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Is It OK to Say No To a New Prospect | Function Point blog

Creative Agency New Business: Is It Ok to Say No to a New Prospect?

When running a business in any industry, we all strive to attain as many clients as possible and reach out to as many prospects as possible. However, the very controversial underlying question is, “Is it ok to say no to a new prospect?”, in other words, is it ok to turn away new business? If so, why would you want to turn away a new prospect? What benefits, if any, would you get out of this?

In this blog, I will go over these points and outline what I feel is the best solution when approaching a new prospect or business opportunity.
Believe it or not, in some cases it is actually more beneficial for an organization to decline or turn away a new business opportunity if they are not able to provide the expected quality of work or service.

Recognize a good fit;

With every new client evaluation, ask yourself,

  • Is this client a good fit for our agency?
  • Does this project align with what we do?
  • Can we bring value for this client?
  • Can we make a profit from this project?

If, for example, let’s say your creative agency’s target market is small to mid-size companies because you’ve determined these are the most profitable.

In this case, either a large company or a small one will be out-of-alignment to your target. Now, let’s say you have a very large organization approach you, it may be best to be honest right-upfront and state that they are simply too large and it would not be beneficial for both parties to pursue the opportunity

What kind of brand capital are you building?

In our example, you’re better off because should your agency take on too large a prospect or project you make an implicit (if not explicit) service promise that you can accommodate this type of client, and this promise will determine what your client expects.

If you are then unable to follow through on your client’s expectations, the image of your agency will be hurt negatively and you can leave a bad taste in your clients mouth. This is often called “negative brand capital”, and you definitely want to avoid accruing this kind of capital at all costs. Not only does it effect your current brand, but can persist into the future, impacting your ability to gain that business in the future as you scale upward and try to attract larger companies.

You may loose valuable referral business also, as the disappointed client may not think of you when referring services to other companies, as they might feel misled by your organization and uncomfortable vouching for you.

Is it profitable?

On the other side, extending our example of size in the other direction, taking an opportunity that is too small for your organization may not be optimal for you, or your prospect, either. In a situation like this, it may actually cost you money or manpower to accommodate such a company. If your service offering isn’t streamlined to benefit organizations with a small number of employees, for example, the smaller clients may not see value in your offering, or on the backside, cause excessive touches and misalignment problems in your creative and support teams.

You can still help —  by finding them help

When turning away business that does not fit your intended target market it is a good idea to refer them to a better fit — another agency that can help them. Doing this leaves that prospect with a positive image of your company and can lead that prospect to recommend your company to organizations and people that are looking for your service.

Keep every interaction positive:

So when it comes to new prospects at your creative agency, consider whether taking on that new business is feasible for your agency but also ensure that it is feasible for your clients as well.

Leave the prospect with a good feeling about your firm by letting them know why you can’t take them on and recommend another agency that would be a better fit. A positive experience with your recommendation will leave a good impression of both your agency (and you personally) while building “positive brand capital”.

Happy hunting!

Eric Ivker | fp. Sales Representative

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