but, but we are going to speak some hard truths, I think, on this episode about,

I guess compliance is probably the best word, most polite word to use here. But I think observationally, we have seen a lot of agency owners

certainly over a long period of time, but particularly recently who don’t necessarily think that all of the rules should apply to them. Correct. And there’s something to be said for breaking the rules in terms of strategy or things like that. But when those rules are laws and regulations, terms of service, contracts, I would suggest to you that these are things that we ought to have more respect for as business owners because we expect that our own clients adhere to the terms that we give them.

And so, when we do things that are outside the bounds of the agreements that we have for laws and regulations that exist, it sets a bad example for our teams. It’s certainly not a good thing just from an ethical standpoint. And so, I think we need to call some of these things out, because they are creating risks, it’s playing with fire to some degree.

For many agencies, but it’s just flat bad behavior and we shouldn’t be engaging in that and, and pushing that forward ourselves.

Gini Dietrich: Okay. So I’m going to ask our listeners or viewers a question. If let’s say that you have an online course that you have spent time and resources and money to build, and you’re selling it to small business owners, other PR people, whatever it happens to be, and industry or something Like that.

 And you find out that one of your students has shared their login with five other people on their team without paying for those other five courses. How does that make you feel? I’m going to guess pretty shitty.

And it doesn’t make you very happy that six people are going through your online course for the price of one. So with that in mind, I think that that sets the stage for the kinds of things that you have to think about from sharing seats, to 1099 employees, to copyrighted things, to taking things off the internet without, without attribution or credit.

It all goes into this big bucket of, to your point, the way that we should behaving as agency owners, as business owners, and as stewards to our clients, because in many cases, it’s illegal and in all cases, it’s unethical.

Chip Griffin: Yeah, and look, I mean, there are plenty of cases where agency owners come to me and they say, Well, look, you know, I’ve got a client who wants me to send my media list to them.

I’m not giving them that list because, you know, we put a lot of effort into that. And our contract doesn’t say that we need to turn over the media list. And so we own it. Or they’ll come to me and they’ll say, you know, the client isn’t paying on time. My contract says they have to pay on time. I want to stop work or a charge a late fee or do something.

And so so we as owners think about using the agreements that we have and the rules that are in place to our advantage.

Gini Dietrich: Right.

Chip Griffin: We ought to be doing the same when those apply to us. And so let’s walk through some of the very specific examples that we see a lot in the agency community. And we’ll start with something that is near and dear to my heart because I used to run a media monitoring business.

And so one of the favorite requests that we always got from clients back in the day was that they wanted the full text of articles, particularly for paywalled sites to be delivered to them. So they didn’t have to click over. They didn’t have to buy an account on the Wall Street Journal or wherever. And we always said, no, no, we’re not going to do that.

because that is a violation of both the terms of service for those sites as well as copyright law. And yet, it is very frequently asked, how can we easily get full text to give to our clients? That’s a question that I get from agency owners. It’s a question that we’ve seen in some discussion groups of late.

And we need to be forceful and tell clients, that is a violation of copyright law. And look, it’s not just that we don’t, we don’t feel comfortable with it. It creates a material risk. I know of agencies who have had to pay incredibly substantial amounts because of sharing full text of articles by email.

Don’t do it.

Gini Dietrich: Don’t do it. Yeah, I mean, I’m, of course, extremely sensitive to this because there have been so many times, like multiple times every week where somebody presents the PESO model in a workshop or in a speaking engagement, they put it in a book. Well, the, the nice thing about most publishers is if it’s published by a publisher, they make you get credit for it.

So, but if they self publish a book, they put it a PESO model in there. They put it on their websites and claim that they do the PESO model, even though they don’t, or they aren’t certified in the process. Like there’s all of this. It’s theft of the PESO model where people pretend like they created it or they change the graphic to match their brand so that it looks like it’s their model and their framework and that’s against the law.

It is against copyright law. We’ve actually offered it for free. If you use it as long in commercial use, as long as you’re not making money from it. So that means you can talk about it in a blog post. You can promote it on social media. You can even say that you’re using it internally for the most part.

What you can’t do is have it in an ebook and put it behind a landing page where you’re collecting email addresses. You can’t do training on it and make money from that. You can’t do a speaking engagement and talk about the PESO model as if you created it without attribution, because you’re getting paid for that.

So there are rules and regulations around this. And so when people ask for things that violate copyright law, my head explodes. I’m just like, no, like, don’t be stupid because I think you’re right. Like, my attorney, because of the, the feedback and direction I’ve given them, they’re pretty nice about it, but they could charge people for using it incorrectly.

What we do right now is we ask for attribution and a link and all that kind of stuff. And if they don’t comply, then we ask them to take it down. We don’t charge them, but you, there are lots and lots and lots of law firms out there that their sole purpose is to protect their client’s IP and their copyrights and they’re I’m sure

at least a good percentage of people listening to this have had an attorney come to them or a law firm come to them and say, you use this photo without attribution or without paying for it on your website and now you owe me 10, 000.

Chip Griffin: And, and like you, I create a lot of things, including photos. So I’m very sensitive to copyright issues, right?

As are most photographers because every photographer has their images stolen. Absolutely. There are literally groups on Facebook where you can take a watermarked photo that says, you know, proof do not remove or whatever in the middle of a photo and, and you will post it to a Facebook group and people will just remove them for you.

Because the AI is such that you can pretty much remove any watermark from an image today.

Gini Dietrich: That’s terrible.

Chip Griffin: And just do what you want with it. That’s terrible. And that is wrong. Now, look, do I think that, that some photographers have some crazy rules around, you know, how they sell their photos and that sort of thing?

Yeah. But you know what? That’s their choice.

Gini Dietrich: Right.

Chip Griffin: And, and It’s not the business decision that I would make in my photography business, but if that’s what their decision is, you don’t get to pick and choose.

Gini Dietrich: Right.

Chip Griffin: And this feeds into my second area, which is sharing of accounts. And again, as the owner of, or former owner of, a media monitoring software as a service provider, we sold accounts to different clients, and we charged more for different clients, we charged additional for extra users, and this is extremely common.

And yet, if you go into most agency owner communities, or solo communities, you will see a regular stream of people saying, we would like to join a share on X service, typically media databases, media monitoring, those kinds of things are the typical targets for this. And there are all sorts of groups put together to share a four or five ways one account. That is not okay unless the terms of service allow it.

Gini Dietrich: Right.

Chip Griffin: And, and it’s not up to you to decide if that’s, if that should be okay or not. You may believe, and you may be absolutely correct, that some of these services are overpriced. Not your call.

Gini Dietrich: Not your call. Right.

Chip Griffin: And so, I, I know that this is probably one of the least popular things that I’ve ever said on this show, but stop doing it.

I know a lot of you are. You shouldn’t be.

Gini Dietrich: You should not, definitely not be doing that.

Chip Griffin: If the terms of service prohibit sharing of accounts, which I pretty much can guarantee you all the providers do, then you need to have a conversation with them and say, Hey, can we set up a share? Some of the providers do have options.

Yes, that’s right.

Where they will either explicitly bless or quietly say it’s okay. And so if you’ve got that kind of arrangement with your provider, you’re not the ones I’m calling out. I’m calling out the ones who do it, you know, completely beneath the radar without getting an okay or winking a nod from the provider or something like that.

It is wrong. It is not for you to decide. Should you lobby the providers to make those options available? Maybe. Should you try to get them to offer lower cost options for small agencies or solos? Sure. Yeah. I mean, I will tell you at CustomScoop, we did detect people who were sharing accounts. We stopped them, but we did offer a lower priced option for solos and small agencies in order to be able to serve them.

I will tell you, candidly, that was probably not a good business decision because as always happens the lowest paying customers tend to be the squeakiest. We see it in our own agencies.

Gini Dietrich: Yep.

Chip Griffin: I guarantee you, if you’re an agency owner listening to this, your lowest paying clients are probably some of your most difficult to service.

Yep. Because that’s just how it is.

Gini Dietrich: Yep.

Chip Griffin: And so you need to be thoughtful about that as well. Look, if you’re going to be using these services and it’s essential to your business, you need to either figure out how to pay for it, how to price correctly to be able to sustain it, or you need to find an alternative method that is permissible and not just you end running the terms of service to try to meet your budget. I know that’s unpopular.

Gini Dietrich: Yeah, and I will tell you, you’re, you’re exactly right, because there are almost every service, not all of them, but almost everyone that we use in the PR industry will have what’s called shared accounts. So you buy a license for five seats, for instance, or three seats, and then they let you go out and quote unquote, resell it to other agency owners.

So they get, it’s a price of, let’s just say for argument’s sake, it’s 900 a year. You can go to, and you get three seats. You can go to two other agency owners and say, I have a seat for 300 bucks a year. I think that’s probably actually pretty low, but for argument’s sake, that’s right. So, but you have the opportunity to do that.

So go back to them and say. This is really expensive for just me. Do you have some sort of bundled program where I could resell it to some of my colleagues to be able to afford this? And almost all of them will do that with you.

Chip Griffin: I don’t know that I’d say almost all, but a lot of them will.

Gini Dietrich: I can’t think of anyone who doesn’t.

Chip Griffin: I can, but we’re not going to get into that.

Gini Dietrich: Well, in that case, I know who.

Chip Griffin: I know more than one, but yes, I’m sure you do know of at least one. In any case, before we get ourselves into any trouble here, we will move on to the next beating them out of the head and shoulders for our listeners. And so my next pet peeve is one we’ve talked about here before, but 1099 classifications here in the U S.

And so if you are an agency owner in the U S I would say there is a nearly 100 percent chance that you have at least one 1099 contractor on your roster. Many of you have a lot more than that. Some of you have only 1099s on your roster and you don’t have any W2 payroll employees. I can tell you that the vast majority of you are not classifying your contractors correctly.

And part of that is because the vast majority of you aren’t even thinking about the classification of contractors. You’re simply saying, I need to hire someone. I’m not hiring an employee. I’m just going to hire, I’m going to pay this person as a contractor. And you never, you never actually go through the steps to determine both at a federal IRS level, as well as a state taxing authority level, whether that is the appropriate classification of the individual.

And so, I would strongly encourage all of you to go through that exercise and determine if the 1099 contractors you have are properly classified. And I will tell you, if you have 100 percent contractors, odds are very good that they are not classified correctly.

Gini Dietrich: Yeah. And if you have a hundred percent contractors who only work for you, they’re definitely not classified correctly.

Chip Griffin: Right. Right. I mean, there are some, there are some easy things that, that are just glaring. Right. So, you know, if you’ve got someone who’s, who only has you as a client, that’s probably a bad thing. If you have someone who is working, you know, the majority of their time just for you. That’s probably not a good thing.

If you call them employees, which I’ve seen owners do,

Gini Dietrich: I have as well.

Chip Griffin: That’s not a good thing. Please do not call contractors employees, please don’t do that. And look, here’s the thing, as with most of what we’ve discussed, whether it’s copyright violations or terms of service violations or whatever, the vast majority of you are never going to get caught. That’s not a good reason.

Gini Dietrich: That’s not the point. Right.

Chip Griffin: And I will tell you that in this particular case. It is rare for an agency to get caught misclassifying 1099s. However, in those instances where an issue does arise, it’s insanely costly because what happens is whether, whether it’s state or federal that determines that you misclassified, they will then go back years and look at all of your contractors and reclassify them.

And that means you have to pay back taxes. Sometimes you have to pay back wages. Sometimes you have to pay back benefits. You have to pay penalties and interest and there’s so much that goes into it that it’s just not worth it.

Gini Dietrich: It’s not worth the risk at all.

Chip Griffin: So you should be doing the right thing. Classify your contractors correctly and you will be in better shape.

I know it’s going to be painful in the short term because some of you are going to have to set up payroll systems that you didn’t have before. Sure. And, and there is, I mean, frankly, one of the challenges is that there are a lot of people who don’t want to be employees. They want to be contractors in part because they are misinformed about the pros and cons of being a 1099 versus a W 2.

The reality is that people think that just because you’re 1099 you can write off all sorts of expenses. That’s not how it works.

Gini Dietrich: Nope. That’s not how it works.

Chip Griffin: Are there some theoretical benefits potentially, and there are certain cases, there are certain people who have special circumstances where being a 1099 actually is better.

But for the vast majority of people, it doesn’t make a material difference to them how they are paid. So some of it may be that you need to go through an education process. And I’m not saying you should never have a 1099, there are valid cases to have 1099s. You just need to make sure that you’re doing it correctly and not just

going that path because it’s the easy route. I think that’s the sort of the, the sum up of some of the messages here. Don’t do the things that are easy, figure out how to do things right, even if it’s hard.

Gini Dietrich: Yeah. And I would say as one last thing too, that when clients ask you to do something that’s unethical or illegal, you have to be able to tell them

no. I think that we tend to be people pleasers and we tend to not want to tell our clients no on things. But that for me is a line you just don’t cross. If you want my team to pull full text of articles of 50, a hundred, 150 articles every month and send it to your you and your team, I’m not going to do that because that’s not a risk I’m willing to take.

If I got caught because my team sent you a hundred full text articles that are behind a paywall every month, that that would take us down. So be, be willing to tell clients no and educate them on why, because unfortunately, not everybody understands that just because it’s on the internet doesn’t mean it’s free.

Chip Griffin: Well yeah, and look, I mean, I’m a realist. I do understand part of the problem is that if, if you say no, there’s probably someone out there who’s going to say yes. Okay. I mean, this is, and having come from the world of politics and public affairs where pretty much everybody from the top to the bottom believes that the rules are kind of elastic and, you know, you should, you should kind of just, you know, figure out how to do what you want to do and, and, you know, to heck with the consequences.

I came from that environment where it was really difficult to say no, because you knew as soon as you said no, there was another consultant or employee or vendor who would say yes. And I mean, honestly, it’s one of the reasons why I don’t do public affairs anymore.

Gini Dietrich: Yeah.

Chip Griffin: Because it, there was so much of that pressure constantly to just kind of bend the rules and do it, whether it was legal, ethical or not.

And it’s, it happens not just in public affairs. I mean, I, I know of specific instances, PR and marketing agencies get pushed on this all the time, whether it’s full text of articles or other things.

Gini Dietrich: Right.

Chip Griffin: And, and it’s up to you to make that decision. But I would strongly encourage you to, to err on the side of the angels here, do the right thing, and if it costs you business, so be it.

So be it. I can sleep better at night knowing that I’m complying with the rules than I could if I, if I was just, you know, raking in extra bucks because I was willing to say yes to whoever came to me.

Gini Dietrich: Yeah, I totally agree with you completely.

Chip Griffin: And look, I’m also not saying, I mean, there are, in some cases there’s gray area and when there’s gray area, you have to make judgments.

What we’ve talked about here are primarily black and white. Yep. It’s just, it’s binary, right or wrong, legal, not legal, comply, not comply. There is gray area. 1099. Perfect example. There are certainly clear cut cases and then there’s the gray area ones. And gray area, you’ve got to make your best determination and I’m not going to fault you if you make a legitimate, honest assessment and you come to a different conclusion than I do.

But if it’s blatant, then I’ve got an issue with it. And I think you should too. So

Gini Dietrich: Yup, 100 per cent.

Chip Griffin: Bottom line, stop playing with fire, pay more attention to compliance, don’t take the risk, do the right thing. In the end, it will work out for you. It may be a little painful in the short term, particularly if you have to make changes to what you’re doing today,

but please take this message to heart and, and change your behavior.

If you, if you heard yourself in any of these things that we talked about.

Gini Dietrich: Yes, it’s, it’s to your point, it’s not easy, but it’s ethical. It’s the right thing to do. So, abide by it.

Chip Griffin: And we expect it of our clients and the people we work with. Right. So you can’t, you can’t have that kind of a double standard where you expect others.

Gini Dietrich: Yep.

Chip Griffin: To abide by the agreements that you have with them, or the rules that are out there that favor you, and then you just flout the ones that you don’t like.

Gini Dietrich: Yep.

Totally.

Chip Griffin: So with that, that will draw to an end our 250th and final episode. Woohoo! And all the hate mail from everybody saying we don’t ever want to listen to you all again because you were mean to us.

Gini Dietrich: You were mean to us.

Chip Griffin: On that note, thank you all for joining us. I’m Chip Griffin.

Gini Dietrich: I’m Gini Dietrich.

Chip Griffin: And it depends. Except on these things.

In this episode, Chip and Gini discuss strategic planning for growing an agency in 2025. They stress the importance of planning during Q4 and consistently gathering ideas throughout the year, whether digitally or using methods like post-it notes. They highlight the common mistake of agencies relying solely on referrals or word-of-mouth without proactive strategies.

The hosts also emphasize the need for business owners to define their personal and business goals before crafting a detailed strategy to grow, warning against simply emulating others without considering personal business objectives. They touch on diversifying revenue streams and advise focusing on mastering one business development approach well before expanding to other approaches. The importance of involving team members and contractors in the planning process is highlighted to ensure a holistic and informed strategy.

Key takeaways

• Chip Griffin: “You need to make sure that you’re defining what you want from the business before you start putting together the plan for the agency. Because otherwise you’ll just be following some steps that work for someone else, but not for you..”
• Gini Dietrich: “I think a lot of agency owners say, well, I grow by referral and word of mouth, but they don’t actually do anything to help referrals and word of mouth come in.”
• Chip Griffin: “What you need to do is pick one business development strategy and do it well and do it consistently. Once you do that you can think about adding additional tactics to it.”
• Gini Dietrich: “If you hate speaking, if you don’t want to get up on stage, but you hear everybody’s doing it, don’t do it. Because if you don’t enjoy it, you won’t do it consistently.”

Related

• Agency owner growth expectations and business development insights revealed in Q3 SAGA survey
• How to accelerate your agency’s growth in the year ahead
• Smart use of content helps agency business development

View Transcript

The following is a computer-generated transcript. Please listen to the audio to confirm accuracy.

Chip Griffin: Hello and welcome to another episode of the Agency Leadership Podcast. I’m Chip Griffin.

Gini Dietrich: And I’m Gini Dietrich.

Chip Griffin: And Gini, I want to know how do we grow our businesses next year? I realize that’s not a fun, entertaining intro.

Gini Dietrich: I know, but you also, you also started this by flipping me off. So we’re, we’re in good spirits today.

Chip Griffin: Well, you know, you were picking on me and I was having trouble getting the Streamyard thing to record correctly. And so, yes, we were off to a great start, but our goal is to help you to get off to a better start in the year ahead. Cause it’s Q4, so people are starting to make their plans for the next year, or at least thinking about it.

Gini Dietrich: Yes.

Chip Griffin: And it’s better to be planning now than, you know, starting to think about it during the holidays and saying, Oh, wow, it’s January 1. I probably ought to do something different.

Gini Dietrich: Or, or in like March of next year, when you realize you’re not growing the way you thought you would and you start planning.

Chip Griffin: Sure. No, that’s, that’s, that’s fair. But, but I will say that, you know, usually in the first couple of weeks of January, I get a flurry of emails from agency owners who are saying, Oh, you know, I was thinking about it and I need to do something different this year. Uh huh. Think about it now in Q4 so that you can hit the ground running on January 1, as opposed to, you know, not being ready to do something until March or April of next year.

Gini Dietrich: Yeah. I mean, it’s just like you’re doing, you do for clients. You don’t start their planning in January. You start their planning now. So that’s a really good time. You’re already in the mood. You’re already in that mode. Like start thinking about it from your perspective. But one of the things I do is throughout the year, I keep post it notes, and so for those of you on video, you can see my post it notes, of ideas that we have. And then starting about now, I’ll start to put them up on big poster paper and moving things around to say, okay, this is what we want to do this quarter and this quarter and quarter.

So we have, I have a big piece of paper for each quarter. And then once we kind of figure that out, we craft the plan from there. So you. It’s something that I think about all year. It’s something that my team thinks about all year. I just keep it on post it notes on my desk. And then about now is when we’ll start crafting the plan.

Chip Griffin: Post it notes.

Okay.

I mean, you know, the rest of the world has gone digital and you, I mean, I…

Gini Dietrich: It’s one of those things that it’s like, First of all, it’s, it’s in front of me. And secondly, it’s like a quick note, like a quick thing. So I don’t want to have to open a document where I keep stuff. And you know, it’s just the, or my, I might be on a call or I might be doing a podcast recording and somebody says something, I’m like, Oh, that’s a good idea.

And I jot it down on a post it note.

Chip Griffin: Yeah. I mean, look, in all seriousness, it’s a good idea to be collecting ideas throughout the year on all sorts of stuff, your business, your clients, anything else. And so whether you do that digitally. Or whether you do it on paper doesn’t really matter, but it’s, it is a helpful exercise to go through and now is the time to start collating those, bring them together, talking with your teams, flipping through them yourself and just, and, and seeing, do they still resonate?

Sometimes you’ll make a note six months ago and you’ll be like, no, that’s, that was a fleeting thought, but that’s not.

Gini Dietrich: Yeah,

Chip Griffin: that one didn’t hold up too well. But then you see another one. You’re like, Oh, absolutely. I need to zero in on that because that is something that I need to address or that is a helpful idea or what have you, because it doesn’t necessarily have to be an idea of how to solve a problem.

Sometimes it’s just noting that there is a problem so that when you are doing your planning, you can try to figure out how to improve things.

Gini Dietrich: Yeah. So I think it’s really, it’d be really interesting for us to talk today about what that looks, what the plan looks like. Because I think a lot of agency owners say, well, I grow by referral and word of mouth, but they don’t actually do anything to help referrals and word of mouth come in.

They sort of just wait by the phone for it to ring. There are lots of agency owners who say, Oh, well, I’m not I want to start with strategy, but I don’t know how to get clients to pay for strategy or, Oh, you know, we tried that and it didn’t work. So we’re going to do this instead. So I think there’s a lot of like, we’ve done, we’ve kind of grasped at things to see what works and what doesn’t, but there isn’t anything that says, This is what we’re going to do in 2025, and this is how we’re going to achieve it.

Chip Griffin: Can I beat a dead horse first?

Gini Dietrich: Yes, please.

Chip Griffin: So, with all apologies to PETA. Look, you have to start with figuring out what you want from the business, because the, the problem that I see time and time again working with owners is that they come in and they start talking about how to get more clients or generate more revenue, but they haven’t even taken the step of trying to figure out what they want from their business in terms of financial benefit, the kind of work they want to be doing, the amount of work that, so you need to, and that’s something you need to refresh on an annual basis or as life events happen, because what you want this year may not be the same thing that you wanted a year or two ago.

Maybe your family circumstances have changed. Maybe your own personal interests have changed. Maybe, you know, whatever it is, you need to make sure that you’re defining that before you start putting together the plan for the agency. Because otherwise you’ll just be following some steps that, that work for someone else, but not for you. And your business needs to work for you fundamentally.

Otherwise you’ll be miserable. And there’s no point of being a business owner if your business isn’t giving you what you want.

Gini Dietrich: I have such a good point and I don’t think it’s beating a dead horse because it’s a good reminder for all of us. And one of the things that I said in 2019 is we’re going to do less agency work and we’re going to do more Spin Sucks professional development work.

Well then 2020 happened and the world fell apart and clients suddenly needed crisis work. They needed reputation. They needed help understanding how to communicate values. Like there was all this stuff that they needed. And so we jumped back into agency work and had a couple of really bad experiences in the last couple of years, where at the beginning of this year, I said again, so this is five years later again, We’re going to do less agency work.

I’m going to grandfather our current clients in, and we’re going to do more Spin Sucks professional development work. And for the most part, we’ve done a really good job of that. So going into 2025, one of the big goals for us is just to continue down that path. And so I have to constantly remind myself, no, I really appreciate that.

This just came over through email. It’s not the work that we want to be doing because It’s, it’s not the team that I’ve built. It’s not the expertise that we have anymore. It’s not what I want to be doing. So can we do agency work? Of course. Do we still do it? Yes, but I don’t want to be going full feet 100 percent into it.

I want to be focused more on the Spin Sucks side. So it’s a really good reminder. I think for all of us that it’s, this is the kind of business at this point in my life and at this point stage in my career that I want to build. And it doesn’t matter what other people think or say, like stay the course.

Chip Griffin: So now that we’ve beaten people about the head and shoulders and reminded them they need to, to make the business work for them and set their own objectives, you know, now I think it’s fair to talk about it because almost everybody is, is going to want to grow their business in some fashion.

Right. You know? Absolutely. And, and, and the the old saying is if you’re, if you’re not growing, you’re dying as a business that’s, you know, not exactly true, but pretty close. Yeah. And so even if you have a full slate of clients that you’re happy with today, you still need to be out there. Looking for new business because you will lose clients over time.

You will have clients that get out of scope and, and that you need to, you know, bring on better paying clients, more profitable clients, those kinds of things. So there’s always a reason to be out there hunting. And so if you are in that position as 99 percent of our listeners are, if not all of them, how do you think about going about and growing your business in 2025?

Gini Dietrich: Well, there’s a couple of things, right? I mean. We are really great at content and we’re really great at marketing the agency. We’re really good at it. And so a lot of the work that we do, just like anybody listening comes through referrals and word of mouth, but we’re really active in promoting that and in staying top of mind.

So we have the blog, we have a podcast, we have this podcast, we have a LinkedIn newsletter. We have a weekly email newsletter that people can subscribe to. There’s a whole bunch of different things that we’re doing for my business to be able to grow and to stay top of mind. And I’ll still, to this day, a lot of our referrals are a lot of our business comes from referrals. But they come from places that I wouldn’t expect.

Like we just got a gigantic piece of business that the referral came from the American Marketing Association. I don’t have a relationship with the AMA, but they know of us. and they know of the work that we’ve done and they know of the PESO model and they said, listen, if you want to do this, this is who you should talk to.

And, and because of that, so we got that referral from the AMA, but they knew about us because of all the content that we create. And that we have developed around the PESO model. So, you know, I’m big on passive income. I’m big on process. I’m big on all of these things because that’s, what’s going to keep you top of mind and bring those referrals and word of mouth in more actively than you just sitting and waiting for the phone to ring.

Chip Griffin: Yeah. And, ultimately you’ve got to do something, right? So, so I, I think the real problem is, is so many agencies do sit around just waiting for the phone to ring and, and, and that may not be intentional. It may be because they just feel like we’re too busy where it was too much client where we, or, you know, or, or we, we can’t make a decision about what kind of business development strategy to follow.

Ultimately, what you need to do is you need to pick one thing and do it well and do it consistently. Once you do that you can think about adding additional things to it. But the problem that I see is a lot of agencies, when they sit down and do this planning is they say, Oh, you know, Chip and Gini talk about podcasts being a great thing.

We should do that. And I was listening to these other folks who said, you know, you need to have some kind of an outbound strategy. So I’m going to be doing outreach and someone else said, it’s really important to have an email newsletter. So I’m going to start an email newsletter. You can’t do all of the things at once.

And so you need to pick something. And execute on it well, first, then you can think about adding other things. And I’ll tell you, it really doesn’t even matter what that tactic is.

Gini Dietrich: I agree with you.

Chip Griffin: It really doesn’t. I mean, it can be a podcast. It could be blogs. It could be newsletters. It could be LinkedIn strategy.

It could be outreach. I don’t even care what it is. Just pick one thing. And if you do it well and you do it consistently, it’s going to make a difference. Is it going to get you everything you need? Maybe, maybe not. I don’t know, but you’ve got to start there because if you do all of the things at once, I guarantee you, it will not work.

Gini Dietrich: Yeah. And you can’t, like, it’s too, this is what I say to people all the time when they’re implementing the PESO model. Don’t try to do it all at once because you become overwhelmed. You become overwhelmed by it. If you’re going to create an online course, for instance, because you have, you want to develop some passive income, people get all overwhelmed, completely overwhelmed by, I have to produce, I have to write the script and then I have to produce the videos and then I have to have it all

be made beautifully. And then I have to create the online course and then I have to do an LMS. And I like, you don’t have to do all of those things. Just start with a webinar and charge for it and, and build it from there. Like. We try really, really hard to say, this is the one thing I’m going to do. And this is how I’m going to use it to help me grow my business in 2025 and then break it down into easily manageable chunks. So that you’re not saying, Oh, you know, it’s June and I haven’t done anything because I’m so overwhelmed by this gigantic project.

It’s just like anything else that you’re producing for client. You produce those things for clients because you break them into small, manageable chunks. Not because you say, Oh my gosh, I have to have this done by the end of October. And it’s October 15th. That’s not how you do things. And it’s not, it’s the same thing with your own planning.

So to your point, Chip, figure out the one thing that you’re going to do and just do it really well. And then you can grow from there.

Chip Griffin: Well, and let’s, let’s talk about diversifying your revenue streams as well, because that is often part of the plan because they listen to us. And we talk about the value of diversifying your revenue streams, whether that’s simply having retainer and project revenue, or bringing in more passive income streams, as you talk about a lot.

That is often part of the plan, but just like the business development tactics themselves, you can’t go adding a whole bunch of things at once.

Gini Dietrich: Right.

Chip Griffin: And, I would also tell you, you should not be looking to diversify until you’re executing well on what you’ve already got.

Gini Dietrich: Yes.

Chip Griffin: So one of the challenges that I, I often see is that someone will try to introduce a passive revenue stream, but they haven’t even really nailed the their core model of retainer or project or a mix of those two.

And so you need to make sure that you are executing on that well, before you start adding in other things, because otherwise they will all suffer. Now, the one exception would be is if you’re pivoting your business and if you’re saying, okay, I’m moving away from retainer based revenue to projects or to passive or whatever.

Fine. But you need to accept that you’re doing that and it is going to, and you, and you’re going to put the emphasis on that new revenue stream, which you understand will likely harm the existing revenue stream. Because you’re, you’re not likely. I mean, it’s possible that both will work at the same time, but it is unlikely for most small organizations and so you need to be committed.

Gini Dietrich: Right. It’s two different businesses if you’re doing that, because one is service based, fee based, and one is for lack of a better term, product based. So it’s a completely different business. So if you haven’t figured out how to run your business on the agency side, it’s going to be really challenging to try to run it on the product side and to do both. And trust me coming from me, like it’s, it’s really challenging. It’s two different businesses.

Chip Griffin: And, and I would also say, as you’re thinking about business development tactics or revenue streams, you don’t necessarily have to love everything that you do, but you can’t hate it.

Yep. And, and so if you hate cold outreach, I don’t care how many gurus tell you that cold outreach is the answer. Don’t do it. If you hate LinkedIn, do not emphasize LinkedIn. Because if you hate it, you will not move forward with it. Now, it doesn’t mean you have to love it and say, just, I I’m really super passionate about this.

I want to do this. I mean, does it help? Sure. Absolutely. But I think the core thing is to make sure that you don’t hate it. Same thing with different lines of business. If you hate teaching, don’t, you know, create a course or a webinar. See, like if that’s not you don’t do it. You’ve got to get satisfaction from it and you can’t hate it.

Gini Dietrich: Yeah. If you hate speaking, if you don’t want to get up on stage, but you hear everybody’s like, don’t do it. It’s like, because you won’t, if you don’t enjoy it, you won’t do it. So I have one client who has a podcast. And the beginning of this year, we said, I, we, we started to work on it and we said, okay, if this is the one thing that you’re going to use to promote your business in 2024, let’s think about how to do that so that you can actually drive business from it.

And so what she did is created a dream list of clients that she wants to work with. And she started inviting their chief marketing officers or marketing directors on as guests. And they have a discovery call first. So, you know, just like, This is the podcast. Here’s what, you know, do a tech check, all those kinds of things.

Because a lot of these people have never been on podcasts before, or they’re on very few. And during that call, that first call before she has them on the podcast, she askd some questions to get to understand, like, do you have an agency who you’re working with? What works? What doesn’t? She gets, she understands that.

And then she does the podcast interview. And at the end of that, she says, you know, when we were talking before, something like this, when we were talking before you had mentioned that you were really wanting to do some more thought leadership kinds of things this year, I think we can help you with that.

I’ve really been thinking about it. Would you mind, would you like to have that conversation? And nine times out of 10, they say yes. So she’s been able to grow her business doing that with something that she’s already, that she was already doing. But you know, before she was inviting people like that she knew would help grow the audience.

So they were influencers in the space, but not necessarily anybody who was going to help her with her business. And now she only invites people that she wants to work with, you know. That she has like, they’re on her client list, her dream client list. So there are lots of things that you can do, but that the only thing she does is that podcast, that’s it.

And then she promotes it on LinkedIn with a nice video recap. And she promotes it in her email and that’s it. And she’s been able to grow her business this year because of it. So you don’t have to do all the things. Do one thing really well.

Chip Griffin: Right. And, I think what you’ve underscored there too, is that doing one thing doesn’t mean that you just do a podcast, launch it, throw it out there and walk away from it.

Right. It feeds other things, right? So. For me, the podcast that we do here is one of the things that I do, but it gets used in many different ways. There’s an audio version. There’s a video version. It goes in the newsletter. It goes on the website. It goes in our Slack community. I mean, it goes so many different places.

And so that one, that, you know, the 30 minutes that we take to record this. Plus another 30 minutes of just, you know, gossiping and chit chatting and whatever.

Gini Dietrich: Gossiping.

Chip Griffin: It gets reused in a much more useful way. Right. And so we are leveraging the time that we spend in order to get more results out of it.

So when we say focus on one thing, it doesn’t mean literally just one thing. It means that’s the nucleus of it. And you do other things to help build it up, but it’s, everything is oriented around that tactic in order to be successful. As opposed to, we’re going to do a podcast and separately, we’re going to do a whole different blog series and separately, we’re going to do a whole different webinar series and all those things.

Once you execute on one thing, fine. Start adding other things to the mix. There’s nothing wrong with that, but execute well what you’re doing first, before you even think about it.

Gini Dietrich: Yeah. And it’s, I think it, I think it’s a lot less overwhelming when you think about it that way. Like. I’m going to promote the podcast episode this week.

So it’s going to go in the newsletter, it is going to go on LinkedIn. It’s going to go on social media and we’re going to, we’re onto the next, but it’s also helping you grow your business. So it’s helping you stay top of mind for those referrals and word of mouth. And you’re being proactive about inviting guests to be on the podcast, who you think you’d like to work with.

So it helps you in it from, from both sides. So pick one thing, you know, and if it’s content development and you want to invite guests to contribute a quote or things like that, then, you know, if it’s written, if it’s video, if it’s audio, whatever’s comfortable for you, do that first.

Chip Griffin: And the other thing I would say is that as you’re thinking about your growth plan for the next 12 months, get help, talk to your team.

Don’t, don’t do this in isolation where you’re just, you know, sitting there on the couch by yourself, trying to figure it out, involve your team, involve contractors that work for you and know your business well. Work with a coach, join a community. There are all sorts of things that can help you to do a, a better job with your planning so that you’re not just trying to do it all inside your own head, because it is so valuable to get additional perspectives.

Obviously listening to a podcast like this. That’s great, right? But there are other things that you can do that are more interactive, whether that’s joining the Spin Sucks community, the SAGA community, or talking with other agency owners, just saying, Hey, you know, I want to see what you’re seeing and, and, and, you know, how we might be able to collaborate in the new year or what, what lessons you’ve learned over the last 12 months that we can apply for each other, those kinds of things.

There are so many of those opportunities out there. Again, figure out what works for you. If you, if you like to talk with groups of people, join a group. If you’d like one on one help, get one on one help. If you, you know, but certainly use your team. Start there because if you keep your team in the dark, you’re, you’re wasting an incredibly valuable resource.

Gini Dietrich: Yeah. And I think it’s really smart to involve your contractors because I’m sure they see things or have ideas. You know, and they’re working with your clients too. So there may be things that they’re like, Oh, you know, actually this, I had a conversation with so and so and they, so and so client and they suggested this and I forgot to mention it to you. So I think there’s a, I love that idea of, of working with your contractors too, because many of, most of us work with contractors and don’t usually involve them in the planning.

Chip Griffin: Right. And I think it’s, it’s key to understand that it needs to be a win win for them, right?

This can’t be, this can’t be, you’re just trying to, you know, suck free work out of your contractors. It needs to be in terms of, I want to talk about these things because it might create new opportunities for you as well. Yep. And so let’s put our heads together and see what we can come up with. And, and I think a lot of owners are hesitant to ask their contractors for help because they feel like they need to pay them for that.

But if you are brainstorming things that truly are mutually beneficial and that you’re not just, you know, sucking away their time, it, it makes sense for those contractors to work with you and brainstorm as well.

Gini Dietrich: 100%. I totally agree with that. Love that idea.

Chip Griffin: So put your heads together. You get as much advice as you can, put together a plan, focus on one thing and just commit to it.

And once you execute well, you’ll start seeing results.

Gini Dietrich: Do it, do it, do it.

Chip Griffin: So that’s the plan. We’re all done. And, you know, we’ve given you all the information you need and nothing else. You’re all set.

Gini Dietrich: Yep. Don’t tune in next week. Nothing there.

Chip Griffin: No, this is it. Just go back. No, of course you need to tune in next week because I’m sure we’ll be talking about something really intelligent and important next week.

We have no idea what it is because we choose our topic 30 seconds before I hit the record button or sometimes a minute and a half when it takes me a hard, a lot of time to try to figure out how to hit record now in StreamYard, but it is what it is. So, on that note, we’ll wrap up this episode of the Agency Leadership Podcast.

I’m Chip Griffin.

Gini Dietrich: I’m Gini Dietrich.

Chip Griffin: And it depends.

In this episode, Chip and Gini discuss the critical aspects of onboarding new clients in the agency world. They emphasize the importance of setting clear expectations, proactive communication, and understanding client processes.

The conversation includes tips for achieving quick wins without overburdening clients, integrating with client systems, and maintaining a sustainable pace. Both hosts highlight the significance of being adaptable and helpful, ensuring a successful long-term partnership with clients. They also share insights into balancing immediate results with strategic long-term goals.

Key takeaways

• Chip Griffin: “Setting clear expectations is fundamentally the absolute most important thing to do with any kind of relationship, but particularly the agency client relationship.”
• Gini Dietrich: “There are lots of things that you can do really quickly to provide some tangible results that help clients understand that you’re doing work leading up to the longer play stuff.”
• Chip Griffin: “It is a real balancing act to get this right in those early stages, because you need to show enough that it’s worth keeping you around, but not so much that you have nothing left to do.”
• Gini Dietrich: “Our job is to make their jobs easier, and if you’re accustomed to G Suite and Zoom, which I am, going into a Microsoft environment is challenging, but I think it’s important to be able to do those things for the client to make things as easy as possible.”

Related

• Setting expectations for agency clients
• How to onboard new agency clients

View Transcript

The following is a computer-generated transcript. Please listen to the audio to confirm accuracy.

Chip Griffin: Hello and welcome to another episode of the Agency Leadership Podcast. I’m Chip Griffin.

Gini Dietrich: And I’m GIni Dietrich.

Chip Griffin: And GIni, we have a new client of this podcast. We’re going to have to onboard them. I don’t know what a client of the podcast would do, actually, though.

Gini Dietrich: I don’t, yeah, maybe it’s a sponsor.

Chip Griffin: Could be. We get asked about sponsorships pretty regularly, but most of them are pretty sketchy, so.

Gini Dietrich: Yeah. Kind of like link backs.

Chip Griffin: Having a sponsor would be more trouble than it’s worth, I think, so.

Gini Dietrich: I think so too. Yeah.

Chip Griffin: I kind of like that we’re free to say whatever we want and we don’t have to suck up to sponsors.

Gini Dietrich: And we can be honest about vendors in the industry and stuff like that.

Chip Griffin: Yes. But we’re not going to talk about vendors in the industry today because that would probably get us into trouble with or without a sponsor. So, instead Why don’t we talk about onboarding clients because this is a topic that came up recently in the Spin Sucks community and of course if you are not a member of the Spin Sucks community you should absolutely join it over conversations in there and so where do you go to do that Gini?

Gini Dietrich: Oh, Spinsucks.com/Spinsuckscommunity.

Chip Griffin: Because after all these years, you still can’t get the URL Spinsucks.com/community to make it simple for everybody. No,

Gini Dietrich: it doesn’t work. I don’t know why.

Chip Griffin: In any case, go to her website and you’ll be able to sign up for it. And it’s a great place for conversations with people in house, in agencies, all that kind of stuff.

But one of the conversations recently was about how to effectively onboard new clients for your agency. And so since we are all, according to our research, optimistic about what business development holds for the future, we’re going to be onboarding a lot of clients in the agency world. So yeah, we got to figure out how to do it correctly.

Gini Dietrich: Yes. Yeah. Yeah. I actually, it was a really good question. You know, he said, there’s been a substantial amount of digital ink that’s been spilled about how to foster a successful relationship between an agency and a new client partner. But I am interested in the unique perspectives of the agency leaders here beyond the usual setting clear expectations for success in both directions, proactive communication, deep understanding of the client’s business and products.

What are your top battle proven tips for ensuring a successful agency client relationship in, say, the first six months?

Chip Griffin: I mean, the first thing I would do is not just gloss over the setting clear expectations part. Right. I mean, that is, that is fundamentally the absolute most important thing to do with any kind of relationship, but particularly the agency client relationship.

And so I, while it is table stakes, I suppose. And so therefore, you know, as, as part of the question in the community, looking beyond that for other things, I think at first you need to make sure you’re doing that. So if you, if you’re not getting clear expectations, don’t worry about any of the other things that you can do for effective onboarding, because you got to get the expectations right to begin with.

Gini Dietrich: Yeah, absolutely. And I think, you know, One of the things that we’ve seen, and part of the reason I created the PESO model is because so much of the work that we do takes time, and a lot of the work that we do isn’t tangible. And so we have always looked for ways to have really quick wins and to provide tangible results very quickly.

So we can’t, if we’re doing media relations, we might not be able to get you stories placed in the first six months, but we can audit your content and create a content strategy. We can audit your social media networks and create a social media strategy. We can look at what you’re doing from a social media advertising or Google ads perspective and make some tweaks there.

There are lots of things that you can do really quickly to provide some tangible results that help clients understand that you’re doing work leading up to the longer play stuff. So that’s what we always look at is what can we, what’s sort of the, I mean, this is a terrible term, but what’s the low hanging fruit that we can grab onto and get those quick wins really fast while we’re working on the more strategic longer term things.

Chip Griffin: Yeah. And I think the key is to find that low hanging fruit in a way where you can show the results, but also where you’re engaging the client team.

Gini Dietrich: Yes, yes, yes, yes.

Chip Griffin: And I would say, but engaging just the right amount, right? I mean, it really is sort of the Goldilocks principle here. You don’t want to engage them so much that they’re like, Oh my God, they’re asking for so much for me, which I see a lot of agencies do.

They go in and they’re like, they, they asked for this laundry list of resources and giant questionnaires and all that kind of stuff, you know, you’ve got to make sure that what you’re asking for is what you really need in the moment. But you do need to do that because otherwise they’re not having that interaction.

You’re not learning how they work. They’re not seeing how you work. And so you need to do the right amount of that in order to be effective.

Gini Dietrich: Yeah, and I think it’s really about you know, understanding how they work. I see a lot of agencies say, well, this is the process we use. This is the project management software we use.

This is, you know, we won’t use Teams or Outlook or Microsoft documents. I think that’s a mistake. Our job is to make their jobs easier, and if you’re accustomed to G Suite and Zoom, which I am, going into a Microsoft environment is challenging, but I think it’s important to be able to do those things for the client to make things as easy as possible.

So one of the first questions we ask is, usually you know, if they’re using teams or, or zoom, or if they’re using Microsoft or Google, but do you have a project management software that you prefer to use? Can we incorporate ourselves into that? I actually just had this conversation with somebody and they’re like, we still use spreadsheets.

And I was like, okay, well, maybe we could. evolve to software so that we’re not using spreadsheets anymore. But so there are some caveats to that, right? But it’s really about under trying to integrate yourself into their process. What, when are their meetings that you can glom onto without having to have more meetings. Those kinds of things without being able to do the, do your job without giving them more work to do.

Chip Griffin: Yeah, and look, I mean, I do think that it’s, it’s reasonable for you to suggest your solutions, but you can’t force your solutions. So if you do have a preferred project management thing, I’m okay with you saying to the client, typically we use this, does that work for you?

Gini Dietrich: Yep.

Chip Griffin: And, and that’s fine, but telling them this is what we use, period.

You need to adapt to us. That’s wrong. Your role as an agency is to serve the client. That doesn’t mean you need to just, you know, capitulate on absolutely everything. There are certainly, you know, bright lines that you don’t want to cross because it becomes unprofitable work or ineffective work.

But you need to figure out what those really are and not just because, well, we always use zoom and I’m, I’m never using Teams. I mean, I’ll be honest. I hate Teams. Teams hates me. Teams logs me out all the time. It doesn’t let me use my camera correctly. It’ll shut my camera off in the middle of the, it does awful things to me.

Gini Dietrich: Yes.

Chip Griffin: So be it. If I have a client who uses Teams,

I suck it up and I use Teams. Right? You just learn to deal with it.

Gini Dietrich: Right. Right.

Chip Griffin: That doesn’t mean that if I’m setting up the meeting, I’m probably not going to default to setting it up as Zoom unless they tell me that their organization can’t use Zoom for some reason, which some IT departments do block certain programs just for the heck of it, really, because, you know, IT guys like to do those things.

Gini Dietrich: They do. It actually, as an aside, Scott Monty just posted on threads the other day, I have a meeting on Teams in two hours. So I’m going to log in now so I can be ready. It’s this big joke that it’s terrible. And yet people still use it as that was an aside, but

Chip Griffin: it is what it is. But, but part of that onboarding process is to understand.

You know, what are, what are their pain points? What are the things that they care about? And where do you need to adapt versus where you can simply work with the process that you prefer? And, and it is, there’s going to be give and take in this kind of relationship. It can’t just be, I mean, no side is going to quote unquote win everything, but you need to try to accommodate the client as much as possible and only push back if for some reason it’s going to cause a real problem, not just because it’s inconvenient or you don’t like it or that kind of thing.

Gini Dietrich: Yeah. And I think going back to your setting clear expectations earlier, it, that’s really important too, because there are going to be things that are non negotiables for you, and there are going to be certain things that are non negotiables for them as well.

And so understanding those at the beginning of the relationship helps to ensure that there’s smooth sailing going forward. So part of where we talk about our non-negotiables is in the very first meeting. You know, we don’t do this, this and this. We have to have access to your Google Analytics. We have to have access to your marketing automation software.

We have to have access to your website. We have to have access to your social media accounts. If you’re not willing to give us access to those things, we can’t help you. So, setting those expectations and being very clear about them up front is going to help you in the long run.

Chip Griffin: And by the way, if you’re asking for those things, you darn sure need be able to explain why you need that access and how you’re going to use it.

Because again, I’ve seen a lot of agencies who just have a laundry list of things that they request, even if the particular project may not require that particular kind of access or what have you. So you need to make sure that particularly larger organizations that have IT departments and complicated rules and that kind of stuff.

Don’t make the client go through the process. Don’t go through the process yourself if you’re not actually going to take advantage of what you’re getting access to. So make sure that you’re really targeting those requests appropriately and that you, whoever’s asking for it can explain why you need to have that particular access.

Gini Dietrich: Yeah. Don’t just listen to us and say, Oh, okay, I have to have access to all this stuff and then not know why.

Chip Griffin: Right, because it’s, and it may not be for every project that you need it. There may be some projects where you’re doing work with a client where you simply don’t need to have access to their website or their Google Analytics or whatever.

Probably in most cases you do, but make sure that there’s an actual reason for it and you can articulate that when someone says, Well, wait, why do you actually need that? What are you going to do with that information? And by the way, then you actually have to do what you say you’re going to do. So you don’t just say, well, we need it because it helps us to target effectively, and then six months later, you still haven’t accessed the Google analytics that you have access to.

Right? That’s irresponsible. You’ve caused pain for the client for no good reason. And you need to remember that again, your job is to make the client’s life easier, not more difficult. And in large organizations, having access to these things inevitably causes heartburn on their side because they’ve got to go through some kind of process.

They don’t because they don’t want to It’s not like dealing with a small business, like your own agency, where, oh sure, I’ll just go in, I’ll log in, I’ll give you access to Google Analytics. They probably have to fill out some form and go to some other department and get the access there, and then the IT department says, well, wait a minute, why do we get access to that?

Right, right, right. What is this email address that has access? I don’t understand this, this, that.

Gini Dietrich: Yeah.

Chip Griffin: Don’t do it.

Gini Dietrich: Yes. So, Oh, go ahead. I was going to say, I just wrote a blog post on growth hacking and granted it’s specific to PR firms. So keep, keep that in mind when we, when I talk about this, but I think it works across agencies overall, which is growth hacking or quick wins that you can get.

And from a PR perspective, it’s things like creating a database or a bank of statistics that are specific to your industry or your organization that you can use in media relations. It’s having, it’s creating a small group of subject matter experts who will quickly respond to things that you need, like a quote for a journalist request or a quote for a blog post or a quick 30 second video that you’ll post on social media.

Create that group, small group of people that are experts that you can use pretty consistently that will be that are willing to give you that time. Not everybody is. Build an employee advocacy program where you’re working with employees internally to not only understand what their wants, needs and desires are, but also how they will help you promote some of your work.

So there are some things that you can do really quickly. Like I said, as you’re starting out so that you, it gives you a more runway to be able to strategically plan and do the things that you need to do the right way.

Chip Griffin: Absolutely. And I do want to offer a cautionary note on these quick wins though, because you need to be careful that in your zeal to show the client, just how effective you are, that you don’t empty your quiver of arrows too quick, because I see a lot of agencies that come out of the gate really strong and they’re doing lots of great stuff and they’re telling their team, Hey, let’s, you know, let’s bend over backwards. Let’s get everything we can for them. Let’s, you know, we, we got to show them these quick wins in order to, to make the relationship sticky.

It needs to be a sustainable pace. Yeah. So if, if you exhaust every idea you have or every target outlet you get into in the first, you know, three to six months, now, what’s next. Right. So you need, you need to, yes, have those short term wins, but you need to have that longer term understanding of what your plan is.

And it reminds me of a number of years ago, I was running a half marathon in DC. And I had not looked at the course map. In advance, because DC was a place I ran in all the time. I’m like, Oh yeah, I got this. And, and I thought I knew what the route was.

Gini Dietrich: Oh no.

Chip Griffin: And so I came out very strong, not realizing that this course took a weird hook up into some hills in DC.

DC was largely flat. I thought this was going around the monuments, which I ran all the time. It was flat. And instead we all of a sudden made a turn and I’m like, Oh, Oh, there’s a hill here. I should have come out a lot more slowly. So I had a little more gas in the tank here to get up and through these hills in this part of DC.

And so you need to be thinking about those kinds of things and making sure that you’re not coming out so fast and so strong that you either you can’t meet the expectations you’ve now created. Right. Even if they weren’t originally agreed to, and you also need to make sure that you’re not over servicing so much that if you maintain that pace, you can never do the work profitably.

So it is a real balancing act to get this right in those early stages, because you need to show enough that it’s worth keeping you around, but not so much that you have nothing left to do.

Gini Dietrich: Yeah. So think about it like in phases, if you’re going to be doing a content marketing program for instance, then the first phase is doing a really strong content audit.

This is what they have. This is what they need. This is where some gaps are. This is what we can refresh. This is what we can repurpose. And then presenting that to them within the first 30 days. That’s a quick win, but you’re going to use that. And it’s tangible, right? You’re going to use that to propel your content marketing program forward for many months, if not years.

So doing it in phases and saying, okay, if we do this, it’s going to give us a quick win and something tangible to show them that we’re working, but it’s going to do this into the next phase. And then this phase we’ll do this into the next phase. So it allows you to do that without emptying your, all of your arrows.

Chip Griffin: Yeah, I think that’s just so vitally important because if you that we’ve talked about this before. If you start over servicing at any point, whether that’s during the onboarding phase or somewhere in the middle, it’s really difficult to walk that back.

Gini Dietrich: Yep.

Chip Griffin: And so you really need to know what you’re actually putting in in terms of inputs so that you can control that in such a way that you’re still showing results but it is being done profitably. And and if for some reason you know that your process just requires this much extra work up front then you need to figure out how to message that to the client, either by charging an onboarding fee or say, one of the things I used to do was say for this kind of work, because it requires so much upfront, we do have a minimum commitment of time that we don’t usually have. Because I think everybody knows my general view is all agreements ought to be month to month.

And they were generally speaking, but if I knew there was going to be a lot of front loaded work, I’d say, well, look, we need to have a minimum of three to six months or whatever the number was in order to make sure that we broke even. And so they understood that we would be doing more work in those early stages, but it would taper off.

And so you need to be really crystal clear about these things. If for some reason your process requires a lot more upfront work so that the client doesn’t expect that you will keep up that pace for a long period of time afterwards.

Gini Dietrich: Yeah, I think it’s really, I mean, it’s smart to look at how can we demonstrate results fairly quickly. How can we ensure that it’s a pace that we can keep up? How can we create trust and accountability quickly? That’s another one. How do we do this in a way that’s beneficial to both parties so that we can, can continue to grow together?

Chip Griffin: Yeah, and the last thing I would add is communication, right?

I mean, we talk all the time about how we are communicators and yet we are often bad at communicating. And, and so we need to be thinking about how we’re communicating these things to the client. Again, it’s that balancing act, you know, not too much, not too little. We need to make sure that it’s sustainable.

We need to make sure that we understand how they prefer to be communicated with, because we’re not going to figure that out during the prospect phase. We’re going to figure that out during the on boarding. We may learn a little bit during the prospecting phase, but we’ve talked before about how prospecting is a really short actual level of interaction with the client.

Now you’re onboarding. Now you need to figure out, how do they prefer? Do they prefer meetings? Do they prefer emails? Do they prefer Slack? What, how do they take that information and it may be different for different levels within that organization that you’re communicating with and so you need to figure those things out.

How long does it take them to respond right? You can’t simply say, well, I’m going to communicate this to you and I expect a response within 24 hours,

Gini Dietrich: Right.

Chip Griffin: If that’s not how they function,

Gini Dietrich: Right.

Chip Griffin: A lot of large organizations, it takes a while for them to respond and no matter how much you say, well, who do you have to get approval from on it?

They may not either want to tell you, or they may not, they may not even fully understand their own process anyway. So you just need to sort of observe things. And if you know that it takes three or four days for them to get back to you on a particular request, leave that amount of time to get the response.

Don’t, don’t. Go to them and say, I need your response in 24 hours or this thing goes away, right? That can happen occasionally if the weird thing just pops up out of the blue, but you can’t be doing that every time.

All the time. Yeah.

You have to make sure that you’re understanding how they are communicating So that you are fitting in again to their system and their way of doing things not forcing them to do it your way

Gini Dietrich: Yeah.

And I think you’ll find, you know, as you do that, there’ll be peaks and valleys and give and go, and sometimes it’ll work and sometimes you’ll have to readjust and, you know, but it’s really about setting the expectations, being clear about it and giving them enough time in their process to be able to respond to you.

Chip Griffin: Right.

Because the last thing that you want them to do is feel that you are burdening them in any way that you’re spamming them, that you’re asking too much of them, that you’re not doing enough for them, that you, you need to be helpful and you need to be viewed as helpful and anything that you do that goes outside of that is going to threaten your successful onboarding.

So keep that in mind that you are there to help, you are there to serve.

Gini Dietrich: Yeah. And the last thing I will say is that most companies hire agencies because they need the extra help and they need the extra thinking. And the bigger the company gets, the client gets. the more you find that their internal teams are really just project managers who understand the process internally and they’re not true comms or marketing professionals.

So you are truly the expert and inserting yourself and your expertise into their process is one of the best things that you can do.

Chip Griffin: Absolutely. You are at the end of the day, arms and legs.

Gini Dietrich: That’s right.

Chip Griffin: Like it or not.

Gini Dietrich: It’s exactly right.

Chip Griffin: And so on that note, we’re done being your arms and legs for today.

Gini Dietrich: Oh boy. Sometimes you nail it and sometimes.

Chip Griffin: No, sometimes I don’t. Today is one of those days where clearly a failure.

Gini Dietrich: It’s because of your cold.

Chip Griffin: Yeah, that’s right. Yes, that’s what I’m blaming it on, you know, the cold has gotten to my brain and Something I don’t know. Anyway, on that note we’re gonna draw this episode to a close because as often what happens we are going way off the rails I’m Chip Griffin.

Gini Dietrich: I’m GIni Dietrich

Chip Griffin: and it depends

In this episode, Chip and Gini discuss the importance of having clear alcohol policies in agencies.