How to Avoid Problem Clients(nicholasreese.com)
nicholasreese.com
How to Avoid Problem Clients
http://www.nicholasreese.com/problem-clients/?utm_source=getresponse&utm_medium=email&utm_campaign=downloads&utm_content=How+to+Avoid+Problem+Clients
10 comments
I'm having trouble getting past the fact that this guy was, basically, running a spam business. Email marketing is spam, to a first approximation, and while there are ethical email marketers out there, I don't know enough to be sure that this guy was one of them. Which means I'm getting good advice from someone whose ethics are under a cloud; it colours my view of the whole article.
ETFB --
Hey man, author here.
I'll admit, starting out (back in 2006) the business was a little shady with regards to can-spam, but for the specific MLS area my business served, it was the norm for realtors to send eblasts to each other. (the MLS sold the email list on the basis of "prior business relationship" because all the realtors were apart of the same area board.)
That said, in 2007 I sent out a double optin request, and nuked my list from ~40K to ~5k to really make sure things were above board.
This crushed my business, so I spent ~$15k in Adwords building a double opt-in list of customers that wanted email updates about luxury properties.
That was the REAL value and how I was able to scale the business past 6 figures and sell it in 2010.
I appreciate your concern even though I despise ad hominem arguments. ;)
Hey man, author here.
I'll admit, starting out (back in 2006) the business was a little shady with regards to can-spam, but for the specific MLS area my business served, it was the norm for realtors to send eblasts to each other. (the MLS sold the email list on the basis of "prior business relationship" because all the realtors were apart of the same area board.)
That said, in 2007 I sent out a double optin request, and nuked my list from ~40K to ~5k to really make sure things were above board.
This crushed my business, so I spent ~$15k in Adwords building a double opt-in list of customers that wanted email updates about luxury properties.
That was the REAL value and how I was able to scale the business past 6 figures and sell it in 2010.
I appreciate your concern even though I despise ad hominem arguments. ;)
Reply to all but the last clause of the last sentence: good for you! I was going to add to my original comment that nothing else about your site felt shady or unethical, so the chances were very good that you were one of the non-shonky email marketers. I've got a couple of your other pages open in tabs now because I suspect you have some good advice for me. I'm please to have it confirmed that you considered those issues of ethics and put your money where your mouth is.
Reply to the final clause: to be employing an ad hominem argument I'd need to be bringing up something about you that's irrelevant: "I won't read an article by a guy with blond hair, because a blond guy once ate my cat" would be classic ad hominem. But I think your history as a (suspected) spammer is definitely relevant when the matter in question is your eligibility to give advice about customer relations, so I stand by it as valid, and not ad hominem. And on the flipside, your explanation of where you went with your pseudo-spamming career makes your articles more credible, don't you agree? It works both ways, which an ad hominem argument doesn't.
Reply to the final clause: to be employing an ad hominem argument I'd need to be bringing up something about you that's irrelevant: "I won't read an article by a guy with blond hair, because a blond guy once ate my cat" would be classic ad hominem. But I think your history as a (suspected) spammer is definitely relevant when the matter in question is your eligibility to give advice about customer relations, so I stand by it as valid, and not ad hominem. And on the flipside, your explanation of where you went with your pseudo-spamming career makes your articles more credible, don't you agree? It works both ways, which an ad hominem argument doesn't.
Why do you say that "email marketing is spam"? I get email from marketers that I would miss if it was gone.
Only to a first approximation. The exceptions are increasing as more people realise that ethics and marketing are not incompatible. But I believe it's reasonable to be suspicious of email marketing by default, and look for reasons to be forgiving, rather than the other way round.
I wanted more customers who were focused on results, instead of price.
... and also trust you to provide the right solution. Good clients tend to know what the want at a high level and trust you to take care of the rest. Problem clients tend to micro-manage and are looking more for a robot. Usually those projects are unsuccessful for the same reason telling a heart surgeon how to perform surgery is disastrous.
... and also trust you to provide the right solution. Good clients tend to know what the want at a high level and trust you to take care of the rest. Problem clients tend to micro-manage and are looking more for a robot. Usually those projects are unsuccessful for the same reason telling a heart surgeon how to perform surgery is disastrous.
Don't oversell what you can offer. It's amazing how perfectly reasonable customers become "problem clients" when you can't deliver what they bought.
Indeed. I'm currently working for a company that won a major contract based on products we hadn't built but thought we could if the client asked. Add senior management who have their focus on another product and this makes for an unhappy client and an unhappy place to work.
I agree with setting high prices.
Back when i was selling realtime data backup software I was wondering how come the highest priced package pulled the biggest total number of sales. Today I realize i should of set price 10x more and I'd probably sell more.
I also recommend attitude "there are no problematic clients" vs "how to avoid something". Quite often in my experience the "problematic" and complaining client suddenly spent large amount of money on order.
Back when i was selling realtime data backup software I was wondering how come the highest priced package pulled the biggest total number of sales. Today I realize i should of set price 10x more and I'd probably sell more.
I also recommend attitude "there are no problematic clients" vs "how to avoid something". Quite often in my experience the "problematic" and complaining client suddenly spent large amount of money on order.
One of the best pieces of advice I've ever heard "The client isn't problematic, you're just not charging enough to make it feel worthwhile."
Setting your prices high is alleviating the symptoms without understanding the root cause.
Most companies get troublesome clients because they’ve miscommunicated their value preposition and didn’t set out clear rules that govern their business relationship.
People tend to believe in the same fallacy about employees by saying you have to hire the absolute best. I think it’s a sign of laziness of management who rely on their employees to know what they’re supposed to do without every being clearly explained what you want them to do. When you make your expectations explicit, most people raise up to the challenge and perform beyond wildest imaginations.
Unfortunately, that’s hard work on your (employer’s part).
We’ve taken the same approach to qualifying clients—there are certain criteria that we look for and certain rules that we make expressly clear to every client before they agree to work with us. These have absolutely nothing to do with the depth of your wallet and yet, we get absolutely delightful clients time after time.
Most companies get troublesome clients because they’ve miscommunicated their value preposition and didn’t set out clear rules that govern their business relationship.
People tend to believe in the same fallacy about employees by saying you have to hire the absolute best. I think it’s a sign of laziness of management who rely on their employees to know what they’re supposed to do without every being clearly explained what you want them to do. When you make your expectations explicit, most people raise up to the challenge and perform beyond wildest imaginations.
Unfortunately, that’s hard work on your (employer’s part).
We’ve taken the same approach to qualifying clients—there are certain criteria that we look for and certain rules that we make expressly clear to every client before they agree to work with us. These have absolutely nothing to do with the depth of your wallet and yet, we get absolutely delightful clients time after time.
Great article.
I don't agree that you should focus on anything less than the "Give me results" clients. First off, you know what they say is the problem with goals? You'll probably reach them. Meaning, you're setting your ceiling. I've found that if you hand pick your clients, you can make certain that you have clients who focus on results. Most consultants talk about word of mouth as the main way that they get new clients, but I dislike that approach. The reason is that you're letting clients choose you. My best client is a client that I picked and cold called. I knew they were making lots of money and I knew they needed what I was selling. Selling something as a consultant is about specialization. Specialization doesn't necessarily mean that your experience is focused in one area. It means that you can present yourself as an expert in one area.
Here's something counterintuitive that I've found that goes along with this article: Clients who pay the least are usually the most demanding. I used to lower my price when people complained, but I quickly realized that my price was a filter blocking bad clients. Plus accepting a lower price really led to likely bad outcomes because when the going got tough, the voice in the back of my head said, "These guys are paying you less than your other jobs", then I suddenly felt completely unmotivated to work hard for them.
Here's a really good book about consulting that helped me. Not focused on software consulting, but a lot of the concepts are the same: http://www.amazon.com/Million-Dollar-Consulting-Alan-Weiss/d...
I don't agree that you should focus on anything less than the "Give me results" clients. First off, you know what they say is the problem with goals? You'll probably reach them. Meaning, you're setting your ceiling. I've found that if you hand pick your clients, you can make certain that you have clients who focus on results. Most consultants talk about word of mouth as the main way that they get new clients, but I dislike that approach. The reason is that you're letting clients choose you. My best client is a client that I picked and cold called. I knew they were making lots of money and I knew they needed what I was selling. Selling something as a consultant is about specialization. Specialization doesn't necessarily mean that your experience is focused in one area. It means that you can present yourself as an expert in one area.
Here's something counterintuitive that I've found that goes along with this article: Clients who pay the least are usually the most demanding. I used to lower my price when people complained, but I quickly realized that my price was a filter blocking bad clients. Plus accepting a lower price really led to likely bad outcomes because when the going got tough, the voice in the back of my head said, "These guys are paying you less than your other jobs", then I suddenly felt completely unmotivated to work hard for them.
Here's a really good book about consulting that helped me. Not focused on software consulting, but a lot of the concepts are the same: http://www.amazon.com/Million-Dollar-Consulting-Alan-Weiss/d...
I would add only a single thing to this list: make sure to do your due diligence on potential clients. Look them up and see who they are before you accept work with them.
The other point of clients is not that they're inherently good or bad, but that handling them determines the dynamic of the relationship. If a consultant appears eager and willing to do something for nothing, they can't blame the client. Never offer something that would lead to resentment; say "no" instead.
On the otherside, the value of hot to crazy (money to bullshit) has to be there.
On the otherside, the value of hot to crazy (money to bullshit) has to be there.
There's an excellent book that goes into depth around this subject: Implementing Value Pricing by Ronald J Baker. Highly recommend it to any business owner who deals with clients.
In business, the simple way to get rid of problem customers and maybe to avoid taking them on in the first place, is to ensure you have per customer pricing and agreements. For example, client A is a good customer, so a support ticket for them costs just $150, but client B is a right royal pain in the backside and so their support ticket cost is $550. Similar scaling for development etc. Keep raising prices till they go or stop calling so much, as required.