Transitioning Legacy Clients
As a fledgling agency, the strategy was simple: you worked with anyone who would pay you. But as you grew, so did your mindset. You learned to focus on your ideal clients and tightened your positioning to attract them.
However, even the most established businesses still have legacy clients—those who have been with you since the beginning. You might feel this creative friction as they are not as profitable, nor do they align with your current business state. In this article, I will explore how to know when it's time to transition legacy clients and offer four ways to make this shift easier.
What are Legacy Clients?
Legacy clients are customers who have been with your business since its early days. They may have supported you when you were starting out, and you may have developed a personal relationship with them over time. Unfortunately, these legacy clients may not suit your current business or your profit standards when compared to newer customers. They may not see you as you are now, only as you were back then. As a result, they may not be willing or able to follow your new processes or pay your current rates.
When is it Time to Transition Legacy Clients?
Look for these signs to determine when it’s time to transition a legacy client:
They refuse to follow your new process (they want things the way they used to be)
Fee billings are low
Profitability is low
They are no longer a fit for the type of work you want to do
You no longer provide a particular service they need
You cannot apply the learnings from this client to other clients
Four Ways to Transition Legacy Clients
When you decide to transition legacy clients, it's important to give them enough notice and to communicate clearly and respectfully. Here are four professional, seamless ways to prompt this transition:
1. Increase Prices
One way to transition legacy clients is to increase their prices to match your current rates. This can help increase profitability, but may also lead to resistance or loss of the client. It's important to communicate the reasons for the increase and to show the value they are getting from your services.
2. Change Scope of Work
Another way to transition legacy clients is to re-scope their work so that it delivers profit to your agency. This may involve adjusting the services you offer or the way you deliver them, in ways that better align with your current business. It's important to communicate the changes clearly and to show the benefits for both parties.
3. Refer Them to Another Agency
If you know that a particular client is no longer a good fit for your business, then you can offer to refer them to another marketing agency that may be better suited to their needs. This can help maintain the relationship, and may even lead to new referrals in the future as they better understand your value proposition.
4. Create a Sub-Brand
A unique solution is to create a sub-brand within your business that is specifically designed for legacy clients. This sub-brand should offer lower prices, simpler operations, and unbundled services that are distinctly separate from your main agency brand. This can help maintain the relationship with legacy clients while also freeing up resources for your main business. As an example, I've seen experiential agencies do this by creating sub brands that focus solely on staffing. This allows them to work with different clients who don't have the budget for bigger, immersive events.
Key Takeaway
Pruning certain clients from your client list is a necessary part of building the business you want. Legacy clients may have helped you get to where you are, but they may not be the right fit for your current business goals. By recognizing when it's time to transition them—and by using the right approach—you can maintain the relationship or move on in a respectful, profitable way.