If the client has a sales team I'll (almost) never do a performance deal

Once upon a time, I closed a deal with a client for email marketing services. The client needed ongoing help so we agreed to a retainer. He’d pay me 15% of revenue generated from calls booked due to my emails.

I was excited to work on this account. If the conversion rates the client told me were true, I’d be making double my usual flat retainer fee for this scope of work.

But I made less than a flat retainer while taking on all the risk of 100% performance pay. Since then, I no longer do performance deals with clients if they have sales teams. Here’s why.

Sales teams are unpredictable

Sales reps have wild swings in performance and s*** the bed often. Fight with a girlfriend? Sales slump. Injury preventing him from working out? Sales slump. Prospects slightly harder to close than a 1-call lay-down deal? Sales slump. Dog died? Sales slump.

I worked with this client for nearly a year. We booked 1089 calls for him. Being conservative and assuming a 50% show-up rate and 20% closing rate, that should be 109 won deals (the real number is likely much higher.) They closed 89 deals, 18% less than they should’ve, and lost 6-figures in revenue. Which means I lost 5 figures in revenue.

I never want my income tied to something that A, I can’t control and B, is so unpredictable.

PIFs and payment plans

The client paid me 15% of cash collected, not revenue generated. Some months they’d only collect 15% of the revenue they generated because they enrolled so many on payment plans. That meant my client had to track rebills and we had to do a separate calculation every month for commission from those rebills. And members would miss payments or drop out of the program. Massive hassle.

No incentive to take email prospects seriously

Those calls we booked for them were free (except for their CPL.) It didn’t cost them until the prospect closed. So there was no incentive for them to:

• Put their best closers on these calls

• Optimize their follow-up to reduce no-shows

• Optimize their pre-selling autoresponders and sales enablement assets to boost closing rate

• And other tweaks to increase their dollars per booking

This wouldn’t have been the case if they were paying me a retainer + commission or I was getting paid per booking. Then they’d have had to take these email bookings more seriously.

In retrospect, I should have ended the engagement as soon as I saw they weren’t able to hit their targets 3 months in a row. But I kept thinking they’d turn it around.

Now, I’ll only consider a performance deal with a client who uses a sales team if…

• My performance pay is tied to something other than deals closed, e.g. calls booked

• The arrangement is retainer + commission

…So they’d have some skin in the game as well. But I’ll probably still say no. I prefer to charge a premium flat-fee and get on with my work. You can keep the upside. (A third option is if I book the calls AND close the deals, but that needs another article.)

Besides, only broke businesses want you to do rev-share. Rich businesses want to pay flat retainers.

About Nabeel Azeez

Nabeel Azeez is a direct response copywriter and the owner of Dropkick Copy, a B2B email marketing agency.