5 Major Reasons Why Ad Agencies Lose Accounts

485840958This is an “evergreen” topic that remains relevant even as the industry rapidly changes. The communications industry business is and will always be part skill and part relationship. A lacking of either will erode an account, and put it at risk.

I was inspired by a recent post by the wise Paul Gumbinner, 7 Reasons Why/How Ad Agencies Lose Business. Good stuff. There are many reasons why ad agencies (or professional services in general) lose business. But in the end, I think it comes down to 5 major reasons:

1. New client CMO/Marketing Director

This is the easy one—most universal and most frequent. New broom sweeps clean as the saying goes. Not 100% of the time. But this happens all the time. Usually about 6 months after the new CMO appears. What is ironic is that the same agencies who whine about how cruel this is (and it is cruel) are also trying to woo the XYZ Corporation account where their old buddy just became the new CMO. So this goes both ways. Agencies should never forget this as they whine about the cruelty of their business (or celebrate their new account won through their friend, the new CMO).

So, despite that new senior client folk often leads to an account’s demise, it’s better to focus on things you can do (see below)

2. Weak personal relationship with the client

Professional services are a people business. Of course, there is a specific product/service to be delivered, but it is delivered by people to people. Love/respect your clients as people even if they aren’t your cup of tea personally. Connect on whatever personal basis you can. We are all human. People like people who like them (duh). And vice versa.

Negative chatter sticks to the walls. Clients can feel it. Agency heads/senior managers: clean up your act and project positive feelings. And get rid of negative chatter (or negative people). If a client is truly abusive, fire the client. Or at a minimum go above the abusive client’s head and resign to their boss and tell them why.

But try in every way to connect with clients as people. They are not the enemy.

3. Lousy sales

Are you really doing everything you can to build sales for your client? If the issue is beyond the scope of your relationship, do you just blow it off with a “not my job”? Shame on you because YOU will get blamed regardless. So, try and fix the problem. Be aggressive. There’s no downside since you will be the scapegoat in any event. And BE SURE you are doing everything you can to build sales.

4. Sloppy with their money

This one is really important. Sloppiness erodes trust. Worse yet, if something appears shady that’s not good on any level. Stewardship of the client’s money is critical. For many clients their ad agency is their #1 corporate vendor in money pass through, particularly if you handle their media purchase. Your compensation might be a small fraction of the spending, but if you are not handling their budget carefully like it’s yours, your client will be unhappy (and you will be when they fire you)

5. Personnel turnover

If you’ve done a great job on relationship building, that’s great. But the flip side is that if the relationship is too tied into one person and that person goes away, the account can be vulnerable. So keep personnel turnover (of respected agency people) to a minimum. On the other hand, be sure to rotate off those which you know, fairly or not, are not respected in the client’s eyes.

Interesting that I did not include the quality of the work. Obviously it must be terrific, but with smart people and a good relationship I will assume the quality will be first rate.

Alas in my former life as an ad agency head I was guilty in some cases of reasons #2-5. If you run an ad agency, think about whether you are guilty too and if so, do something about it before it’s too late.

More Strumings


  1. Michael Drabenstott says:

    I always said there were three relatively easy but mandatory things to keep accounts. Fail in any one of them and the account was in jeopardy.
    1. Be friendly.
    2. Be responsive.
    3. Do at least a very good job with excellence being the everyday goal.

    These are the things that are in the agency’s control every day in every interaction.

  2. Al Martin says:

    Add superior attitude looking down their nose at the client, especially the junior clients. Also, weak strategy lacking insight and leading to uninspired creative work. All should be obvious but too often not.

    • Lonny Strum says:

      Looking down on clients is always foolish at any level. And junior folk grow up (and remember mistreatment). Wise thoughts, Al. Expect no less from you.

  3. Hugo Trux says:

    All good points! My fav is the big wigs show up to pitch the account, then only junior people work on it, and you never see the big guns again.

    • Lonny Strum says:

      Good point, Hugo. But I am OK with big wigs pitching account. That’s their job. However, big guns need to find a way to continue to be involved, even if not day to day

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