The ugly truth about digital marketing contracts is that they are one-sided affairs.
Your business needs may evolve. The macroeconomic situation may shift. Buyer tendencies and sensibilities may change.
But meanwhile, your marketing contract is supposed to remain static? It just doesn’t make sense.
So much so, that we’d call it a fundamentally flawed approach to partnering with clients.
It’s A Matter of Trust
Before we cover why contracts are a suboptimal approach to marketing partnership, let’s explore why they are leveraged in the first place.
I believe the wide-scale usage of long-term contacts comes down to a lack of trust.
Clients are wary to trust a new agency partner, and vice versa. And both sides have legitimate cause for concern.
Why Business Owners Are Hesitant to Trust Digital Marketers
Far too often, the first thing we hear from business owners during discovery calls is that they’ve had a “bad experience” with digital marketing in the past. I’ve written more about common bad experiences with digital marketing agencies, be sure to check that out if you’re curious.
What’s worse, is that even if the business owner hasn’t had a bad experience themselves, they’ve likely heard from at least one professional in their circle who has. The unfortunate truth is that our industry (for a multitude of reasons) is full of fly-by-***** practitioners and corner-cutting organizations. It’s therefore quite hard to find a good digital marketing agency.
Why Marketing Agencies Are Hesitant to Trust New Clients
On the flip side, most agencies have also had bad experiences in the past. No matter how good a job you do, there will always be an unreasonable customer or client that can throw a spanner in the works.
We have certainly been “burned” in the past.
Occasionally a client will argue for bottom dollar pricing, push for scope creep immediately, and then exit our partnership as soon as they feel they’ve extracted maximum value from our dedicated and hard-working team.
Sometimes as well, we will be well into the execution of an agreed upon strategy, and have the plug pulled on a partnership because results were not forthcoming fast enough. Sometimes this can be in as little as 30 days, which is simply not long enough to see results from digital marketing.
I have no doubt other agencies have had similar experiences. So on the surface, I can see why they turn to long-term contracts to protect themselves from the above scenarios.
The “Advantages” of Contracts
Don’t get me wrong, there are certainly some benefits to long-term digital marketing contracts. The problem is that not a single one of those benefits is to the client’s advantage.
Literally all of them empower the agency alone.
For instance, a long-term digital marketing contract with a new client would:
- Ensure the agency is allowed sufficient time to generate results for clients. Digital marketing results are very rarely achieved overnight.
- Provide a higher degree of certainty that once the agency does start generating results, they won’t get axed under the mistaken assumption that all of the work has already been done and they can cut expenses. Read more about that here.
- Create more reliable and predictable cash flow for the agency.
As I mentioned above, these benefits all favor the agency exclusively. There is no benefit to our clients whatsoever.
That’s what fundamentally bothers us.
We’re in this business because we want to help business owners grow and succeed. What sense does it make to have a core part of our relationships with those business owners be so one-sided in our favor?
Furthermore, there are all kinds of undesirable but realistic factors that can come into play despite everyone’s best efforts. These factors can absolutely make a shift in investment, strategy, or even a complete cessation of partnership the most appropriate action for the client or the agency themselves to take.
With all of that in mind, it’s hard for us to consider long-term contracts to be anything but a flawed, one-sided, and short-sighted adjustment to some very real trust issues. Short-sighted because the contract doesn’t actually address the root cause of the problem.
So, you must be wondering: “In RankPay’s opinion, what does address the root cause of the problem?”
The answer: Clear and honest communication. Realistic expectations. And sometimes saying “no”!
Honesty, Realistic Expectations, & The Power of “No”
We believe the answer to solving trust issues is to tackle them head on.
Honest communication on both sides of the equation lead to better outcomes, longer-lasting partnerships, and positive experiences.
Sometimes after a discovery call, either the client, the agency, or both should recognize that there isn’t a good fit. Perhaps the services the agency provides don’t seem promising in the client’s market. Or perhaps the client’s expectations are unrealistic and the agency wasn’t able to successfully educate them about what they can reasonably hope for.
Either way, saying “no” can save both parties a whole lot of time, energy, and money.
But that requires that both parties participate in honest dialogue.
Remember those “reasons agencies turn to contracts” from earlier in the article? In case you’re curious, let’s take a quick look at how the simple solutions mentioned above address all of those challenges.
- Instead of forcing a client to give us enough time to get results via contract, we simply ask for it. It’s a remarkably simple and incredibly powerful idea. By setting realistic expectations, everyone will be on the same page, on day 1.
- Instead of obligating a client to stick with us long-term, we explain early on that once results start rolling in, it’s definitely not the right time to sit back and relax. We strive to educate our clients about the following reality: the businesses succeeding online are the ones making long-term commitments to strategy, adaptation, and smart execution.
- Instead of securing our cash flow and client-base through paper obligations, we focus on building lasting and flexible relationships with clients. We also communicate clearly and openly that we are a for profit organization, that only wins when our clients win. We depend on clients for support and partnership as much as they do on our skills to help them grow the online side of their businesses.
Hopefully now you can see that honest dialogue and a trust-forming approach can actually solve all of the root problems that lead agencies to lock clients into long-term contracts.
Before we close out on the topic, let’s look at a few examples of this practice in action.
Example A
Prospective Client: “I need to see a clear CPA and significant organic traffic growth in 30 days.”
Typical Agency: “No problem, we can definitely do that.”
The Issue: This is a highly unlikely outcome. Unless there is a notable and successful organic traffic baseline, and all measurement protocols are correctly in place, this type of goal will not typically be achieved in 30 days.
The Solution: Answer the question honestly and set realistic expectations. “We can certainly build a strategy based around establishing a CPA and building organic traffic, but the issue we’re going to run into is your timeline. Let me try to explain why that’s most likely not feasible…”
Example B
Prospective Client: “I need to rank #1 on a few important keywords for my startup business. I don’t want to do content, or work on my website at all. How much should I spend on SEO?”
Typical Agency: “Well, if we go with a platinum link package, we would charge $1,250 per month. I think that would be a great fit for you since the site is new.”
The Issue: Search optimization is more holistic now than ever before. It is extremely unlikely (to the point of being improbable) that links are going to be “the answer” to get this startup business indexing well with Google.
The Solution: Educate the client that they are looking at the solution through the wrong lens. “For newer websites, and especially startups, SEO is often going to be a long-term move. Our concern is that you’re opposed to website work and/or content marketing. Those are vital components to *most* SEO strategies these days, and likely shouldn’t be ignored. We can learn more in an audit, but in all likelihood we will come back to you with a comprehensive strategy, as opposed to a plug-n-play SEO solution.”
The key here is that we are not sales people. We are educators.
It is our responsibility to help clients understand digital marketing. It’s our privilege to be mindful stewards of our client’s hard-earned marketing dollars. And lastly, it’s our duty to clearly inform them of what they can reasonably expect regarding timelines and ROI.
We believe that contracts are a crutch. A band-aid to avoid addressing the real root causes of mistrust between agencies and clients alike. And we hope that after reading the above, you’ll consider our approach in your next business partnership.
