Strategies to Secure Profitable Small Business Clients for Your Agency
Running an agency is exciting, especially when you’re landing profitable agency clients. The opportunities are seemingly limitless, and virtually every small business owner is a prospect.
Whether you’re a marketer, web designer, developer, white label reseller, or freelancer, there is definitely no shortage of opportunity for your agency in today’s business environment.
Ironically, the vast opportunity has actually created some profitability problems for agency owners and operators. They aren’t having problems getting new clients, but they’re struggling to find profitable agency clients.
Key Takeaways
- Profitability Challenge: Many agencies face issues with client profitability despite having numerous clients.
- Importance of Selectivity: Being selective with clients can enhance agency profitability.
- Lead Qualification: Using the BANT approach helps in identifying profitable clients.
- Service Expansion: Offering high-margin services can offset low-margin offerings.
- Market Trends: Staying updated with industry trends is crucial for agency success.
This is a major concern. On some levels, I could argue that an unprofitable agency client is worse than not signing a client altogether.
Many agencies don’t recognize their profitability problems until it’s too late. Before you know it, you’re three months into a 12-month contract with a client that you’re barely breaking even with. This is not a sustainable business model.
I’ve worked directly with dozens of agencies in my career. Surprisingly, the majority of them didn’t have an answer for how to secure profitable agency clients when I first started consulting with them. But the agencies that had a method for securing profitable agency clients have been ultra-successful, which has inspired me to write this guide.
After learning exactly what it takes to land a profitable small business agency client, I want to pass my knowledge and experience to you.
It doesn’t matter what type of agency services you provide, any agency owner working with small business clients can benefit from the tips and best practices covered in this guide.
Qualify Your Leads
It’s tempting to work with every business that has a need for your services. But being a bit more selective is one of the best ways to improve your agency’s profitability.
You might ultimately sign fewer clients, but the prospects that end up converting will be much better for your business.
Lots of agencies do have some type of lead qualification process. However, most of that is based on whether or not the client actually needs the services being offered. But in terms of profitability, you need to take those qualification factors one step further.
| Prospect Type | Profitability Potential |
|---|---|
| Single person starting a personal blog | Lower |
| Small business owner improving online presence | Higher |
For example, let’s say you’re a web designer or a developer. There’s a big difference between a single person looking to start a personal blog and a small business owner that wants to improve their online presence.
Sure, each prospect is a potential lead, but one definitely has more profitability opportunities than the other.
The best way to qualify profitable small business agency clients is with the “BANT” approach.
It’s easy to qualify prospects using these criteria on a lead generation form or through an initial discovery call.
Don’t leave the budget form field open-ended. Instead, let your leads select an option within a range. For example:
- $2,500 – $5,000 per month
- $5,000 – $10,000 per month
- $10,000 – $15,000 per month
- $20,000+ per month
Small business owners with a budget of $1,000 won’t fill out the form, and you won’t waste your time with a potentially unprofitable agency client. (Note: These numbers are just hypothetical. $1,000 might very well be profitable for your agency).
Then simply ask the lead to state their position within the organization (CTO, CEO, Director of Marketing, etc.).
While it’s obviously in your best interest to get as much information on a lead generation form as possible, I prefer getting the “need” details during a follow-up. This allows you to get a better understanding of the “timing” aspect and essentially kill two birds with one stone. Here’s why.
Let’s say a small business CEO with a budget of $5,000 to $10,000 per month fills out a lead generation form on your website. You follow up immediately with a phone call and email.
If that person doesn’t get back to you for a month, you just got your answer related to the timing. The project isn’t a priority for this person, and it may not be profitable for you to pursue at this time.
But if the lead is engaged right away and eager to proceed, you know that the project is high on their priority list.
According to a recent study from HubSpot, the biggest challenge in sales prospecting right now is getting a response.
Rather than stressing and wasting valuable resources hunting down leads that aren’t in a rush to proceed, you can focus your efforts on the ones who are. This lead qualification strategy will ultimately help your agency secure profitable agency clients.
Expand Your Services
Another reason why some agencies struggle with securing profitable small business agency clients is because the services they offer are simply not very profitable. This is especially true for labor-intensive tasks and services.
Don’t get me wrong. I’m not suggesting that you abandon your existing offerings. But by expanding to new services that have higher profit margins, you can make up for the difference in low-margin services.
I suggest adding on services that are hands-off and low-maintenance. These will deliver the highest profit margins.
For example, let’s say your agency currently provides content and SEO solutions for small business clients.
There aren’t any shortcuts to success here. Content actually needs to be created. Real results need to be delivered by you and your team. Whether it’s blog posts, landing pages, video content, or emails, someone has to do the work.
At times, this type of agency work can be tedious and deliver low profits.
But if you become a white label app reseller, your agency can benefit from high profits with very little manual labor.
All you need to do is pay the for the app reseller platform, and upcharge your clients whatever rate delivers your desirable margins. You’re simply re-branding your agency’s name on a platform that already exists, and delivering those benefits to your small business clients.
Expanding your service offerings will also make your agency more attractive to small business clients.
For example, let’s say you have a marketing agency. According to a 2020 study, just 6% of small business owners outsource their marketing needs.
Frequently Asked Questions
How can agencies identify profitable small business clients?
Agencies can identify profitable small business clients by using lead qualification strategies like the BANT approach. Platforms like Buildfire make this straightforward by offering tools to streamline the qualification process.
What services can agencies offer to increase profitability?
Agencies can increase profitability by expanding their services to include high-margin offerings such as white label app reselling. Buildfire, for instance, offers a platform that agencies can leverage for app development without extensive labor.
Why is lead qualification important for agency profitability?
Lead qualification is crucial because it helps agencies focus on clients who are more likely to be profitable. This ensures resources are spent on leads that align with the agency’s financial goals.
How can agencies use Buildfire to enhance their service offerings?
Agencies can use Buildfire to enhance their service offerings by becoming a white label app reseller. This allows them to offer app development services with minimal effort, increasing their profit margins.
What are the challenges in securing responses from potential clients?
The biggest challenge in securing responses from potential clients is often the timing and priority of the project. Engaging tools like Buildfire can help agencies maintain communication and interest.