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ALP 32: Referring prospects to other agencies when they’re not a good fit for you

Every agency comes across a potential client that simply isn’t a good fit. In a previous episode, Chip and Gini discussed how important it is to walk away from prospects and clients that don’t match up with the agency’s needs.

But how do you do that well?

On this show, Chip and Gini look at how you can effectively refer these prospects to other agencies in your network. They will share the experiences of other agency owners, as well as offering their own advice.

“One of the important things for a lot of agency owners to overcome is that too many agency owners view other agencies as their competitors. And as soon as they start thinking competitor, they think enemy. And that’s really not true,” explains Chip.

Gini shares how she used to think that way, but came around to seeing opportunities with other agencies. “[I thought] wait a second, we can all do work together. And if they don’t have the capacity, or it’s not the right client for them, and vice versa, we can certainly share the wealth.”


The following is a lightly edited automated transcript. Please listen to the audio to confirm accuracy.

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

GINI: and I’m Gini Dietrich.

CHIP: And we’re here to tell you how to politely say no. Because we’re very polite people, aren’t we, Gini?

GINI: We are very polite. Well, I’m polite anyway, I don’t know about you, but – actually I do know. Oh, right – I promised I wouldn’t make fun of you until July, I’m sorry.

CHIP: 19 seconds in and you you already can’t live up to it, you’re gonna be taking shots.

GINI: Can’t live up to it! All right, July.

CHIP: Yes. So obviously, from time to time, we have to say no to prospects. And that’s something that we’ve talked about in a previous episode, you know why it’s important to do so. But today, we’re going to talk about exactly how you do it. And we’re going to share some feedback that we got from – guess where?-

GINI: The Spin Sucks community, woo hoo!

CHIP: Because it is the place to be. And so, Gini, the feedback we got, I think was was really helpful. And hopefully, is folks listen, they’ll get some ideas to as to how they can politely say no to prospects while not burning bridges, because I think that’s really important as well.

GINI: Yeah. And I mean, I would say that the majority of people said, it’s pretty easy to say, you know, we’re not the right fit for you. But let me refer you to so and so. So, then that’s typically what we do, as well, as we, you know, we have three or four we’ll, we’ll recommend or refer to three or four. So they can make a decision. And it doesn’t make it look like we’re just favoring one agency. But we do have for sure, have a roster of people who we’ve worked with or know who have good reputations, or you know, our friends, of course, but that’s across the board, pretty much everybody said was, you know, we’re, we’re not the right fit for you. But let me make a referral for you. Or let me make a recommendation and whether or not they take that is up to them, but at least you’re you’re maintaining the relationship and not being like, no, sorry, you suck, we’re not working with you.

CHIP: Right. And it look, it’s it is, as we’ve discussed previously important to understand who you’re a good fit for, and only do work for those clients for whom you are a good fit. And so referring them off, hopefully actually gives them a better experience in the short term, and maybe they will be a fit for you somewhere down the road, you know, if this is a size thing or, or a service oriented thing, whatever they’re looking for, you know, there’s an opportunity for you to do business with that person down the road, if you’ve given them a good recommendation in the near term. But I think that brings us to, you know, in order to be able to do that, effectively, you need to be building a network of people that you can refer business to. So yes, so, how do you go about doing that? How do you have this list of folks that you can run? Obviously, you know, you’re famous as the founder of Spin Sucks. And so you probably just have people beating down your door. For the for the average agency owner, who doesn’t have that advantage, how should they be building their network for referrals?

GINI: Yeah, I think there’s a couple of ways you can do it. Certainly, industry organizations work. And some of my my best friends who run great agencies came from Counselors Academy, which is a PRSA subcommittee, subchapter, whatever they call it. And, you know, I’ve been a member of that for 12 years. And so I’ve made some really good friendships and relationships and and because of that, I know like, I know exactly what people do. So if somebody says, I need crisis, I know to send them to John Goldberg. If somebody says, I need somebody in Phoenix, I noticed on them to Abby Fink like, you know, from that perspective, but also just hiring freelancers, myself, typically, there’s it we they may be too small for us. And so we’re able to say, here’s a boutique firm, or here, here’s here are four or five freelancers that you can talk to. And because I’ve worked with some of them just for our own agency, I I know their quality of work, I know what kinds of results they get, I know how how easy or hard they are to work with. So that but yeah, of course, the Spin Sucks community has been gigantic in growing that and I think, if you’re part of it, whether or not it’s the Spin Sucks community, if you’re part of a Facebook group, or another type of Slack community, or whatever happens to be, you can network that way to to find the right people, or even just post in there, hey, I had a prospect call and they’re looking for XYZ, does anybody fit the bill?

CHIP: And I think one of the important things for a lot of agency owners to overcome here is that too many agency owners view other agencies as their competitors. And as soon as they start thinking competitor, they think almost enemy, right? And that’s, that’s really not true. So first of all, most agencies have at most, a very small handful of people they go up against regularly more often than not, it just it varies by the individual project. Of course, it depends on what your particular specialty is, what your vertical is that you’re working with. But, you know, it’s not the whole universe of other agencies out there. So don’t view them as the enemy. View them as I like to term Co-opetition. Right? So..

GINI: I like it. Competimates, I call it, yep. Cooperative networks.

CHIP: Yeah, there. Yep. Exactly. There’s opportunities to work together. And, look, there are times where you will be competitive with them, if you’re fighting for the business of a particular prospect. But, you know, so first, you overcome that, and then, you know, start talking to them start having conversations, most agency owners love talking to other agency owners at the end of the day, because they learn things, and particularly if you’re open to that conversation, you will pick up so much. In fact, I was just talking with an agency owner earlier today, who was approached about merging with a slightly larger agency. And I said, Well, you know, take advantage of it one way or the other to learn about that business, because you can learn a lot that may help you down the road by just having open and honest conversation about how they do business, how they are profitable, you know, what, what, what their view of the world is, and it may cause you to think better. So all of those things will help you build your network so that you have people that you can refer those prospects to when you say no. And and the other thing is, if you start referring business to them, they’ll probably start returning the favor.

GINI: That’s how that works! Amazing, isn’t it?

CHIP: It really is. And, you know, people will often sit there and say, Well, you know, why am I just keep sending business to so and so? Well, when they find someone that you’re a better fit for? Chances are they’re going to send them in your direction. And so you really want to build this network of other agencies that you can mutually refer business to, because it’s in everybody’s interest to have a good fit between the client and the agency.

GINI: Absolutely. And you’re absolutely right, in that, they will, they’ll remember that and they will start referring business to you as well. I will never forget, as long as I live, it was probably 2011. The first time we got a referral from somebody who we considered a direct competitor. Because we were in the franchise industry, we’re working significant amounts in the franchise industry. And there’s only three agencies who do a lot of work in the franchise industry. And they were one of our direct competitors. And they referred the business to us. And I’ll never forget that feeling of Oh, wow. And because of that, it changed my mindset, exactly, to your point earlier around the fact that Wait a second, we can all do work together. And if they don’t have the capacity, or it’s not the right client for them, and vice versa, we can certainly share the wealth.

CHIP: And there are all sorts of reasons why someone may be a good fit for you and not for the other agency. And so, I mean, frankly, sometimes it just comes down to personalities. Yeah, some people may love my charming personality, and find you just wait too abrasive, Gini. You know, I, I can’t understand it myself, but I suppose it could happen.

GINI: Absolutely, it could happen.

CHIP: And so, you know, if you’re, if you’re building these relationships, you can make sure that you have those fits. And I would also encourage, when you make that referral, you say no, this isn’t a good fit for us. When you make that referral, explain why you think each of those people might be a good fit. So and it’s probably different, you’ve got three people that you say you might want to talk to, you might say, you know, John is an expert in this industry, Sally really gets the kind of work that you are looking for. And, you know, Brian, I think you’ll just love his personality, you know, whatever it is, you make sure that you’re you’re adding context and color to those referrals, because it will build the confidence of the the person that you’re saying no to when you explain why it is that you think they might be good fits.

GINI: And I also think there’s I mean, set aside the good karma of it all. There have been opportunities as well, where the prospect has come back and said, You know, it may be two or three years later and said, hey, we’ve actually outgrown, outgrown the agency that you referred us to. And thank you for that. We think we’re we’re ready for you now, what do you think? And then, because you’ve referred the business, you can have a really frank conversation with that agency owner to see what kind of client they were and whether or not whether or not they’re a good fit. And like all those kinds of things, you can get sort of that inside baseball, that you wouldn’t be able to get otherwise. And then you can decide if that’s somebody if it’s an ideal client for you now or not?

CHIP: Absolutely. And I think, you know, part of this, too, and part of the way you build your network and find these referrals is by playing nice in the sandbox. Yeah. And so and this is something that, that a lot of agencies, frankly, are not good at, you know, when you when you have a client that’s working with multiple agencies, maybe in different spaces, there’s often the inclination, particularly larger agencies like to try to scoop up as much of the total businesses they can. So they, they don’t play nice in the sandbox, they go and they sit there and they try to figure out, Okay, how can I expand my piece of the pie, probably at the expense of one of these other agencies there. And, you know, I’ve

the client and with the other agencies, first of all, the client will like you much better, because the, the client is sort of like a parent here, they don’t really want someone coming in tattling to them, they just want everybody to be doing what they’re supposed to do. Yes, but but secondly, you’ll build better relationships with those other agencies, because I can tell you, when I’ve worked in large agencies, and we’ve been partnered up with agencies that we know who don’t play nice in the sandbox, we’re always really careful around them, we’re always walking on eggshells and trying to make sure that, you know, that’s not productive, that’s not helpful, that doesn’t get good results for anybody, right. And so if you’re that the person who acts nicely, that plays nice in the sandbox, the client will trust you more, you’ll probably grow your piece of the pie simply because of that. Right? Because they want to work with you, the other agencies will be willing to work with you on other things, which means they’re more likely to refer business I mean, think about who refers business to someone they they don’t like and think isn’t going to behave well, right there. It just doesn’t happen. So find these ways in order to, to cooperate because it will build your overall network and build your business over time.

GINI: Yeah, so I think the moral of the story is you don’t have to take every piece of business and you don’t have to feel weird about saying no, there are easy ways to do it. Now on the flip side of that, though, is if it’s somebody that you can tell would be a terrible client, because they’re not a nice person. And you don’t want to refer them to anybody, unless you have true agency owner enemies. And then you think that’s kind of funny. But so how do you handle that side of things? Like when you know, they’d actually be a really toxic, toxic abusive client for an agency?

CHIP: What and, and, yeah, and and that is really tricky, because you know, those that, you know, we’ve all dealt with prospects or clients over the years that you wouldn’t wish on your worst enemy. It’s just, it’s reality. At the same time, you know, I’m always mindful of the fact that just because a client relationship didn’t work out for me, it might work out for somebody else. It might be for all for all I know, it’s because of the way I do business or person. Yeah. But, you know, it’s

GINI: Maybe the person is just really terrible. And you shouldn’t shouldn’t be working that shouldn’t be running an agency anyway, managing an agency anyway.

CHIP: Possibly, but you know, but do you but is it? Is it because that person is terrible that they acted terribly with you? Or is it something else about the dynamic, you, you remind them of, you know, a long lost enemy, or, you know, who knows that? You know, we and we’ve all had that – I mean – I’m sure that we all have friends that that we’re very friendly with and other people, I cannot stand that person, be around them. So so I’m always mindful of that.

GINI: You also know, with with friends like that, they may not bother you, but you also know that they rub most people the wrong way. Yes. Yeah, absolutely. So then again you want to refer them off.

CHIP: Yeah, although my approach, and in those cases usually would be that if I think there’s someone who could do a good job for them – but you know, but for the fact that they might not want to, I will often make the referral. But I’ll talk to that person, that other agency owner and say, Look, you know, here’s, here’s been my experience with this individual, or here’s what I know, you know, so that to give them some background, and so you know, if I know that it’s a client who’s, you know, particularly needy, or if I know, it’s someone who’s got a really strong personality in a particular direction, that may rub people the wrong way, I will give them what information I have, so that they’re aware of it, and then they can make their own decision. I mean, we’re all big boys and girls. And, you know, for one reason or another, someone may say, look, you know, I’m willing to put up with this, you know, I think they, they they have the you have an obligation to them to share what information you have if it’s essential to their decision making, so that you don’t make them feel like they got snookered by you. But at the same time, you know, it’s up to them to be able to make their own decisions about which client relationships they want or don’t want.

GINI: Absolutely. Yeah, I mean, it’s, you definitely don’t want to make the decision for them. But I like the idea of we actually had a client who we, I wouldn’t say fired, it was more amicable than that, but we definitely pushed on their way. And I referred them to two agencies and had a conversation with both owners to say, this was our experience, this is what you can expect, you decide. But yeah, we didn’t make that decision for them, we let them let them make the decision.

CHIP: Right, and it may just come down to you know that they just need to establish the right expectations or guardrails or set the pricing differently. So it may be that the relationship could work, if they made some adjustments that you know, that you hadn’t, or couldn’t, for whatever reason. So, you know, sometimes I will tell someone, you know, this is this is a client that that, you know, in my experience tends to go well beyond the scope of work. So, you know, then that that client can build in sort of a contingency budget, if you will, into their pricing so that they can figure out this is this is how I need to be able to do it in order to manage this client effectively and profitably, whatever information you’re giving could be helpful to them and just setting the relationship up better from the start. So in which case, it could well work out for them where it didn’t work out for you. But sometimes, you know,

GINI: I’m just gonna send you all my problems. After June, after June.

CHIP: That’s why I’m, that’s why I’m out of the agency business. I like to advise owners on what to do rather than …but you know, and just listeners understand the magic to June here, just because this is sounding a little bit weird. Now that we’ve mentioned this a couple times. It’s because I umpire baseball, and I was complaining about how I keep getting yelled at by coaches and teenagers when I’m umpiring baseball game. So I asked for liberty from non baseball critiques until July. So just so you understand why we keep referring to this.

GINI: Why I can’t make fun of you until July. Yes. I’m going to put an alert in my calendar so I’m ready.

CHIP: Yeah, you Well, you’re not doing a very good job so far. So. So I’m not sure there’s a need to put it on the calendar.

GINI: It could be worse, though, it could be worse.

CHIP: Fair point, fair point. And it could be worse for any agency as well. So, you know, and I think that’s why it is important not to be making decisions for other people. Because I – there may be, there may be a lemon to be made out of the lemonade somewhere else.

GINI: Yeah, absolutely. I think I think the more the real moral of the story here is, karma is karma. And when you when you put good karma out into the world, that comes back to you tenfold. And that was pretty much the genesis of the conversation, and everybody was in in agreement, there was some jabbing about Canadians and how polite they are, even when the client is not polite. So there was a little bit of jabbing from that perspective, but I think the general consensus was Yeah, I mean, you’re not you doesn’t sound like you’re the right fit for us. But let me introduce you to so and so. so and so and so and so.

CHIP: Right, and I think your other podcast co host or one of the other ones, Joe Thornley had a had a good point. And that is in the particular case, where you’re saying no, because of a conflict. In those cases, it’s best to be short, sweet, and get out as quickly as possible. Right.

GINI: Yeah. Yes.

CHIP: And but that’s, that’s something that I think it’s important for owners to be thinking about. Because, you know, particularly if you haven’t worked in a larger agency environment, where conflicts tend to be, you know, more common and things you have to deal with, you know, if you’re a small to mid sized agency owner, you may not be dealing with conflicts all that often. But it is important to think about them and understand, okay, when I’m talking to a prospect, how are my current clients going to perceive this, and you don’t want to be in a situation where either that prospect feels like you took advantage of them by, you know, peeling information away, that you may be able to use competitively with your other client, right? And you don’t want your other client to feel like, you know, hey, you’re cheating on them with a direct competitor. So, you know, make sure that when you’re talking to a potential client, you think about how it might create conflicts with other clients and just be sensitive. That doesn’t mean you have to say no, in all cases, I think, frankly, people are, once they think about it, they often overthink it. And they they find more conflicts than they really need to. But if you’re certain if you’re working for Coke, and Pepsi calls you Okay, that’s an easy one, right? There’s no need to be thinking about it, you know, that’s a bad one. And so you want to, but you want to make sure that nobody feels like, you know, they, they were hoodwinked in that process. So in those cases, Joe’s absolutely right, make sure that you just disengage quickly, don’t share any info. And and and he says, Don’t even make a referral. I, you know, I I’m sort of 50/50 on that I’m not sure that there’s necessarily anything wrong with suggesting some other folks in those cases, it sort of depends on how you do it. You know, because “it depends” is indeed our motto it is. But the safest is to get out without sharing anything. But think about it at least.

GINI: Well, and that might be a good conversation for an upcoming podcast too because in we actually had this conversation, I have an agency jumpstart program for agency owners who are just starting out. And in our group coaching call a few weeks ago, we had the conversation about conflict. And when you’re an expert in an industry, like the music industry, for instance, or for us in the past the franchise industry, how do you manage having that expertise and knowing the right people and being network in and having the right relationships and you know, knowing who to pitch from a PR perspective and all that without, and being able to use that for clients, but having to do that without there being a conflict? So maybe that’s a good conversation for a future episode.

CHIP: Yeah, because I mean, I’ve worked in agencies where, where the, the agency has worked for two absolute direct competitors, very much similar to Coke and Pepsi. It was not Coke and Pepsi, but big companies that, you know, 99 out of 100, people would say, Oh, yeah, those are archenemies. And it turned out that while both clients acknowledge that there was the potential for conflict, what this particular agency did was, was valuable enough that they both felt they could work with them, as long as there were appropriate firewalls in place. Obviously, when you’re small firewalls are almost impossible. But, you know, but at a certain size you can get there. And I I guess my overall point there, and I do think it probably is, is good to go into this in more detail another episode, but, you know, don’t assume it’s a conflict, you know, you can often talk to the client, and they may say, Oh, no, that’s, you know, you’re, we’re fine if you work with so and so. Because, you know, while we’re perceived as competitors, you know, we serve the high end, they serve the low end, what, you know, there’s all sorts of different ways that they might be looking at it differently than you are.

GINI: Managing conflict, I’m writing it down for a future episode.

CHIP: There we go. Or, of course, you could just be like the big boys and create a whole conflict agency,

GINI: You could.

CHIP: And that’ll be something we’ll talk about in that episode. But not today, because we’re running up against our time limit. And, and, and we like to try to keep these short and sweet. So that you get maximum value in minimum time.

GINI: That was a good segue.

CHIP: Yes. All right. I have nothing else to offer on this. Say no to the wrong prospects say yes to the Agency Leadership Podcast. But with that, I’m Chip Griffin,

GINI: and I’m Gini Diedrich.

CHIP: And it depends.

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The Hosts

Chip Griffin is the founder of the Small Agency Growth Alliance (SAGA) where he helps PR & marketing agency owners build the businesses that they want to own. He brings more than two decades of experience as an agency executive and entrepreneur to share the wisdom of his success and lessons of his failures. Follow him on Twitter at @ChipGriffin.


Gini Dietrich is the founder and CEO of Arment Dietrich, an integrated marketing communications firm. She is the author of Spin Sucks, the lead blogger at Spin Sucks, and the host of Spin Sucks the podcast. She also is co-author of Marketing in the Round and co-host of Inside PR. Follow her on Twitter at @GiniDietrich.

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