The service industry is facing the biggest blow during the COVID-19 pandemic. This is in sharp contrast to earlier recessions where manufacturing was the first to take a nosedive. A record 659,000 service jobs were lost in March alone. This is why if you make efforts to productize your services, you can boost revenue and keep your business thriving during the pandemic,
The other reason why productizing services is helpful is it enables entrepreneurs who are stuck because they simply cannot take more clients on a one-on-one basis. This means they have hit a ceiling when it comes to the number of clients they can take on at any one time as well as the maximum revenue they can make from their business. This is where productizing their services come in. It enables them to shift from a linear to a leveraged source of income. What this means is that you get paid many times over but you only do the work once. There has never been a better time for service businesses to learn and grow by productizing their business.
Let’s back up… What exactly is productizing? When you productize your services you are selling a service that is packaged. But how can a service be offered in a package? Here are five ways to make sure your package your services to generate more sales during uncertain times.
1. Package Part of Your Service In a Certain Niche
As a service business, a lot of time goes into generating leads and later revenue. But a lot of the leads may not lead to potential customers. Building a smaller scalable product helps in the long run to generating high paying potential customers. A customer who buys your smaller version is far more likely to buy your higher-priced services as well.
You could sell anything — a book, a webinar, or a course. It is important that it is of high quality and shows your customers what they can expect from your more expensive services. Some examples:
- Jane Portman, A UI/UX consultant who runs UI Breakfast offers an eBook, a UI course, and a consulting guide which helps her market as well as build trust and generate leads.
- Scribe, a book writing company helps customers to write, edit, ghostwrite as well as publish their books. It also has an impressive productized business model that helps them scale and leverage their business.
- SEOak, an SEO company does not list their prices online. They have an online form where customers can contact them to get the pricing. This shows the remarkable flexibility of productization. By streamlining the service, you save time spent traditionally on consulting, negotiating, and then figuring out that the customer is not looking for the services you offer.
When you productize, the customer immediately knows what you offer, the price and gets an understanding of how you operate based on his experience with your smaller product. This saves everyone a lot of hassle.
2. Offer a One-Time Purchase Where Applicable
Certain services are only used by people annually or maybe once in six months. Examples include webpage design, landscaping, etc. The key here is to productize your services to build a tier of products. Start with the minimum engagement product. This could be providing a basic set of services. Then package a mid-tier service which are higher-priced with added functionality and which provides more value. Finally, provide a package that is an all-inclusive package that goes beyond the last tier.
In this way, your basic projects are productized and require less personal involvement after the initial process leaving you time to spend with your highest paying clients.
Data Stories is an example of a tiered productized approach wherein they offer different packages based on your company size, the amount of data, and so on. This helps them streamline their customers and spend time on the bigger custom projects.
3. License Your Products
In service businesses such as photography, music, illustration, etc. creating products that permit you to sell licenses rather than exclusive access to the product itself. Examples would include licenses for music, scripts, plugins, cartoons, typefaces, etc.
Cartoonist Mark Anderson licenses cartoons individually, has a service for custom drawings, and also has a subscription service. This not only helps bring in a constant stream of revenue, but it also does it with less work than a one-on-one basis.
4. Sell Templates
This is very similar to licensing but here you sell templates which the customer can then modify according to their need. This enables a passive stream of income for a long time. However, the more modification a customer requires, the more support you will have to provide.
Examples: Themeforest sells website themes, and Graphicriver sells graphic templates online.
5. Offer a Monthly Subscription
This is most often useful when you productize a service that customers need to use over a long period to get viable results. This is often the case with blogging, email marketing, apps, etc. It is very similar to SaaS ( Software as a Service) which is hosted online and requires a subscription. This method is most useful for a regular revenue stream and helps you predict your future income. The tiered approach works here as well.
Consider these examples:
- Bench is a bookkeeping service that has a four-tier subscription plan for anyone in need of their services.
- Design Pickle is a design company that offers customers a dedicated designer for a monthly subscription of $399.
- Nusii, a proposal creation software, has a monthly subscription based on the number of proposals and the features a customer desires.
6. Make Sure to Follow Up
Following up after the client purchases shows that you care about the business and also allows you the opportunity to sell more of your services. This could be done via email at regular intervals. It is also important to get valuable customer feedback from the clients you work with. An online form is the easiest way to gather data and make valuable interpretations from it.
An important advantage to productizing your business is that several tasks become routine and predictable. This enables you to hire people to help you to run and grow your business; whereas before there was no way to ensure predictability since every project was different and required you to be hands-on. It also leaves you with free time to brainstorm and take your business to the next level.
Businesses need levers to move forward. In a service business, you have to work to create your own. By productizing your services, you can leverage and scale your business.