A coaching client asked for help as he develops retainer packages for his agency.
He noted that he’s comfortable with what deliverables to promise at each price point—since he can estimate the work involved—but said he was concerned about how to make guarantees to clients. He asked:
“How can my agency guarantee results if I don’t know the results we’ll get?”
“We don’t have enough experience to project the value of each package—to confidently say, for example, that 4 blogs a month will guarantee X in ROI and 8 blogs Y in ROI. This obviously makes the packages challenging to sell.”
That’s indeed challenging—because he was really dealing with five things: pricing model, retainer pricing, work scoping, activities vs. results, and results-projections.
Short version: If you can’t guarantee results, don’t guarantee results.
Most Agencies Don’t Promise Results
In my experience, most agencies don’t guarantee a specific result.
- Most agencies sell on a relative basis (“blogging 8X will likely get better results than 4X), rather than an absolute basis (“you’ll get a 3X ROI”). That is, they’re selling activities rather than results.
- When you start selling a new service, you don’t know how well it’ll work. I’m a fan of trying new things under a “Labs” framing (e.g., “YourAgencyName Labs”), where you tell the client you’re going to try something new for free or at reduced cost for [1-3] months. They have low expectations, and you can gather data. But you shouldn’t pre-guarantee something you’ve never done before.
- It’s especially difficult to guarantee something beyond your control. For instance, if the scope has you handling strategy but not implementation, you’re at the mercy of your client’s implementation work.
Be Careful About Offering Guarantees
For sure, many clients want guarantees. But be careful.
When a client insists on a guarantee, it may be a sign that they don’t understand how marketing works. Or they may be in such dire straits (e.g., their boss has said, “Grow sales or you’re fired”) that any mis-step by the agency will turn into a huge client service problem.
Earlier this month, I spoke with the owner of a $5M+ agency—one of his mantras is, “Avoid situations where something small for you is big for them.”
Cases Where Agencies DO Guarantee Results
When agencies do offer guarantees, what does that look like? Typically they’re doing data-oriented work (PPC, conversion optimization, data migration) or they have such a big safety margin that they couldn’t not hit the goal.
For instance, a client that does conversion rate optimization (CRO) promises clients they’ll increase conversion by 30% (e.g., from 0.5% to 0.65%) within a year because the agency knows they [almost] always accomplish way more than that.
You can also guarantee other things, too. Similar to how Zappos pays employees to walk away, agency Content Harmony offers to pay clients to stop working with them. It’s a novel approach—and one that builds client trust.
Don’t want to be on the hook for refunds? You can also guarantee things like your team’s response time to client emails—things you can control.
Question: Do you guarantee results at your agency?