Which revenue models can I use to lift my agency to the next level?
Flip Keijzer, October 1, 2019
A must-have for every agency on a mission to grow is a solid revenue flow. Charging solely on an hourly basis does not help you with that. Do you struggle with how to sell your products or services? Do you have a hard time binding costumers to your company? Recruiting new customers takes a lot of time and it’s expensive. With the right revenue models, you can retain them! That’s how you create a solid revenue flow.
Pretty much every product and service connected to WordPress can be sculpted into a subscription package. A website is not an end product. They need maintenance, have to be optimized or new features need to be implemented. There will always be a moment where your client needs your help again. When customers enter into a subscription they will assure themselves of your products or services for a longer time.
Your customers will of course not enter a subscription model lightly. You will need their trust. A lot of subscriptions offer a trial period. Subscriptions also need to be financially beneficial in comparison to a series of single purchases. The cost of a subscription will be put together with the knowledge that your customers will stay with you for a longer period of time. There are no further customer acquisition costs involved among loyal customers. Therefor your profit margin will increase every time a new client subscribes.
Premium or Pro model
This revenue model is tied to the subscription model. It focuses on getting an even stronger bond with your clients. With an upgrade of their subscription clients can get extra features, services or products. By offering PRO of Premium packages you can cover these needs. Some of your clients have a small budget and can enter an entry-level subscription. Those in need of more, can upgrade their subscription. For those higher-end subscriptions you can, of course, charge more. Obviously your high-end customers will also demand more in return. As long as you keep them satisfied and provide good service your revenue will grow.
The strategy for this revenue model is that you lower the bar for engagement as much as possible. First, you sell a low-cost base product. Together with this base product a consumable product is used sold. A classic example is the Gillette razor blade. Gillette sells its shaving handle for a low-cost price, bundled with the first consumable. After using the first blade, you will need new razor blades. These razor blades, that make the product actually function, are sold at a profit. For website builders and agencies a website can be that base product. Especially if you build a website with a self-made framework. Shopify is an example of such a web site. You sell a low-cost platform and gain revenue by offering maintenance, hosting, personalization and support.
For small companies, it’s often expensive to get a new website build. As a solution, you can offer one for lease. You can offer a complete stress-free package. As an agency, you will build the website, arrange the hosting and include maintenance and optimization. For this package, you charge the client with a monthly fee. As a result, your client will have his own stress-free website at a reasonable price without going into debt.
A lot of agencies have their specialism. Customers however, often want a single company to take care of every aspect of their website. To cater to this wish, you can work with other specialized companies to assemble a more complete package. By reselling products you stock-buy them from other companies and put them in your offers. Once in your subscription package, you can sell them at a profit margin. This will generate profit for you and you’ll be able to offer potential customers a more complete and better product.
We hope that some of the content in this summary has inspired you. If you struggle with how to sell your products, get creative! Whatever model you choose, there’s a lot of options out there. Perhaps you can even combine multiple revenue models and create one of your own.