Did you know that the average relationship between marketing agencies and their clients has declined dramatically over the years—from 7.2 years to less than three? For startup marketing agencies, this alarming trend raises critical questions about building lasting client partnerships and staying competitive in a rapidly changing market.

How do you grow your revenue sustainably if customer churn is so high? This is when the importance of a successful client-agency relationship becomes apparent. The better your agency retains clients, the more stable and predictable your monthly recurring revenue becomes. 

But how do you ensure that the relationship remains successful? In this blog, we’ll explore actionable strategies to boost client retention—from the initial contract signing to consistently delivering results and keeping clients satisfied well beyond the first six months.

Table of Contents

• What Is a Client-Agency Relationship?
• Why Are Client-Agency Relationships Important?
• 5 Essential Factors of a Successful Client-Agency Relationship
• How to Measure the Success of an Agency-Client Relationship
• The Future of Strong Client Relationships

What Is a Client-Agency Relationship?

Let’s break down the key responsibilities of both marketing agencies and clients to gain a clear understanding of what successful client relationships entail. 

Think of your client as someone who wants to find wealth and riches in an unknown territory, and your agency is a guide who creates a map to lead your client to their dream, open a mine, and make sure it brings sustainable profits year after year. 

With this analogy in mind, your client's responsibilities are:

• Communicate what they want to achieve from partnering with your agency, whether it’s increasing brand awareness or increasing conversions.
• Provide constructive and meaningful feedback to help your agency improve its services and offerings.
• Provide regular and timely payments.

Your agency’s responsibility is to help the client translate their wishes into SMART goals and to establish KPIs that will help track the progress toward achieving them. 

Your responsibility is also to listen to the client’s feedback and improve your practices to better align with customer expectations. 

You may also consider standing up to any poor performance or subpar results by issuing refunds or providing discounts to your clients. 

Last but not least, your agency should position itself as a way to elevate your clients’ expertise. True, your marketing team may never become a crew of subject matter experts, say in law or real estate, but your employees can help your clients translate technical jargon into easily understandable packages of information that resonate well with common folk and communicate the unique selling propositions and benefits of all of your client’s products and services in an appealing way.

How do you market a pen, for example? An owner of a local writing supplies store might well rack their brains over the answer. As a marketing agency, it’s your job to brand a pen as a valuable object that has the potential to become someone’s long-life companion. Just think of all those cute pens that have pendants on top! 

Why Are Client-Agency Relationships Important?

To ensure a steady stream of new customers, you should build a strong portfolio of satisfied clients who stay with your agency for decades and can attest to your expertise. Mastering client retention strategies is handy in this regard.

For example, Twin Creek Media has been working with Scouts Canada for around 8 years. The results they’ve achieved, including the design of multiple websites and an overhaul of the main site, wouldn’t have been possible without the long-term commitment and collaboration. 

Another one of their long-term clients is Metal Structure Concepts. Their fruitful partnership, which has lasted for around 10 years, has ensured that the company’s website secures 69 top ten Google positions and attracts 500% more customers, ensuring that the company’s sales funnel is always full to maximum capacity.

You can’t deny that having such case studies featured on Twin Creek Media’s website is a surefire way for them to attract more clients by reaping the benefits of social proof in the form of enhanced credibility. 

5 Essential Factors of a Successful Client-Agency Relationship

Let’s examine the common root problems that make client-agency relationships go sour and the tactics to overcome them through effective client management. 

1. Clear Goal Alignment

One of the biggest reasons why clients churn is that they aren’t satisfied with their marketing ROI. Your agency may be putting a lot of effort into a marketing campaign that drives results; the only problem is that these results aren’t the ones that your clients want to see. 

For example, your team could be working on building and optimizing a company’s social media profiles while all your client cares about is an increase in the number of phone calls and booked appointments.

Creating thorough contracts and agreeing on the KPIs to track from the very beginning of a client relationship can safeguard your agency from any accusations of not delivering on your promises later down the line.

Here is an infographic that has tips on which KPIs to track for which industries:

When it comes to setting marketing goals, following the SMART framework can be useful. According to this framework, goals should be Specific, Measurable, Achievable, Relevant, and Time-bound. This is a great way to protect your agency from scope creep, which is an uncontrolled mutation of your marketing efforts. 

Marketing is one of the fastest-evolving fields, making it essential to regularly reassess your marketing goals. By doing so, you can ensure your budget is allocated effectively and take full advantage of agile budgeting strategies to stay ahead in a dynamic landscape.

The partnership between Vendasta and Cyrusson is a great example of a clear goal alignment that has paved the way for a fruitful partnership since 2019. Cyrusson needed to combat a decline in revenue due to a decline in print advertising. The agency was searching for an online marketing platform they could leverage to transition to the digital realm. 

Vendasta’s all-in-one white-label AI marketing automation software was an ideal solution that enabled Cyrusson to drive generation demand for their clients.

2. Open and Transparent Communication

Poor client communication between agencies and clients is another red flag. When your agency competes with others for client acquisition, you can win clients over with the power of first impressions: friendliness, honesty, and respect. You must maintain this style of communication long after signing the contract. 

One of the ways to ensure your clients are never left in the dark about your marketing efforts is by leveraging a white-label client portal to communicate with them. For example, Vendasta’s Business App is an effective way to keep your clients informed about how their social media ads, search ads, and content marketing are performing.

By partnering with Vendasta, you can present the comprehensive client portal under your logo and empower your customers to always keep track of their KPIs in real-time. 

Vendasta also lets you keep your partners updated with automated client reporting, where your customers get regular emails asking them to log into the Business App and check out their wins. 

Here’s an infographic that recommends the best frequency for client reporting for different industries:

Let’s examine how Twin Creek Media ensures regular client reporting. In their case study about their partnership with Kestrel Ridge, they emphasize monthly campaign optimizations and underscore the importance of this cadence for ensuring the best results.

A successful client-agency relationship goes beyond providing regular updates through client reports. Listening to client feedback and incorporating it into your strategies is essential for building trust and delivering results that truly meet their needs. 

3. Defined Roles and Responsibilities

Does your client want a new, well-optimized website, an awesome, high-quality blog, an effective ads campaign in Google search, and stunning social media profiles on Facebook, X, Instagram, and LinkedIn? 

We’ve all been there, and the temptation to say “yes” to all of these wishes is often very strong. Yet, your agency must not bite more than it can chew. 

The first step in making sure you don’t fall into the common trap of overpromising and underdelivering is to have a clear understanding of each of your employee’s responsibilities. A common makeup of a marketing agency is:

• Marketing Coordinator: This individual brings skills in content creation and strategy design.
• Web Developer: This individual brings programming and design skills.
• Social Media Manager: This individual specializes in content creation, design, and project management.
• Data Analyst: This individual excels in project management and strategy development.
• Graphic Designer and Videographer: This individual has superior design skills.  
• Account Manager: This individual has project management and strategy development skills. 

Once you know the full scope of services your team can provide, you can rest assured that you and your clients will always be on the same page about what results your agency can deliver. 

As a rule of thumb, never promise a client to build a website for them just because one of your employees mentioned they have a friend who dabs in freelance website development. Unless you have a dedicated web developer on the team, don’t give promises you might not be able to keep. 

On some occasions, however, outsourcing may become a viable part of your agency’s business model. White-label service providers, such as Vendasta, can help you expand your portfolio of services. Take a look at Vendasta’s AI workforce, for example. 

If having an in-house team of developers and designers is so costly that you can’t afford to hire any other marketing specialists, you can leverage Vendasta’s AI Content Creator and SEO Expert to get the job done.

In the long run, this is extremely cost-effective because AI employees come with less overhead costs than human employees.

4. Data-Driven Decision-Making

In marketing, clients often churn because they don’t see how their marketing budget translates into tangible results in terms of revenue growth. That’s why it’s important that your marketing agency keeps track of each of the marketing campaign’s KPIs and retains clear proof of performance. 

With machine learning, analyzing the efficiency of various marketing strategies becomes far easier and more precise than if performed by human analysts. That’s why your agency should leverage AI to make sense of the metrics to guide your marketing strategy. 

A good example is CodeCrew’s email marketing campaign for PetLab Co. In their efforts to package a variety of pet products into clear-cut email marketing campaigns for the company’s target audience of pet owners, CodeCrew relied on AI for data-driven segmentation and A/B testing. 

This reliance on objective data and facts helped CodeCrew ensure that their email marketing efforts led to a 53.33% increase in email click rates and a 37.5% rise in open rates. 

AI also excels in simplifying upselling and cross-selling processes because it is unsurpassed in analyzing vast amounts of data and detecting trends and patterns. One common example of this is Amazon’s “Also Bought” section, where Amazon’s AI algorithms give customers recommendations on what items to bundle with their current purchases. 

However, you don’t need to have a marketing budget the size of Amazon’s to leverage AI for upselling and cross-selling. For example, Vendasta’s white-label Executive Report, which is part of an all-in-one white-label agency management software, equips your clients with the knowledge of how their marketing efforts are performing and gives them automatic recommendations on what marketing services to opt for to see even better results. 

The best part? All of the services the tool recommends for your clients are services you can offer yourself, white-labeled as your own, all from our Marketplace.

5. Proactive Problem-Solving

If you handle a lot of customers at the same time, it could be tempting to overlook certain issues with one marketing campaign, especially if they seem minor. However, it’s a bad idea to wait for the customers to point out a problem first. This erodes trust between your clients and you. 

Once they feel like they can no longer rely on you to spot problems, what stops them from wondering why they can’t handle the marketing efforts on their own? 

If you notice that a marketing strategy isn’t performing as expected, it’s best to have an emergency meeting with your client to brainstorm ways to improve. 

For example, if there’s not enough budget allocated to Google ads to drive a meaningful increase in calls and appointment bookings, perhaps you could convince your client to reallocate funds to create a robust website first and compete for top rankings in SERPs later. Or maybe you and your client could settle on a more cost-effective marketing channel, such as email marketing.

A real-life example is the same PetLab Co. case study examined earlier. Before they engaged with CodeCrew, their key problem with email marketing was the high number of emails that ended up in the spam folder. If their previous marketing partner had taken a proactive approach to solving this problem, they could have searched for the root cause and figured out that the problem stemmed from the fact that the marketing emails included links to third-party sites. Instead, they allowed the marketing campaign to run as is, which led to losses of revenue and engagement.

As an owner of a marketing agency, you should make sure that your employees investigate the root causes of any of the marketing campaigns’ poor performance rather than letting it go on and hoping the clients won’t notice. 

They will! And once they do, the result is, most likely, client churn.

How to Measure the Success of an Agency-Client Relationship

So, now you know that to secure long-lasting agency-client relationships, you need to:

• Ensure that your agency has a clear goal alignment with every customer,
• Have an open communication channel with each client,
• Ensure each team member on your team has a detailed list of responsibilities,
• Measure the performance of every campaign,
• Have a client-centric culture to solve problems proactively. 

Still, with all these key ingredients for success in place, you might want to take a more data-driven approach to measuring the success of your relationships with customers. Below are some useful metrics to keep in mind and strategies for assessing them.

Here is a useful infographic that briefly summarizes some of the key customer retention metrics, such as client churn rate and net promoter score (NPS):

Project Delivery Times

First things first, nobody likes missed deadlines. Your clients, least of all. It’s a smart idea to better understand the delivery times for each marketing project and then keep tabs on how long it takes your marketing team to implement and achieve meaningful results with each project. 

For example, if you develop a website in-house, an industry average is one to six months. However, if you outsource website development and market your website development service as “create a website in one day,” your timeline could vary between 1-3 business days.

Make sure your team meets the best standards for project delivery times. If not, identify the bottlenecks and do your best to clear the obstacles on the path to marketing success. 

Pro Tip: Vendasta’s white-label Website Pro services empower agencies that don’t have resources for in-house website development to add this product to their catalog.

Client Satisfaction Scores

Another handy way to gauge your customers’ satisfaction is by sending out customer surveys to collect their net promoter score (NPS). This metric helps you understand how likely your customers are to recommend your agency to their friends or members of their network. 

Vendasta’s reputation management software helps automate the process of analyzing client sentiment. The AI-powered reputation management platform sends out surveys that help segment clients into Promoters, Passives, and Detractors. 

Keep in mind that merely computing your agency’s net promoter score by subtracting the percentage of detractors from the percentage of promoters is not enough. If your NPS score falls below 53, which is an industry standard, according to Retenly, it’s worth the time and effort to dig deeper for the reasons why. 

In this case, sending out customer surveys with the help of free tools, such as Survey Monkey, can be extremely useful. Whatever it is that drives your clients nuts—poor customer service, missed deadlines, poor communication—you should know your enemy’s name and implement strategies to ensure 100% customer satisfaction. In a competitive marketing world, it’s the only way for marketing agencies to survive.

Repeat Business

Last but not least, you can evaluate the quality of your client-agency relationship by assessing whether your customers are open to extending their contracts or expanding the number of services they buy from your agency. 

Calculating the repeat customer rate is easy: divide the number of return customers by the total number of customers and multiply by 100.

CRM for agencies is indispensable because it helps you keep track of existing and returning clients and those who churn.

The Future of Strong Client Relationships

It might seem that generative AI makes DIY marketing easy. Small business owners can use ChatGPT to write blog posts, media posts, and even design images. Who will need marketing agencies, right? 

It’s too early to jump to conclusions. While generative AI, no doubt, makes content generation far easier, at the same time, the demand for high-quality content rises exponentially. 

Take an example of AI Overviews in Google Search, for example. These summaries provide succinct answers to commonly asked questions. However, they can’t displace expert knowledge that only your clients can provide. 

Let’s examine Twin Creek Media’s customer, Planet Bee, for example. Their page for recipes contains a plethora of unique recipes. Their Summer Berry Honey Fools is a unique recipe that calls for ingredients from their bee farm, such as Planet Bee Bee Pollen. Also, the company’s founder, Ed Nowek, has decades of unique experience learning about various beekeeping practices in different countries. 

Now, consider that Planet Bee is a family-owned business that is both an e-commerce shop and a retail store. Managing the two operations might be a hassle for a small team of staff. 

The case in point is: is it possible for the founder and his family members to take care of all the minuscule marketing tasks (writing content, product descriptions, running ads, and more) in addition to running their business? Highly unlikely. 

This is the moment where the client-agency relationship becomes increasingly important. Clients depend on marketing agencies to translate their unique experiences into narratives that resonate with their target audience and help them grow revenue at scale. 

Clients also need marketing agencies to help them take advantage of the most advanced marketing tools, such as implementing AI marketing automation workflows. 

If you’re an agency in need of white-label marketing software to kickstart your business, expand your portfolio of services, or improve your client relationship management, Vendasta is here to help. Request a demo today!

Frequently Asked Questions

What are the top common mistakes that lead to poor client-agency relationships?

Lack of clear expectations and deliverables, poor communication, overpromising and underdelivering, neglecting the relationship post-sale, and failure to address issues proactively.

What are the best practices for ensuring strong relationships?

Prioritize regular check-ins and updates, invest in training and development for your team, build a proactive communication process, foster a client-centric approach, and leverage technology to monitor and strengthen client relationships.

What are the key metrics to measure the success of client-agency relationships?

Client churn rate, NPS, repeat business, project delivery times.