AJR Spin Zone

A Blog for real PR and marketing pros (and students) to discuss client and agency-related challenges ... as well as random thoughts on the biz of spin. Should be fun. alec

Thursday, October 08, 2009

New Client PR Red Flags: Clients to Avoid (maybe)

We work with a lot of small business and start-ups.  I enjoy working with entrepreneurs as I find the accounts exciting, high-energy and challenging both from a creative standpoint and from a business / financial management perspective. They keep us fresh with ideas and with our skills.

Over the last 20 years I have worked with dozen and dozens of successful start-ups started by serious entrepreneurs.

However, I have also had my share of kooks, from a guy that claimed a government conspiracy was preventing him from launching his anti-hurricane technology post-Katrina to a firm that insisted I did not need to know what his business did, who is customers were, all  he wanted was for me to perform a publicity stunt as if I was a trained seal.

Through the years I have seen it all, and here is a sample list of red flags when dealing with potential start up and new clients looking to hire a PR firm.

Some red flags are just out of naiveté in dealing with an agency, others are signs of something far more serious. So take these red flags with a grain of salt, my observations are just that and at the end of the day go with your gut!

 

  • We don’t need a contract

Translation: we plan on screwing you.

 

No contract = no work. That is our policy. Yes, learned this the hard way. That’s why I now use a  lawyer to review all contracts.

 

  • We’ll pay you at the end of the month (or we have good credit)

 

Translation: we want you to be our bank and finance our PR with your other clients’ fees or from your cash flow.And we will pay you when we can.

 

  • We want to grow with you

Funny how concerned they are about your business.

Translation: we don’t have money, but if you do a great job for almost free, one day we can hire your bigger competitor.

 

  • We want to do a one-month program and see the results

 

Translation: We don’t trust you and want a quick sales gimmick or a hit

 

Ans: if you want a quick hit, buy an ad, PR is an investment in your brand not a sales gimmick

 

  • Can you guarantee results?

 

Translation: We don’t trust you and want a quick sales gimmick or a hit

 

Answer:  we are a professional services firm, much like a doctor, lawyer or a CPA, and as such we provide professional services for a fee.

 

  • How can we trust you?

 

Translation: Because you can’t trust us.

 

Answer: (this one makes my blood boil and I never work with these people)

 

I’ve been in business xx years and have impeccable references, and what about you? Can I trust you and see your references? That’s what we have a contract.

 

  • We want to pay a success fee or a percentage of the fee then the rest based on results

 

Translation: you will never be successful for us to pay in full, because we will keep changing the definition of success 

 

  • We have no competition

 

Translation:  clients that say this either have no clue about their business or have the monopoly on Oxygen

 

  • We want to see creative ideas, strategies and tactics 

 

Translation: we want to steal your ideas and do it in-house.

 

We get around this by having a huge case study library and references.  We do not (almost never) give ideas away to clients. Period (mostly).

 

We want you to pay our expenses and bill us later

 

Translation: we don’t have money and want you to be our bank.


We will front wire fees and small expenses for solid clients, all other pay up front or pay direct. 

 

  • Can we pay you at the end of the project?

 

Translation: we’ll screw you at the end and pay you less than the agreed upon cost

 

Ans: if it’s a project we take 50 / 25/ 25

 

  • 50% to start (non-refundable)
  • 25% when halfway done or a set time  say 30 days
  • 25% at the end – this way all I have at risk is the profit margin, assuming the project has not gone south by that time anyways 

With all start-ups and small businesses we insist on payment up front and then we can slowly move them to net 15 or net 30 if they have proven themselves as creditworthy, because I’m not a bank.

PR is a major investment for these firms and I get that.  However, if they do not have the money to pay up front you put yourself at risk of being paid last, paid late or not at all.

You have to be ready to walk away from a deal if the client cannot pay his first month’s fee in advance, won’t sign a contract or other red flags. This can be tricky, especially of you are starting out as a solo pr person.

Some of my best clients are stat-ups and small businesses, but I have also lost money over the years because I did not listen to my gut.

 

2 Comments:

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