Imagine starting the beginning of each month with a predictable amount of income already in your pocket. Think about what that would do for your stress level. Marketing is so much easier when you’re not stressed out about how you will get to a certain amount of sales by the end of the month. A web design and SEO business can be very profitable, especially when set-up and run correctly but it can be even more profitable when streams of recurring revenue are introduced. If you’re feeling constrained by one-time hourly or project based work, it’s time to explore some recurring revenue streams.Digital agencies are starting to get smarter and we can see a tremendous shift from traditional revenue sources to a business model that focuses more and more on recurring income streams. After all, continually looking for new clients can be difficult, exhausting, and expensive.If your company has not yet considered the possibilities of creating a recurring income business model, you are passing up on a huge opportunity to bring in more revenue for your business. If you’re not sure where to get started, don’t worry, I’m going to give you several options here.In this post we will tackle:
- The major problems with hourly and project-based pricing
- The benefits of incorporating recurring revenue streams into your web design and SEO business
- Your options for recurring revenue opportunities
The Problem with Hourly and Project-Based PricingThe income generated by companies through time-based billing models has steadily declined by over 40% in the past two decades. This isn’t overly surprising as these time-based billing models confine a company’s income to the number of hours they work. If you want more income you have to put in more hours, but that can be expensive in the long run as that time is divided between actual client work and finding new clients. Companies that find a way to incorporate one or more recurring revenue streams have an easier time sustaining and growing the company.Aside from the revenue constraints, traditional billing models also have the issue of costly client acquisition. Finding new clients translates to bigger expenses as marketing and time cost money. On top of that, it can cost a company 6 to 7 times more to find a new customer compared to selling to an existing one. Read: it’s less expensive and time consuming to spend your time selling to your current clients.The biggest problem perhaps with hourly and project-based contracts is that the income flow is unpredictable. The revenue can vary greatly from one month to the next.The Benefits of Recurring Revenue in Web Design & SEOWhen your company has a predictable and steady source of income, less time is spent on worrying about finances, costs, wages and even worker performance. This means more time is spent on client satisfaction and in growing the business.The predictability of recurring revenue helps you to ensure you have the right team members in place, improve services and develop quality and long lasting relationships with clients. A recurring billing method also allows you to give clients more flexibility in the services you offer and more importantly, it encourages loyalty to your products and services.Lastly, recurring revenue gives you more time to focus on the creative process. Instead of worrying where you will get your next project, you can focus more on improving your services, building innovative marketing strategies, and providing creative solutions to meet the needs of your clients.Options for Adding Recurring Revenue to Your BusinessI’ll assume that you like the idea of adding recurring revenue to your business since you’ve ready this far. So let’s look at your options for doing exactly that.SEO servicesSearch engine optimization (SEO) services such as keyword research, link building, content writing and optimization, and site audits are some of the most sought after digital marketing related services these days. It has been projected over 90% of companies need SEO services. After all, what company doesn’t want more clients?Options for providing recurring SEO services include: monthly recurring SEO (link building, new keyword rankings, etc.), selling SEO leads and renting websites to clients.Content creation and developmentOffering subscription based content creation services is also a good way to create recurring revenue streams for your company. Many companies need help with creating blog posts, newsletters, press releases, and video content.Content is very important to a solid SEO strategy but many companies don’t have the time to produce regular and quality content which means they either don’t do it at all or they outsource the work.Digital MarketingDigital marketing can involve social media marketing and management and email marketing Email marketing typically involves generating more leads for your clients by creating profitable email marketing campaigns.Social media marketing, on the other hand, may involve analyzing client’s current social media marketing strategy and creating a comprehensive social media campaign with the ultimate goal of improving your client’s online reputation, presence and sales.PPC managementWtih PPC management you can help a client generate new leads and sales quickly. Carefully executed PPC campaigns can be quite profitable for business owners and this is often a good strategy to use in combination with SEO, especially while waiting for organic results.Analytics reportingWhile Google Analytics is free of charge, setting it up and maintaining it remains an intimidating task for many clients. You can usually set up client analytics accounts for a one-time fee and you can offer to handle their analytics reporting on a subscription-based arrangement. Interpreting analytics data is time consuming and many business owners are willing to pay agencies that can do it for them. Understanding web analytics can make a huge impact on a business’ revenue as it helps them to make improvements based on the behavior of their site visitors.Marketing servicesSome customers look to outsource all of their marketing activities to a reliable provider rather than hiring someone in-house who they would need to train and support. A full service marketing package can include many of the options covered here.Web design subscriptions, maintenance or upgradesWhile both clients and providers may think one-off web design projects are more convenient, research has shown that monthly web design maintenance and upgrades are more cost-effective in the long haul. It’s important to create attractive packages that include tasks that clients cannot do themselves or do not want to do that could have a large impact on their business. This could include content additions, monitoring for security issues, site updates, site backups and so on.Web hostingWeb hosting is such an inconvenience for many business owners because they usually don’t understand the terminology or how to piece everything together. It doesn’t take much selling to convince clients (especially web design clients) to sign-up for hosting with your company so they can keep all of their services under one roof. This means they have reliable hosting and more direct support they can easily access.Tech support & consultingSome companies like to do a lot of their own work but still need some help. Providing technical support or consulting services gives these clients the opportunity to work directly with you on web maintenance issues. If you have other computer skills this can be added to your list of support services as well.DIY trainingIf you’ve been in business for even a little bit, you’ve likely come across a client who wanted to hire you but didn’t want to pay what you were asking. In the beginning of business (or when you don’t have a lot of work in the pipeline) it can be tempting to lower your prices. This often ends badly with either the client being unhappy or you being unhappy. One option is to provide lower-priced products for these clients. The benefit here is that it allows clients with a lower budget to access help and it gives clients with higher budgets the opportunity to learn and see your expertise before hiring you for a more expensive service.These products could come in the form of video tutorials, ebooks or even worksheets and templates that can be sold and accessed from your website.Where to startI would recommend starting with one recurring service at a time as it does take time to put a new service together and market it to existing clients. This will allow you to focus on the quality of the service you put together and once you have a solid grasp on selling the package and producing good results, then you can consider an additional recurring service. It can be very overwhelming to add multiple services simultaneously which can result in lower quality and sales.As you can see, there are many options for adding recurring services. It’s time to strongly consider shifting from one off projects to subscription based services that can guarantee more steady income for your business. You’ll certainly enjoy decreasing your expenses, increasing the amount of available time you have, increasing your profits and giving your more time to focus on other aspects of your business (without all the added stress).