How Our Struggling Client Achieved a 556% Average Hourly Earnings Increase (And How to Properly Choose a Niche)


Niching down your service and industry can transform your agency for the better. Here’s how to do it right. 

Over the past few months, we’ve been working with a client that faced a common issue that agencies deal with. They’re a full-service agency that struggled to get all of their projects on a budget. 

The first thing we did was to see why they’d struggled with this in the past. And after going through their processes, the root cause became crystal clear. 

As a full-service agency, the client was a jack-of-all-trades. And you know what they say: 

If you try to serve everyone, you’ll please no one. 

In addition, they also had a larger team in ratio to revenue than ever before, which made the agency unprofitable.  

With this in mind, one of our priorities was for the team to start focusing on what they needed to do if they wanted to boost their hourly rate. Doing so would allow them to increase the capacity for new revenue. 

So, how did we make this happen? Read on to find out. 


The Perils of Running a Full-Service Agency 

Many agencies make the mistake of thinking that more is better in terms of the services they offer. The thinking is that by having more services to offer, the more they’ll earn from different clients. 

Except that this isn’t how it works. And our client fell into that trap. 

As a full-service agency, they struggled to become highly efficient in everything they did. But it’s just not possible to handle so many services at once with maximum efficiency. Trying to take on that many different jobs will only result in spreading yourself too thin. And that translates into generating less revenue than you could have. 

This is what I’ve seen after collecting data on 100+ agencies in the United States. The truth is that agencies that offer the most services tend to make the least amount of money. 

With this validation, our client understood the operational opportunity they had 

First, we helped them switch from the hourly billing model to the fixed-fee model. And then we helped them identify three to five core services that they’d offer. This way, we could ensure time would not be wasted and the client could focus their attention on their best work. 

Of course, it took some time to set it all up. But once we did that, the results were astonishing. The agency went from average hourly earnings of $72 to $473. By narrowing down their scope of services, they saw a 556% gain! 

This is what we’d expected to see, as it follows the overall trend.  

In a full-service agency, a $72 average is pretty typical. On the other hand, our clients that focus on a specific niche get a rate of $200 or even greater. 

That’s the power of niching down your services and finding a specific market segment. 

Knowing this, you’re probably wondering how you can do the same. So, let’s see what it takes. 


How to Choose Your Niche 

Choosing a niche might prove challenging. Some agencies go too broad, while others pick a niche that’s too narrow to work in. 

So, how do you find that sweet spot? 

First, you must understand the two primary different kinds of niching.  

You can niche down your service by focusing on what you do best and offering that same type of service to multiple different clients. Having a niche service is what our client did to see this massive growth. 

The second type of niching relates to your industry. A niche industry means you’re choosing only a particular type of business within one industry to work with. But, you can offer them multiple services. 

With that said, how do you know that you’ve niched down your industry correctly?  

It starts with answering a few key questions: 

  • What specific market segment do you want to serve? 
  • Can they afford your service and are they willing to invest? 
  • Would your work make a significant difference? 
  • Is the niche growing? 
  • Would you enjoy working with businesses in that particular segment? 

By answering these questions, you’ll gain more clarity when it comes to your niche. But perhaps it’s best to explain how it works in practice so you have a better idea of how to do it right. 

Let’s say that you want to work with e-commerce businesses.  

Some agencies believe that this is a niche. But that’s not the case. It’s a massive industry with so many subcategories of businesses. 

For this reason, you’d have to refine your target market further. Your niche industry could be women’s apparel, for example. If you do your research, you’d see that there are hundreds of thousands of businesses in that niche. That means you’ll have enough clients to scale your agency to great heights. 

Generally speaking, it’s best to refine your niche industry until you find one with 100,000-250,000 businesses. Even if you’re to only convert 1% of that, you’d still have all the clients you need to keep growing. But at the same time, you can maintain a laser-sharp focus on a particular segment. 

We recommend looking at your niche, whether niche service or niche industry, on a national basis. It’s because we live in a time where it’s never been easier to instantly connect with someone from any corner of the world, let alone a country. Your clients can be anywhere in the US and you can establish and nurture strong relationships with them. 

Finally, make sure to serve it masterfully no matter the industry. To do this, you’ll have to know every single detail about your target audience. Know their needs, wants, issues, and concerns. Dive as deeply as you can into these so that you can position yourself as an expert in your niche. Doing so will allow your agency to solve your audience’s main challenges and create value for them. 

Stay Focused 

Hopefully, you now understand why trying to be everything to everyone is so dangerous. Full-service agencies often can’t perform nearly as well as those focused on a specific niche. 

So, don’t try to offer everything. Know what you do best and who needs it most. When you create this kind of alignment, you can see incredible results. 

If you’re unsure about your niche, know that you don’t have to figure it out on your own.  

We’ve helped many agencies find their ideal market segment and drill into it. If you need help doing the same, contact us today. 

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