In Episode #441, Eric and Neil discuss how to avoid over-servicing clients. Tune in to learn what the Zero Dollar Charge Order is, the value of doing exactly what’s stated in your contract, and how to prevent being taken advantage of by your clients.
Time Stamped Show Notes:
- [00:27] – Today’s topic: How to Avoid Over-Servicing Clients
- 00:47 – Eric uses Hubstaff, which is a time tracking tool
- [01:00] – It’s important to internally track time in a company
- [01:15] – You don’t have to charge per hour, but audit your time wisely
- [01:38] – Follow what’s in the contract
- [01:44] – Learn how to say “no” if it’s not in the contract
- 02:07 – Eric hired The Smart Agency Podcast’s Jason Swenk
- [02:20] – He created the tactic called “Zero Dollar Charge Order”
- [02:27] – You send an invoice for zero dollars that states the services you gave for free
- [03:35] – If you have to charge for it, charge for it
- 03:59 – Marketing School is giving away 90-day FREE trial to Crazy Egg which is a visual analytics tool
- 04:07 – Go to SingleGrain.com/giveaway to get your FREE copy
- [04:11] – That’s it for today’s episode!
3 Key Points:
- Track your time internally as a way of accountability.
- Stick to the contract—learn to say “no” to additional work that’s being offered by your client.
- Don’t be afraid to charge if you need or have to.
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Full Transcript of The Episode
Eric Siu: Welcome to another episode of Marketing School. I'm Eric Siu.
Neil Patel: I'm Neil Patel.
Eric Siu: Today we are going to talk about how to avoid over-servicing clients. This is something that I can speak to because I'm in the services space. Neil not so much anymore. Well, I guess Neil kind of, but ...
Neil Patel: Not really, but this is mainly all you.
Eric Siu: Yeah. Oh wow. Look, you're trying to throw it all to me. Okay. Great. I'll tell you what works. We use a tool called Hubstaff and that allows us to track time and it allows us to kind of which clients we're working on. It's basically a time tracking tool. If you're in the services-based business, it might seem like, "Oh, you don't want to track time or whatever." It's important for you to track time internally to make sure that you're not over-servicing a certain client especially let's say you have a client that's paying a $1,000 a month versus a client that's paying them $20,000, you're giving them the same time, that's a bad allocation of time. I'm not saying you should charge by the hour per se, but that's what you need to do.
You need to make sure that you're auditing your time because you are in the service-based business and you only have so much time at the end of the day. That's one thing that's important. Check out Toggl. That's T-O-G-G-L. There's Hubstaff. That's H-U-B-S-T-A-F-F, and there's a bunch of other tools out there like Harvest as well. You can start with that first. Neil, what are your thoughts because I know you do some consulting from time to time?
Neil Patel: Make sure you follow what it's in the contract. A lot of people, just clients ask you for more and more and more. If it's not in the contract, you have to learn how to say no. If it's something small here or there, no big deal. You don't want to be a penny-pincher and just be like, "No. You need to give me more money for every little thing," because it's about building relationships and helping people as well. The moment they're asking you for really big stuff that's out of the scope, you should say something about it. You know what? That's a great time and opportunity to start upselling people. I'll give a recommendation here. There's actually another podcast called The Smart Agency Podcast.
I actually hired this guy, Jason Swenk, sold an agency for I believe $20 million, maybe $10 million. I don't know, but something like that. He has a tactic called The Zero Dollar Change Order. When you have a client that keeps asking you for more stuff, you say, "Hey, okay. That's fine. I'm happy to do it for you." What you do is you send them an invoice for zero dollars and it maps out kind of the extra free stuff that you're doing, but it's basically a record that shows that you're doing this stuff for free. They'll come back to you again. "Hey, can you do video ads," for example. "Oh, happy to do some video ads for you. Here, let me give you the second zero dollar change order." They'll come back to you again. "Hey, third time, can you do SEO?"
"Sure. Happy to do SEO, but we already have these two zero dollar change orders. Guess what? I think we're going to have to start to charge for this. How about that?" Guess what? They're going to feel weird because, they're going to feel because bad because they already got two bits of free work for you. They're not going to want to keep taking advantage of you. If they are, they're probably not the right fit for you long-term. That's one way to avoid scope creep. Because the problem with services sometimes is people are just going to start asking for more and more. It's much easier to say yes than it is to say no because no is actually really uncomfortable. Just keep that in mind. Use the zero dollar change order.
Check out Jason Swenk's podcast around agencies. There's actually a lot that he can teach you.
Eric Siu: I don't really have anything on mind. You pretty much covered it all. I even got a blog post published right now and even promoted it while you're talking.
Neil Patel: Oh wow. Look at that?
Eric Siu: All right. That's it. Think about scope creep. Think about how you can protect yourself. If you need to charge more money, charge more money overall and say, "Hey, this is not in scope right now." Sometimes you need to just stand up and say, "This is not in scope. Here's what we need to do to get you what you need." Then also it's the same time, it's like Neil saying it's an upsell opportunity. You might launch into another kind of sales conversation and find out what their needs are, ask them questions again like we've discussed in one of our recent episodes. Before we go, we have a 90 day free trial of Crazy Egg to giveaway to each and everyone of you.
No credit card is required and it's worth up to $3,000. To learn more, just go to singlegrain.com/giveaway and we will see you tomorrow.
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