The Breakup: Tips to Deal with Lost Clients & Monitoring Your Attrition Rate - Kyle Gustin
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The Breakup: Tips to Deal with Lost Clients & Monitoring Your Attrition Rate

dropped clients attrition rate

The Breakup: Tips to Deal with Lost Clients & Monitoring Your Attrition Rate

Losing a client hurts. Especially great ones, or clients who were paying you well for your services. The following post needs to be strongly considered by the president and owners of  your organization, as they have by far the most influence, while their staff will consistently and subconsciously draw from their emotional state.

When clients drop out seemingly out of the blue, or after a small hiccup in the campaign, it can leave you and your account manager in a grieving state.  When emotions are high, I learnt an extremely valuable lesson from a mentor of mine with 20 years industry experience. And his advice went against all of my natural instincts. The advice is as follows:

Not unlike a breakup, one party will have been planning their exit for weeks or if not months already before you even heard about it.

By the time it’s brought to your attention, there’s nothing you can do. Your first instinct may be to try and fight for the account. Try to remedy what happened and make it right again. But your instinct is false, and in a sense, it’s time to move onwards.

All the decisions have been made on their end. Our job now is to exit the relationship gracefully. The range of emotions you’ll be feeling will likely be like a whirlwind. That’s normal.

The classical grieving progression goes like this:


The first step is to deny that this is happening, and block out the facts which are on the table. Certain team members may be unable to even acknowledge is for quite for time; especially account managers who dealt with them closely.


The reality and pain of the situation now immerges. Many people will become angry at the former client, their internal team for mishandling the account details; if major mistakes were made, it’s common to hear some lash out and blaming during this phase.


Why did this happen? If only we were to do x and y, this would have never occurred. Should I have done this sooner? Should their account manager have pushed on this point harder?

This stage is actually helpful when done as a pot-analysis (productively) in-house, while calmly laying out the learning points we’ve gained. The experience as a whole needed to be re-framed as a learning experience, in order to not make those same mistakes next time.


This grieving state, which is immensely true for a loss of a loved one, is just as true with a loss of a client. Each stage is felt my various people in your organization, and sometimes at different times. It’s important to pull together as a team and identify those who are struggling with a big client loss.


From my experience, accepting the situation in full either takes:

  1. Time (a lot)
  2. Realizing that one client wasn’t our “be all end all” (focusing energy elsewhere to the point of forgetting)
  3. The signing of a new, fresh and more exciting client (see the door close and a new one open)


Eventually, in this business, every agency gets fired at least once if not more.

And if you’re a great agency, changes are, the issue can be on the client’s internal side. Or in bad economic times, the first spending cuts will always be marketing channels. That could mean you.

Wait, What if They Breach Their Contract With Us?

This can make agency owners extremely vivid. I’m one of them. However, trust me; legal action and nasty phone calls are not the solution you want long term. Avoid picking up the phone and letting them have a piece of your mind. Avoid threats of litigation and how much money you’ve lost.

In an agency business, this type of thing, unfortunately, goes with the territory. Clients can breach contracts anytime, and the main takeaway I want to give here is …. it’s not worth fighting. This

The best course of action is to thank them for the work, apologize that the expectations weren’t met (even if they actually were) and part ways amicably. If your tongue is beet red of biting the entire time, that’s normal.

Strategic Reason: You never know who that former client is friends with. Top business circles are small and elite; the last thing you want to do is “scorch the earth” and have your reputation compromised just for some menial amount of money and your own ego.

Take a deep breath. Let them go. And if it was meant to be, it’ll come back eventually, due to the professional way you handled the situation.

But How Much Clients Are You Losing Per Year?

This is called attrition rate. It’s a metric everyone should know, an equation that uses the total count of clients last year .vs the total amount of clients this year vs. the total amount of new clients added throughout the years.

You’ll also need the average transactional value per client – take an average of all transactions.

Take the test here:

Interpreting Results:

The ideal customer retention score is 10-15%, and is factored in the annual sales and growth budgeting. This means to improve sales by 30% next year, we not only need 30% more business but an extra 10-14% to account for client drop-offs. So you will really need 40-45%.

If your attrition rate is higher than 14%, that would be a good conversation with customer service to really drill down and find the issues, It may not always be what you expect.

Warning: Avoid the “seasonality trap”, which is the most common excuse for low sales or customer drop-off. There are many things that can do don to make seasonality industries a stable industry all year round. But that’s for another post.

How Can I Preemptively Lower Attrition Rate?

Start With Clear Expectations, Deliverables & Stellar Account Management

With every new account should include an expectations and deliverables document, for review by both parties. This is after the contract is signed, and has a different function. The function is to align both the client and your company on what a successful relationship entails. For example, if the client does not provide you with what you need to succeed, you need a document to fall back on outlining exactly that.

Your account manager’s primary role is to build a relationship with that client and to be a friendly go-between. They are arguably the most important person on your team. A bad account manager will lose your shirt. A great one will keep attrition down low, keep clients happy and ensure your contracts and relationships are secured.

Send Anonymous Client Surveys Every Two Months to All Clients

This will catch anything clients’ may be too shy or sensitive to bring up in person. It’s difficult to tell someone how you truly feel when they have a strong relationship and rapport built up. Sadly, this could turn into a liability.

The best software to use is Ask things like:

  • How likely is it that you would recommend us to a friend or colleague? (1 – 10)
  • Overall, how satisfied or dissatisfied are you with us? (strongly dissatisfied – extremely satisfied)
  • Which of the following words would you use to describe our services? Select all that apply. (Effective, High-quality, Useful, Unique, Good value for money, Overpriced, Impractical, Ineffective, Other (please specify))
  • How well are we meeting your expectations? (Extremely well – Not at all well)
  • How would you rate the quality of the service? (Very high-quality – Very low-quality)
  • How responsive has your account manager been to your questions or concerns? (Very – Very low)
  • How likely are you to renew your contract with us? (Extremely likely – Not at all likely, What made you feel this way?)
  • What is something that you feel we could improve on?
  • What other services would you want us to implement
  • What do you find we do really poorly?
  • What do you find we do really well?

By sending a survey like this, and your clients knowing results are totaled and compiled anonymously by a third party, the truth will come out. Look at the results as an objective, truthful state of your organization and adjust accordingly.

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