Opening Scene: Smart Marketing Agency, Low Profits
Working in a session recently with a digital marketing agency, it became quickly apparent that their team was smart, caring, and super talented in all
things marketing. The content, the graphics, social media, design, videos – you need it, they did it – and beautifully, too. After several months in business, they had a list of very satisfied clients.
The Challenge: Their take-home pay was barely cutting it.
Frustrated, they began researching and soon discovered that other small marketing agencies were offering an equivalent array of services at a significantly higher price.
So when they decided to raise their prices to be more in line with expected industry standards, their “raging fan” clients started rebelling and retreating.
“no way, you’re asking for too much money!”
The talented leader of the agency was in a panic – do they keep low prices to retain old clients? How will they ever make a decent income and grow their profits? How long will she be able to retain her team members if the company’s profitability was sluggish?
It happens! And this is something I often guide my clients through. As a business owner for more than 15 years, I’ve been through it myself, so I know all the aches and pains quite well. Whoever came up with the expression, “give them an inch and they’ll take a mile” was likely a business owner trying to keep a “good” client from taking over and overworking them to financial ruin.
The Clear Path: Take Control Away From The Client
Serving your client with your talent and passion doesn’t mean you do it at the expense of your own success! We did some work on discovering their ideal clients. We reviewed, discussed, and pulled apart the last few client interactions. There is often a disconnect between the client you want and the client you wind up with. So with my help, we strategized some tactics that they felt comfortable executing.
I never ask my clients to do something that doesn’t fit their brand, their mission, their core values. We always work in line with who they are as people first, and then the brand and the company entity.
We designed scenarios around set offers at different price points. McDonald’s doesn’t offer filet mignon on the dollar menu. If your client is on a tight budget, what small or modified version of your services can you offer for a small price?
You can decide to implement new pricing for new customers and offer modified packages for current and former clients. Truth is, there are many different permutations of what you can offer and what price you can ask. You can also create payment plan options.
Because of my years of experience, I was able to make suggestions that the client had not thought of. The more we discussed new possible options, the more clear the path forward became for them.
Then they asked, “how do we communicate this change in pricing gracefully?”
We crafted wording that was true to their personality and still honored their clients. We listed possible phrases such as, “I need to protect my profit margin. As a successful business owner yourself, I know you will understand that”.
My clients were pretty excited about the new directions they could take AND how to communicate it to their retreating clients.
“This could definitely work to keep clients from leaving AND protecting us from delivering services at unprofitable rates!” they said.
This occurred during a one-hour coaching session. We continued fine-tuning the new direction at our subsequent sessions.
Would you like to have a no-obligation discussion about where you are in your business and what working with Clear Path Strategy can do for you?
