There are lots of ways of bowing out of a competition. We do our best -- as in, "I'm sorry, we are going to pass on this opportunity because we are stretched thin right now and need to focus on the opportunities at hand." Or, "We are concerned that your scope is more ambitious than your budget. Thanks for thinking of us."
As a noted agency consultant likes to say, "An agency that stands for everything stands for nothing." So we do a decent job of taking our stand and making the tough decisions.
For instance, just last week, we decided to pass on competing in an RFP. The client prospect called me back a few hours later and asked me to go to breakfast. Over eggs and bacon, he proposed several reasons why we should compete. I was surprised, and ultimately proud, that he wanted us in the competition so badly. (You see, it's pretty easy to stroke the ego of an ad guy. Just praise us. Tell us how much you like our work. And we fold like a tent.) To our surprise, we dictated the terms in which we would compete. And they agreed. So we're back in. It's not easy saying "No."
Then there was the client who wanted to give us his account. Literally. No competition. It was in a sector that is not a specialty of our agency. And we have never succeeded in this sector. My management team discussed it, applied the vetting criteria, and voted "No." Of course, I had the pleasure of delivering the news. The client understood, even though he regretted our decision. He also asked me to reconsider. In case we didn't, he asked me to recommend other agencies. I recommend competing agencies almost every week. But this account carried a seven-figure budget, and they wanted great work. Plus, there was no competitive pitch. Do you know how hard it is to give away a multimillion-dollar account? Try it one day. It's even harder to say "No" twice to the same client. But I did.
Then there's the client who asked us to pitch, although we didn't have any relevant experience. Actually, this kind of client calls often. And when we tell them "No" and explain that we don't have experience in their category, 75% of the time they tell us that's not important. Occasionally we'll jump in. And the client winds up choosing an agency based on their category experience.
We say "No" a lot more often in instances like this.
When you own an agency, and have a big payroll, rent, benefits, taxes, IT infrastructure, and a thing called profit, saying "No" is hard. But sometimes you have to do it. Even a second time.