When Is It Time to Fire Your Client? Agency Leaders Share Their Stories

When Josh Lane, co-founder and chief operating officer at the full-service independent agency FerebeeLane got an MBA in entrepreneurship, one of his venture capital professors told him, “You’ve got to realize that all money is not created equal. Even though they both may be $100 bills, the strings attached to them (or the people attached to them) make them very unequal.”

The business wisdom still resonates with Lane. Having worked in the ad business for nearly 30 years and in 2003 founded his eponymous agency, Lane’s been exposed to his fair share of client vitriol.

“You do realize we own you,” Lane recalled a client once said.

Now, that moment fuels his policy that similar verbal harassment isn’t tolerated at FerebeeLane. Still describing resignation as a “last resort,” Lane and other agency leaders carefully laid out three questions agencies should ask when deciding whether its time to fire a client.

Profitability, culture and quality of work 

Agencies must consider to what extent the partnership is profitable, Lane said. It’s not about account size, but careful scrutiny of whether the client honors the payment terms it agreed to upfront. In other words, is the client a trustworthy guarantor? Also important is accepting that RFP processes alone can’t be comprehensive, so sometimes partnerships that seemed promising can go awry. “You can only know so much,” Lane said. “You don’t actually know the truth of the situation until you start working together.” Agencies should be wary of clients suddenly flip-flopping on payment terms after a project kicks off.

Considering whether a single client is impacting an agency’s internal culture and straining its employees is another crucial step, according to Lane. “One of the biggest things you can do is you can put your money where your mouth is and say that’s a bad relationship for these people, and so we need to resign,” he said. 

Steve Miller, svp, creative director and partner at the Toronto-based creative agency, Fuse Create, said it comes down to ‘fit.’

“That’s kind of a nice word meaning they were assholes,” Miller said. “And we don’t want to work with assholes.” 

One of Miller’s former clients scheduled meetings at the end of their workday, knowing their agency team based in another timezone would have to dial in after hours every time. Not long after that, its team heard a new voice on the line while presenting slides to the client.

“We hear this voice you’ve never heard before,” Miller remembered. “The voice says, ‘Stop, stop, stop, stop, stop.’ And we were like, ‘Okay, what’s what’s the matter?’ And they said, ‘I give this presentation a three out of 10.’” It turned out to be the marketing vice president, a crucial brand side decision-maker the agency team hadn’t even been introduced to.

An education in process

Lane sees his agency as a growth-stage up-and-comer that’s becoming more selective of applicants and it seeks bigger creative jobs. Knowing that creative talent will enjoy working on successful projects, Lane would consider severing ties with a client that shifts its targets so frequently that the account’s creative quality and team morale tank in tandem with one another. 

“The [toxic] client will say, ‘I’ll know when I see it,’ or ‘I know I put you down that direction, but now I need something immediately because my boss has said something different,’” Lane explained. 

When FerebeeLane ended a relationship with a client that all of Lane’s criteria applied to, the client wound up calling back a few years later, having gone through other agency partners and been humbled. “What can we change to make it work this time?” the brand marketers asked Lane. The agency went on to work for them for another four years before amicably parting ways after business needs shifted.

Being willing to educate a client at the relationship’s onset is a must. Miller prioritizes documentation covering the agency’s working style, boundaries and expectations of the partnership. 

For Miller, communicating to difficult clients in a political way requires thoughtful wording. “When a client hears that people don’t want to work on their business? That phrase is a very compelling phrase for clients,” said Miller.  “It doesn’t say that we as an agency don’t want to work on your business, but it’s giving them a hint that ‘Hey, you guys are a tough client to work on.’”  

Fight temptation to settle for un-ideal clients 

When Bob Wiesner was a managing partner at sales effectiveness firm, The Artemis Partnership, he told Lane to wait it out for clients capable of complementing his agency’s goals. It was important for Lane to ask himself three basic questions: Does the potential client want to do the same kind of work as the agency? Will the agency employees get to work with the people they want to? Will the partnership pay fairly? “You might have to say no,” Lane recalled the consultant telling him. 

That agencies should be as scrupulous with client selection as they are in a job interview is obvious. But its not something they always do, and for reasonable rationales. For instance, smaller agencies especially can face layoffs if a toxic client partnership is the one keeping the company afloat. But the decision should be quick if the client crosses a professional or ethical line. Once, Carve Communications had just began work for a client who crossed that line. During a conversation about audience demographics, the client made clearly racist statements. Agency CEO David Barkoe and his team cut off the partnership there.

“We actually not only fired the client, but we returned her [billings] to her … I know it was at least that half of the month that we weren’t working. We’re like, ‘Here! Here’s your money back. We essentially don’t want anything to do with you.’” 

Those resigning should come to the meeting with a plan, the leaders ADWEEK spoke with agreed.“It is trying to take as much of the emotion out of the call as possible, and a plan on how to exit and how to transition. That at least sets up the stage for a smoother separation,’ said Lane.