The Secret to Client Retention, Profitability and Scaling Your Agency

agency

As CEO of HighLevel, Shaun Clark has more than 11,000 agency customers serving more than 280,000 businesses. His goal? To help agencies grow and prosper.

The main pathway he sees to achieve this goal? Adding software as a service (SAAS) to their offerings.

Here’s a look at what Clark had to say in his 2021 Traffic & Conversions Summit talk. 

The Plight of Agencies

Agencies are the secret behind small business success, but don’t get the credit they deserve. The main problem, according to Clark?  

Scaling. Specifically, the scaling issues agencies face include:

  • Losing 60 percent of their customers per year
  • Inability to retain clients for more than 3 months
  • Inability to maintain more than a handful of clients at any given time
  • Scaling sideways

In simplest terms, agencies are unable to sustain their services in order to maintain clients and add profits. 

Two Solutions for Agencies

Clark proposes two solutions for the agency scaling problem, including: 

1. Automating lead-to-customer for clients

By automating lead nurturing takes the focus off of generating leads and shifts it to delivering what clients really want: revenue, opportunities, customers, etc. 

2. Selling services and software

Clark proposes that agencies need to move beyond selling services in order to stabilize heir futures. They also need to sell software and technology for three simple reasons: 

  1. SMBs need software to success
  2. SMB owners have no idea what software they need or how to set it up properly
  3. Agencies can be the missing puzzle piece 

Clark’s vision is simple: Instead of clients looking externally for software solutions, agencies become a one-stop-shop for both the services AND the technology. 

The potential here is underscored by two powerful data points: 

  • Agency churn rates of 60 percent
  • SaaS churn rate of 4.7 percent

The Benefits of Agencies and SaaS

In bringing services and SaaS together, according to Clark, agencies will see multiple benefits, including: 

  • Delivering more value and lower churn rates
  • Increasing profitability with a decreased cost of entry to selling products

How Does an Agency Become an Saas Provider?

All of which begs the question: how can your agency become an SaaS provider?  Clark recommends not selling services, but features they’re already buying from someone else. Examples include:

  • Two-way text messaging
  • Google business messaging
  • Text-to-pay
  • Reputation management

These low-cost, technology-driven solutions come with 98 percent profitability. The best part? If you lose an agency client, you keep the SaaS client and still come out ahead. 

Currently, most agencies see themselves as bystanders or recommenders when it comes to software and technology. Clark foresees a future in which agencies don’t just feed business to software creators; they claim it for themselves. In doing so, they not only become the direct provider of the technology their clients need — and the beneficiary of the revenue stream. 

Ultimately, this model isn’t about changing your current offerings, but augmenting them to provide valuable 360 degree solutions. 

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Bethany Cowan

I set the stage for expert marketers to connect with eager learners. Together with DigitalMarketer, our audience and attendees at Traffic & Conversion Summit get most relevant, proven and actionable techniques available. When I'm not swimming in spreadsheets or running backup batteries to our speakers, you'll also catch me hosting, emceeing, and speaking from time to time.
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