An interesting situation arose for one of my clients recently. I’d like to share it with you as it raised a few points about how to manage a conflict where you want to work with your clients’ competitors.
The problem goes like this:
- A key competitor to one of the agency’s long-standing clients offered a high-value contract plus the opportunity for them to be more adventurous and ambitious with their marketing programme. The only condition was exclusivity against its biggest rival.
- The offer prompted the agency to talk to its existing client. It responded by saying it didn’t mind the rival contract and could also increase the value of its work with the agency to match the offer made by its competitor. Plus it pledged more attention from senior management on the marketing projects in the mix – a flattering development.
So that’s the quandary.
- Does the agency leave its incumbent client for the promise of a more ambitious marketing programme?
- Does it remain loyal to its existing client, which has now engaged with them at a deeper and more meaningful level?
- Does it try and work with both and set up a conflict brand – and put at risk both relationships?
What would you do?
In this case, the agency was too small to create a true conflict-free brand. Realistically the principal was too heavily involved across the business for that to be an option.
We also decided that it was worth going back to the competitor to explain the situation with the incumbent: that they were fine with the agency working with them and had wanted to engage on an increased budget because they valued them so much. Was there a scenario, they asked, that would still allow the agency to work with them?
It seemed like a limiting mindset just to decide internally that it was impossible to work with both brands. So it was worth at least asking the question, in a humble way, about a dual-client approach. It also conveyed to the competitor that the agency was in demand.
We’ll see what comes back from the competitor and what my client finally decides in due course. But what can we learn from this encounter in the meantime?
- You need to be open and above board at all times. You’ll get respect for that from all sides.
- Setting up a ‘conflict shop’ with Chinese walls or with physical separation isn’t an option for all agencies, but there may be degrees of separation that clients are happy with – so try the less difficult routes first, like setting up separate teams.
- When growing your agency, consider how you deal with conflict generally. Of course, every situation is slightly different but a stance like ‘as experts we work with all good brands in the sector' could be the right message and mimics the approach that the consultancies have been taking for years.
Partner at Waypoint Partners
Waypoint Partners are a leading growth advisory firm, working with shareholders and their leadership teams in the creative, marketing and technology sectors to grow and realise value. Are you planning for agency growth in the next 1-3 years? We would be happy to help you achieve your growth targets. Please feel free to give us a call on T +44 (0) 203 282 7598 or send us an email via email@example.com. We look forward to starting the conversation.
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