I have a team of amazing podcast producers from One Stone Creative. One of the founders, Megan Dougherty, often sends me topic ideas for this very podcast. Because she also runs an agency, she has many of the same questions we all have and she provides me great fodder for thought. One of the ideas she sent me was a discussion about how to provide different types of services—at different price points—for many different clients.
Offering different priced services for different sized organizations. It’s not as easy as it sounds. Like many entrepreneurs, I started my business thinking I could scale by offering communications services to small businesses because they’re underserved. Well, there is a reason for that: it’s incredibly challenging to scale a business on $500-$1,500 per month retainers. You can only hire junior-level employees and they’d each have to service 20 clients at one time. If you had one weekly meeting with each of them, you’re at 20 hours a week, just in meeting time, not to mention all the work you have to do.
Not to say it’s not possible, but it’s extremely challenging. That’s why, rather than try to be all things to all organizations, it’s important to figure out the right pricing model for your business (or, in this case, agency) and then how you might be able to package things for the clients that can’t afford your “done for you” services.
Chip Griffin and I had a similar conversation to this last July on the Agency Leadership podcast. We decided there are eight types of pricing models to consider:
- Billable hours
- Buckets of hours
- Fixed-fee retainers
- Productized services
- Points based
And that, my friends, is what we discuss on this week’s episode of the Spin Sucks podcast.