How To Turn An Agency Into A Digital Product Business
Reason #94 why agencies are the best businesses to start.
As much as I talk about how great agencies are, I’m also under no illusions that they are the perfect business model.
Agencies lack scale.
One way to add scale to an agency is to create programs and products that attach to your core services. This builds an ecosystem that expands your ICP and gives you different offerings to meet people where they are.
Today, I’ll break down the process of turning your agency into a product business so you can scale and make more without doing more.
LFG. 🔥
The Three Things You Can Sell In Online Business
In a world of endless options, there are still only three types of offers.
There are …
• Services
• Programs
• Products
A service is self explanatory. People pay you to perform a task. This has the benefit of low cost to entry but the downside of limited scale. You can’t create more hours in the day, so to make more money you need to either hire more people or charge more.
A program sits between a service and a product. It introduces scalability but still requires your time.
An example of a program is a membership site, a cohort, or even a directory. These are replicable but still involve some of your availability.
Products are the most scalable and profitable of the three, but they also have the lowest chance of success. For example, you can run a service and charge $5000 a month with two customers and have a solid business. But to make real money with products, you need volume, which usually means a big audience.
So how do we combine all three?
The Offer Funnel
An offer funnel is a system that lets you sell high revenue services, time leveraged programs, and infinitely scalable products.
Here’s how it works, using examples from Juliana’s business.
Step 1 - Start with a service
If you can build a service business, you get paid while growing your audience.
A service business doesn’t have to be an agency. For example, Juliana runs a breathwork business and started with services. She hosts one in person event and one online event per month. This is trading time for money, which defines a service.
Events are high revenue but low leverage. The only way to scale is to sell more tickets.
However, the have the added upside of growing her brand, creating income to run ads to grow her email list, and present a model to help break even while she builds her YouTube channel and her newsletter.
Step 2 - Break your service into a program
After delivering a service for a while, you’ll start seeing patterns.
You’ll notice common problems your customers have and opportunities to turn those into programs that use systems or software as leverage.
Juliana is building an 8 week breathwork and microdosing program. It’s a cohort format. She will guide a group through a program that helps reset the nervous system and break harmful patterns.
A program is in between a service and a product. It still requires her time and her availability but it has much more scale because a lot of the information and benefit delivered can be done by the customer.
Step 3 - Chop your programs into products
As you run your programs, you’ll uncover even more specific problems your customers want to solve.
Eventually, Juliana will create specific courses like a 30 day breathwork reset, a 28 day morning routine, or trauma focused programs.
The best part is you don’t need to guess what people want. If you’ve built your service and program first, your audience will literally tell you.
You get paid to do market research.
It All Starts With The Service
I talk to a lot of entrepreneurs through my membership, social media, and Substack. One pattern I see constantly is that people want to create courses and products right away.
That’s a mistake.
Yes, some people pull it off. But the odds are low.
If you’re starting out, you probably don’t have an audience or reputation yet. Building your agency helps you build both.
Patience is everything. If you can delay gratification, you can build a system that solves problems at every level of the funnel.
When you combine your offer funnel with a media machine, you can’t lose.
This is the highest probability path to success and wealth.
Be patient. Be consistent. Stick to your vision and you will win.
Love you guys. Talk to you tomorrow.
Tim
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