Want to improve client retention? Adopt two powerful words…

Written by: Karl Sakas

The ideal business strategy fits on a bumper sticker or a T-shirt. Why? Because your team is more likely to follow a strategy that’s easy-to-remember, versus a 20-page plan.

If you want to improve client retention at your agency, try a simple yet powerful business strategy: Warmth & Competence.

The concept (from the book The HUMAN Brand) helps explain how agencies can have better client relationships—in particular, what they should strive for in working with clients.

Consider the power of the upsell—it’s easier to get more money from existing clients than totally new clients. But for upselling to work, clients need to be getting results—agency Competence—and enjoy working with you—agency Warmth.

You can learn more about Warmth & Competence in The HUMAN Brand, by Chris Malone—former CMO at Aramark and Choice Hotels—and Princeton psychology professor Susan T. Fiske.

Warmth & Competence: Four Combinations

In their research, Chris and Susan found that people evaluate people and brands on two axes: Warmth & Competence. Companies can be high or low Competence, and high or low Warmth.

For instance, if you go to the DMV, you may find the employees are moderately Competent but low on Warmth. In contrast, when I go to my local post office, I’ve found the employees are friendly, helpful, and apologetic—that is, high Warmth—but they’re typically apologizing because basic services have yet again gone awry—that is, low Competence.

Goldman Sachs or Bank of America might be seen as high Competence—they’re good at what they do—but low Warmth—no one really enjoys dealing with either company. They’re aloof.

Brands like Apple, Starbucks, and Southwest are known for being high Warmth and high Competence. They’re good at what they do, and people enjoy interacting with them. The brands have extremely loyal customers.

You Need High Competence AND High Warmth for Better Client Retention

What’s the takeaway for digital marketing agencies like yours? Strive for high Warmth and high Competence in your client service experience.

It’s not enough to just be good at what you do; people have to enjoy working with you, too. For instance, I see agencies do well at competence (e.g., getting deliverables done on time) but then poorly at warmth (e.g., they keep embarrassing their client contact in meetings). Clients tend to remember the relationship mistakes before they remember the marketing mistakes.

Want to improve client onboarding and the rest of your client experience? Read The HUMAN Brand and adopt Warmth & Competence as your agency’s client retention strategy—and consider spreading Warmth & Competence to your management style, too. Warmth & Competence can help you employee retention, too!

Question: Have you applied “Warmth & Competence” at your agency? How did you see it impact client retention?

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