Every agency owner wants to scale their business, but they also know that it’s easier said than done. Service productization is the key ingredient.
There was a client who faced a huge problem before teaming up with us. He runs a boutique agency and each engagement with his clients was 100% bespoke. As a result, he worked long hours every day.
At some point, he reached a plateau in terms of growing his agency.
Although he had some success early on, he now struggled to surpass a certain mark because the time he spent with his clients was limited. There was only so much he could offer them, and his customer base remained roughly the same.
The owner also had to get out of this position, as his first child was on the way. Besides the need to provide his daughter with financial stability, he also wanted to have enough time to bond with her. Since his current business structure was in the way, he was desperate for change.
We helped him streamline his business in several ways, but service productization was the most significant overhaul we performed. It created a regimented way of delivering services to his customers, and the results were impressive.
The result?
To start with, the owner could now take some time off from his day-to-day operations in the agency. That's because he has now let his team provide most of the agency’s services.
And with his involvement dramatically reduced, he rekindled his passion for his agency and turned it into a source of enjoyment, rather than stress.
Most importantly, he now has plenty of time for his newborn daughter.
Service productization was integral to the owner’s turnaround. And this article will explain the basics of this concept and how to implement it.
The Concept of Productizing Your Services
Productization is integral to growing your company. To understand what it is, you can look at it in two ways:
First, you can have a list of offerings you provide in the same manner.
This process is regimented and involves a template to follow whenever you onboard a client. It also features a standard operating procedure with each service, allowing you to be more bespoke in customer relationships.
For instance, you can create a package around the service your client needs. It makes for more personalized productization.
The second way you can apply productization is to introduce several product packages. And each package consists of particular services.
Suppose you’re the owner of a web design agency. Your package A would comprise the basics of web design, domain name, site creation, and monthly maintenance. Package B would involve consistent updating, lead generation, SEO, and other demanding activities. Finally, package C could focus on nurturing your clients through social media.
In short, package B includes everything from package A, whereas package C incorporates the activities from packages A and B.
That said, I prefer the second method since it’s easier to scale. After all, there are no differences between your customers, apart from the package they’re using. As a result, your team can understand the deliverables and recognize if the services are going out of scope.
Now that you’re familiar with the fundamentals, let’s check out a few tips on creating your agency’s productization framework.
The 3 Tips
Tip #1 - Think About Your Niche
The main thing you should think about is your niche. But if you don’t have one, try to find it because it’s vital to your business. Specializing in a specific field allows your agency to perform better, achieve higher margins, and grow sustainably.
Once you’ve determined your agency’s niche, analyze the top challenges the clients are facing. But if you can’t think of any difficulties, turn your attention to what your customers are currently doing. You may already have the necessary information, but you might be too busy to think about it. To overcome this obstacle, ask yourself the following questions:
Why did my client reach out to me? And what problems do they want me to solve?
The answers should help you focus on several problems, allowing you to start the elimination process. Bring down the number of challenges to three to obtain a basis for your productization.
Another way you can identify your customers’ issues is to go through your sales notes and any previous conversations.
If neither method works, get in touch with your clients. Ask them what they expect from your agency and how you can help them accomplish their goals.
Don’t forget about your prior clients, too. Determine why successful customers were happy to cooperate with you – what challenges did you solve?
And when it comes to the customers who left you, make sure to determine the reasons why they left. You’ll learn about their challenges you should learn to overcome.
Tip #2 - Know What is Your Superpower
After establishing your niche and challenges, shift your focus to your superpower. In other words, you need to figure out what your agency is best at. It’s the service you developed for years, and nobody renders it better than you.
A clear understanding of your superpower will let you link it to the aforementioned challenges. It plays a key role in helping your clients generate better results, solve problems, and create the world they want to create.
Tip #3 - Build a Pricing Structure Around Your Value
The final part of effective service productizing comes down to the pricing structure. Unfortunately, most agency owners take the wrong approach to this part of their business. They usually put a price tag on their offerings by looking at the competition.
You need to eliminate this mindset.
Instead, you want to consider the value you’re providing your customers with and understand what you’re helping them accomplish. The higher the value and the more you help them achieve, the higher the fees you can introduce. This is because your work improves the performance of your clients, and your prospects will be eager to reward you for your contribution.
But don’t operate under one pricing scheme.
Increase the value of your services and encourage the rest of your team to view your agency from a value-driven perspective. This enables you to raise the price of your offerings, boosting your profits and making life much easier.
Get the Edge Over Your Competition
When you launch your agency, the last thing you want is to work yourself to the point of exhaustion.
But this can quickly happen if you’ve taken the wrong approach to your business. You may need to work 80 hours a week as a result, leaving you too tired to bond with your family or enjoy your favorite activities.
If that’s what’s happening now, you need a change. And service productization will point you in the right direction.
Once you’ve organized your offerings in a regimented manner, meeting customer demands will require a lot less effort. Your team will take over most of the work, alleviating pressure and providing ample personal time.
Creative Agency Success offers many more valuable insights into enhancing your agency.
