How to spot red flags in agency prospecting, hiring, and more

Know what to look out for so you can avoid potential pitfalls
Agency Leadership Podcast

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Learning how to spot — and handle — red flags can make a big difference in your agency business. Knowing what to look for, what not to ignore, and what action to take can mean the difference between getting saddled with a difficult client, bad hire, or otherwise challenging situation.

Chip talks with Gini about an article she recently wrote for Spin Sucks that explored red flags in new business conversations. The co-hosts then looked at other situations that might generate red flags and offered some practical advice for agency leaders in addressing them.

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Transcript

The following is a computer-generated transcript. Please listen to the audio to confirm accuracy.

CHIP: Hello, and welcome to another episode of the Agency Leadership Podcast. I’m Chip Griffin.

GINI: And I’m Gini Dietrich.

CHIP: And I’m sorry, I was distracted there because Gini was like dancing,

GINI: dancing in my chair.

CHIP: It was it was a little disconcerting. Those of you who are listening, have no idea what I’m talking about. Because, again, no video, and we’re not going to start

GINI: well, and I wouldn’t be dancing in my chair, if we were going to be on video for everybody. So it’s only for your entertainment.

CHIP: Well, I’m not sure how to will simply move on. And perhaps perhaps I might see that as a red flag,

GINI: maybe it is a red flag, which is what we are going to talk about today. So I wrote about on spin sucks, red flags and how to notice them and in any situation, not just client relationships, but you know, if you’re interviewing for a new job or looking for a promotion, or whatever happens to be but for this purpose, we’ll talk about red flags with prospects or existing clients and what to do about that. them. And somebody commented on the Instagram post that we did on it that he needed to hear it. And I was like, Yeah, me too, which is why I wrote it. Because I’m not always so good at it. And I see red flags, and I’m like, Oh, I’m sure it’ll be fine. And then I ignore it. And then it’s not fine. So, yeah, I wrote that just as much for me as for everyone else.

CHIP: Here’s the problem as entrepreneurs, we all believe that we are so good that we can overcome those red flags there. And so you know, we sit there and or at least I know I do. I won’t speak for you, Jenny. But I sit there and I look at a problem like, I can solve that. Yeah, I know. Other people have gone before me and tried to solve this and they didn’t know why. I can do it. They just don’t be me, wasn’t me. I have to tell you, most of the time, I’m not nearly as good as I think I am. And if several others have failed before me. The odds are

GINI: probably a pretty good sign. Yes, pretty

CHIP: good science. I need to pay more attention to red flags too.

GINI: Yeah, I think it’s a well, it’s an innate human thing. But also, I mean, there have been movies written or made and books written about fiction books written about this, because we think that we can fix things. And we cannot, in most cases,

CHIP: yeah. And and in the agency space, there’s the added level of nervousness over the traditional feast or famine cycles. And so you know, you you have an opportunity to work with a client or you have an existing client, and they’ve got red flags all over the place, and yet you’re like, wow, but with their check clear, because the only red flags I’m worried about are their checklist. I’ve seen agencies who don’t ignore even that red flag, and and then are surprised when the money doesn’t actually hit their accounts. And yeah, that’s not good.

GINI: Yeah. So my favorite, what are some of these red flags? Well, my favorite story to tell in this instance, is we had a client who actually was a friend of mine. He was a fellow Vistage member. I knew him for a long time. It was his second business. It wasn’t, you know, it wasn’t like he was some stranger to starting a business and, and he had sold his first business for a lot of money. And he asked if we would participate in a pitch. And I was like, you know, we don’t really do competitive pitches, if you want our expertise, great. If not, then you know, I’m just not gonna do it. And he was like, Oh, okay. And so he didn’t do a competitive pitch. He hired us. And I didn’t see any red flags until after he hired us because we didn’t go through the traditional, you know, I made a prospect. I asked questions all like myself. We didn’t go through that traditional thing in the very, very, very first meeting. He made his chief operating officer cry in front of us and my team. And then he turns to me and he said, Don’t f this up, except he actually said the word. Because if you do, I will ruin your reputation. And I was like, Oh, wow. Okay, and I will never forget. We left them Meeting, took the elevator down, walked out of the building. And our managing supervisor turned and looked at me and said, I’m not working on this account. And I was like, and it got progressively worse. I mean, he he paid us $30,000 a month. It was a lot of money, especially back then. And it was not worth a single penny. It was horrendous. And it that it was that then that I said, Okay, we have to figure out what does our ideal client look like? What kinds of red flags should we be looking for? And what kinds of questions do we need to ask to find them?

CHIP: Well, I mean, that that red flag, I mean, that feels like you must have had a darkening blindfold on in order to, I had no idea I’ve been in. I’ve been in plenty of meetings with prospects or clients where I’ve seen bosses mistreat their team, but I don’t think I’ve ever seen any of them, make them cry.

GINI: And the worst part is his chief operating officer was his CEO at his previous company. So she was just she was so what we discovered later is she was so abused. But she just thought that was normal. Wow, terrible.

CHIP: That’s terrible that that is atrocious. And but it is it is one of those good red flags, which is how someone treats their team is likely the best of how they’re going to treat. Correct. And they may treat you even worse.

GINI: Yeah, definitely worse because,

CHIP: yes, short term I treat you better because you’re your vendor.

GINI: Right. Very right. But But yeah, you’re right. You’re right.

CHIP: But if they if they believe their team, and your day is coming,

GINI: yeah, yeah. Yeah. So, you know, and in the work, and I think then the work that you do with clients to you, we really sit down and we say, Okay, what does your ideal client look like? And not just a business type, revenue, all of that, but characteristics, attitude, all of those things. What does that person look like? Because you have to be able to create a list of questions that you can ask and it’s not just a one surface question. It’s the you know, you continue to dig will tell me more about That why, why? Why? Because then you start to see if there are red flags. And certainly there are going to be red flags. Maybe there are one or two that you’re just like, Okay. I mean, in the big scheme of things, I don’t really love that, but they feel fit all of these other boxes. And so you choose to ignore that. Or you find that there’s 17 red flags, and you have to, and I will admit, it’s really hard. It’s really hard to walk away really hard, but you have to be able to do it. Well, it’s

CHIP: particularly hard, I think, if you if you check 99 out of 100 boxes. Yeah, the one you didn’t check them maybe the most important one, right? And so

GINI: like, well, their check clear,

CHIP: like, well, their checklist is pretty, pretty darn important. But you know, I think the other thing here is, you know, not all red flags are created equal, right? So you also have to be careful that you don’t become so gun shy that if you see even a hint of a red flag and maybe it’s only even orange Maybe orange bordering on yellow. And you know, if if you react to everything and just say no to everything, you’re going to be in just as much trouble. So one of the skills that you develop, the longer that you’re in business is you understand which of those red flags are deal breaker red flags, and which of those red flags that, you know, maybe you just need to build something into the contract or something about the relationship to protect yourself from whatever that red flag is?

GINI: Yeah. And I think you can find things out in different ways. I think I’ve told this story on this podcast before, but I had a prospect that their chief marketing officer and I very easily could have been best friends like she was She’s amazing. She’s smart. She knew what she was doing. I really wanted to work with her. And the last step in the process was, you know, I wanted to meet the CEO even though I wouldn’t work with him day to day I wanted to meet him and succeed just come out the book. And so I took a signed copy to both of them and I gave it in the meeting. went fine. And I gave it to both of them at the end and he handed it back. Now remember, I had signed it to him, he handed it back to me and said, I don’t read books give this to somebody else. And for me, and maybe, I mean, I’m willing to admit it was maybe a little bit ego driven. But for me, that was a gigantic red flag because he didn’t have the way I perceived it is he didn’t have the professionalism and empathy, to bit to just accept the gift. Like, I don’t care if you don’t read it, except the gift and I walked away from it. I was like, This is not I can’t do this.

CHIP: Right now. You need a little bit of emotional IQ. Yeah. Later, turning down an author’s book when given freely, regardless of whether it’s subscribed, it just makes no sense. none, none. Now, I could understand, you know, maybe if it’s, you know, a 500 pound book and they’re handing it to you as you’re trying to get on an on an Air Flight or Like that. Yeah, and I certainly have had cases where I have turned down gifts just before I’m about to fly, because they’re hard to fly with. So

GINI: right I want that so I cannot take a bottle of wine through TSA. Yeah, as much as I would love to.

CHIP: I was once given a bottle of moonshine a couple of hours, but it was not from Chris Patten. No, no, I moonshine is probably not complicated enough for Chris, I think he probably would come up with something far more

GINI: 99% proof vodka or something?

CHIP: Yes. And for those of you don’t know, Chris, Ben is the modern day real MacGyver and comes up with all sorts of creations inventions, and occasionally makes videos about them too. But But yeah, I mean, so you know, there are times where you need to politely decline a gift because, yeah, something like that. But a buck

Unknown Speaker
and his office in his office

CHIP: in his office, right so he could just literally just take it and plop it right down and never think about it ever again. So trash

GINI: for all I care.

CHIP: And I will tell you, I have gotten Many, many free books that I have never opened up as if I and, you know, but but I don’t throw it back in someone’s face and say no, I’m not getting your book.

GINI: Yeah. So I think to your point, there are lots of there are lots of like, that may not be a red flag for you. It is for me and and

CHIP: red flag that should go into the mix. You know, going back to my original point earlier point. It it’s not necessarily a deal breaker in the context of other things. It may be because it’s, you know, it’s clearly an indication of, of character and approach that is likely to impact how your agency relates to that client.

GINI: Yeah. And the emotional IQ I think is really that’s a really good point. that’s a that’s a really solid way of looking at it. Do they have the emotional intelligence to be able to work with you in a way that’s going to get them results?

CHIP: Yeah, and that’s a hard one because it’s you know, I, I will freely admit that I am not the biggest people person out there. I mean, I tried to nail the basics like Don’t just outright refuse the gift. Right? There’s no good reason to but you know, I mean, I am not the the warm, fuzzy type who tends to walk around to vendors or team members or everything. Our way to go is fantastic. You know,

GINI: what, I don’t think you need that. To have a professional relationship, right? I mean,

CHIP: sure, but but my point is the different you know, there are people who are at different places on that that scale.

GINI: Okay, that’s fair. Yeah. You know,

CHIP: you, you may not be the most empathetic, sympathetic, highest emotional IQ person and you may still be fine to work with, but it is it is something that needs to be in the mix because every agency client relationship has its trying times, and I you know, there’s never an agency client relationship that is 100% hunky dory every day. Always because great things come up things. Yes, people have bad days even Yes, you met sometimes you don’t hit a hit a project out of the park. Maybe you only get a single or a double. Hopefully you’re not like you know the Boston Red Sox or the Houston Astros. just totally cheat your way through it. There’s a Red Sox really, really bitter about that correspondence. Yeah. about this. This will be old news. Yeah.

GINI: But yeah,

CHIP: but yeah, so what we’ll have to do a show on cheating at some point because that you know, this cheating in business too. It’s not just not just Major League Baseball, professional sports, weather is cheating. But actually that’s a that’s a red flag right there, right? If you if you’re talking with a prospect or a client, and they indicate that they’ve engaged in some sort of deceitful or unethical behavior, even if it’s not directly related to the work you’re doing with them, that’s a red flag, that’s a red flag, because you know, that goes to the way that they have an organization thinking behave, and if they’re willing to cut corners in one place, they may cut corners somewhere else, too.

GINI: Yep. And I would say there are red flags in tactics as well. Like, you know, what do you what do you expect our workers to do? What does success look like? If their answers are an realistic are their expectations are out of whack, and you don’t think you can bring them around? Of course, we all think we might be able to bring them around with education and all that. But, you know, if if the expectation is that, you know, you’re hiring us to do PR, and you would you expect us to generate $12 billion in revenue, probably not going to work. So, you know, you have to look at those kinds of things, too. And ask ask those kinds of questions. You know, what does success look like? I love to ask, have you worked with a PR firm before? If the answer is yes. What was your experience? What’s you like? What didn’t you like, you know, what kinds of results did you expect? What kinds Did you not get those kinds of things? Because that also tells me if they’re, if they’re just being unrealistic, and they don’t really understand how it all works.

CHIP: Right. And that’s, I mean, that’s one of those questions that I love asking now, in my current role, too. I’ll ask Have you ever worked with a coach or management consultant? Yeah. So that I can I know what I’m getting into and and My experiences that a significant number of agency owners have experimented with something in that area before

GINI: and always, almost always, it’s bad. Almost always,

CHIP: almost always like to think it’s good to work with me. But you know, hey,

GINI: well, you know, you’re not a people pleaser.

CHIP: I’m definitely not a people pleaser. for better for worse, I call things like ICM, which I’m sure people have already figured out from listening to this podcast. But you know, I think you made a couple of good points there. One is the expectations. It’s really, really critically important that there be alignment. And that’s that’s one of those ones that it’s so easy to just toss away and say, they’ll come around, you know, we’ll, we’ll work that through right as we put together the plan. Yes, I know, they think that we can double sales in six months. We can’t they really know that they’re just pushing the envelope. So that’s so expectations is one. But the other one I think is particularly important is something that’s come up a lot in my career, I think probably because I worked in public affairs and politics for a long time, which is tactics and what they believe you can or should be doing as far as tactics and there are certainly, you know, in the world of Public Affairs, there’s often clients who say, you know, well, I, you know, I want us to go out and push this messaging but no fingerprints. no fingerprints is one of those those terms of art in public affairs, that basically means surreptitiously, you know, we don’t want any anyone to know that we’re the ones who are pushing this. Most times that doesn’t work out well. Right. Although there’s a lot of it that takes place and I think, you know, folks would probably be surprised at just how much no fingerprint stuff really does go on and Public Affairs and politics. Yeah, but But certainly, if you’re seeing that outside of the world of Public Affairs, that’s a huge red flag inside public affairs that may just you know, mean that you need to, to coach and coax a little bit, but you know it so again, I’ll red flags are not created equal, but understanding, you know, what lines the client wants you to cross or is willing to cross? Yeah, that needs to be alignment and you know, And look, it’s it’s a it’s a more challenging environment for PR and marketing agencies these days, particularly as we look at things like GDPR and ccpa. And all that, you know, there are, it would be unfair to say that that that anyone is in 100% compliance, I don’t think there is any agency or marketer inside an organization that is in 100% compliance with everything. And yeah, you know, it, you have to do the best that you can. But if you have people who say, Look, I don’t care about it at all, just, you know, do what you got to do. That’s different than saying, Look, do the best you can, I know we’re not going to have 100% compliance, but, you know, make best efforts. And so, you know, knowing where things fall on those spectrums is increasingly important because everything that we do is coming under greater scrutiny. Now started a few years ago with the the FTC disclosure requirements around influencer marketing, I guess don’t really start there. But that was one of the bigger ones out there and it still continues to be a challenge today. And you know, those rules continue to evolve and So, you know, simple things, like saying client in a tweet, you know, may or may not be sufficient anymore. Right? Right. You know, there’s a lot of things like that that take place. But you know, you want to make sure that you have alignment with your clients on those otherwise, that’s a red flag.

GINI: And I would also say, you know, the amount of time that they require of you upfront. So before a contract is signed, when it’s at the prospect level, you know, if somebody calls you in the middle of the afternoon and expects you expects a phone call back from you, you know, at five before five, and then they keep you on the phone for two hours, that’s a red flag, you know, if they don’t honor your boundaries or respect your boundaries, you know, while they email you on the weekend, and they expect you to respond or you know, things like that are also red flags, you know, look for, look for opportunities for you to interact or engage with prospects at that level too, so that you can see, do they respect my boundaries? Do they understand that, you know, there are things weekends and evenings Things that are not available and things like that,

CHIP: right? And you know, how they behave during the the prospecting process is typically how they will react and engage with you once they become a client. So times as well. But so, you know, if they’re always late for calls, or they miss calls or meetings or you go to their office for the pitch, and you’re left sitting there for an hour pastor, yep, real time. Yep. Or, you know, they’re, you know, they’re particularly, you know, short with you. And they’re like, okay, you know, I know we booked 30 minutes, but you know, I’ve really only got 10. Now, you know, all of those things are things that you need to, to put down his red flags. Again, they may not be deal breakers, but you want to factor that in. And so, you know, if they’re constantly canceling meetings, you’re not getting back to you quickly on proposals. You may want to build in longer times in your timeline for the project, right? If you’re slow to get to you during that new business process, they’re probably going to be slow in delivering what you need on the execution side as well. And so that’s just that’s something to be aware of, and Red flag to consider how that impacts your decision to engage in that relationship.

GINI: Yeah, I think all in all, there’s there are, to your point, I think they’re yellow flags, orange flags, and then there are red flags. And if you have a significant number of red flags, you just have to be able to say, you know what, I just don’t think that we’re the right fit for you. And I always liked this is just a personal thing. But I always like to give referrals, you know, I think so. And so, so and so and so, so would be happy to talk to you. Let me let me make some introductions and then just walk away.

CHIP: Right. Right. And I think that agencies don’t spend enough time trying to think about the fit of their potential clients, that you know, that everybody talks about differentiation. And, you know, how are we different from the next guy? And I really think that that’s the wrong way to look at it. It’s really finding the clients who are the best fit. And as you said, early on in this conversation, it’s not just about you know, what, what size organization they are, what industry are they in, it’s a lot of that personal dynamics. It’s, you know, What’s the shape of their team? It may be you know, what generation their leaders are from it may be, you know how long that person has been in the role. There’s a lot of, you know, more subtle cues that help you figure out who those best clients are. And the more time that you’re in business and start looking at those little details, the better you can find those fits. And also, the better that you can identify the red flags. And the end of the The other thing I’d say on red flags is, you know, we’re talking mostly about red flags that come up in your direct engagement with the prospect or client, but you should also be doing due diligence on your clients and prospects. You know, doesn’t have to be super in depth where I’m talking for background checks, but you know, maybe Google, just maybe my IP worth Google, they’ve

GINI: gone to prison.

CHIP: Well, you, you joke about that.

GINI: There’s a reason for it.

CHIP: I have had situations where I am I have worked with clients who after the fact I found out had prison time in their background. And, you know, this was a long time ago and at the time would have been a lot more challenging than it is today to identify that today, I could probably find out in about two minutes of googling that that was the case. But yeah, but nevertheless, it it’s worth doing at least some high level due diligence to see what else you can find out. And I mean, hopefully, you’re doing this before you’re going into the first meeting. So you’re not going in blind. But you know, take a look at the LinkedIn profile for the folks that you’re meeting with Google the organization, see what’s there, Google them, and then add in PR agency or marketing agency or whatever service it is that you do, and see if anybody’s written positively or negatively about how they’ve engaged on those things. You know, if you’re doing search engine optimization and marketing for someone, you know, it’s worth doing a quick search to see if they’ve ever had any trouble in the past because some organizations are into the big trouble, right? So you know, now with the services that you’re providing and just do a little bit of searching around To see if there’s anything there that you ought to be aware of it might help you win the business, or it might help identify that red flag.

GINI: Very smart.

CHIP: So we raised any red flags in this conversation, and hopefully you will be back with us next week for another enlightening episode of the Agency Leadership Podcast. And with that, I’m Chip Griffin.

GINI: I’m Gini Dietrich,

CHIP: and it depends

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