Are you considering freelance work as a product designer? Or, are you already doing freelance work on the side but afraid to take the leap and go all in? Last option is, you are already running a design service business the classic way, and you're familiar with the ups and downs of revenue streams. One month, you might have more clients than you can handle, while the next month is a wasteland.
It's a common problem, but one that can be solved with a little creativity. Let's talk about productized services!
We'll cover:
- What exactly is a productized design service with specific examples?
- How do you build your own?
- Does it have to scale into an agency?
What exactly is a productized design service (and examples)?
Productized services are standardized services sold like products, with clearly defined parameters and pricing. By outlining precisely what a customer will receive and at what price, you can market and sell this "product" many times over and with more predictability.
Examples of productized services
A great example is Humbl Design, who I had the opportunity to chat with. David created a design retainer package of 5,000 per month with maximum availability of 5 clients at the same time. It's a great way for him to predict revenue, and workload.
David for example, justifies his price, by comparing with the cost of hiring several position full-time to replace the tasks he covers. Essentially, he covers senior product designer position, which average salary is $120,000 plus benefits & overhead costs (in the US). Humbl design offers the same type of work for $60k a year, which is approx. 46% less with the freedom to cancel anytime.
Productized services can come in many different forms. Some examples include marketing services, content creation services, and web development services. For example, Daniela launched a content marketing service called Scribly in 2019 and reached 30k/month in revenue. You can read more of her story in this interview.
Difference Between SaaS and Productized Services
Even if it is "packaged as a product", a productized service is still about selling your time just like freelancing. A SaaS, is a product that's completely detached from you as a person, and can be sold indefinitely. A productized service business does not make money when you go on vacation or if you get sick. It is also probably harder to sell a productized service in the future if it is based on one person's skillset.
How to you build your own productized service?
Productizing your services can be a great way to streamline your business and offer a more predictable experience to your clients. Here are some strategies to consider when creating a productized service:
1. Define Your Ideal Client and Reach Out
Before creating a productized service, it's important to have a clear understanding of your ideal client. Who are they? What are their pain points? What are their goals? By understanding your ideal client, you can create a productized service that meets their specific needs and provides a solution to their problems. For example, you could offer services mainly to early stage B2B companies, only gaming companies or creators.
2. Create a Package Offer and Pricing System
Creating a tiered pricing system can be an effective way to offer different levels of service to your clients. For example, you could offer a basic package, a premium package, and a VIP package. Each package could offer different levels of service, with the VIP package offering the most comprehensive service. For example, Humbl Design has a package for Sync, and Async work. DesignJoy has a standard pricing at $4,995/m and a pro pricing at $7,995/m. The first offers one request at a time while the other offers two requests at the same time.
This video breaks down how Design Joy built he charges for the service:
4. Sales and outreach
A fun way productized service owner find clients, is to identify opportunities through job boards, including WoodyJobs.com, and offer services instead of applying. Smart!
You can also use sales tools like Apollo.io to do sales outreach at a bigger scale. Ultimately, you operate like a product business, so you can steal a lot of tips from their sales and marketing techniques. Only difference is that the product is you!
5. Focus on Recurring Revenue
One of the key benefits of productizing your services is the potential for recurring revenue. By offering a service that clients need on an ongoing basis, you can create a reliable stream of income for your business. Consider offering recurring services, such as monthly maintenance or ongoing support, to keep clients coming back. DesignJoy offers a webflow maintenance for example.
Does it have to scale into an agency?
Daniela, founder of Scribly, chose to hire, and delegate client work to her team quickly. But you can design your business to operate it solo as well.
Bret from DesignJoy writes this in his FAQ: "You might be surprised to hear this, but Designjoy is actually an agency of one. This means you'll work directly with me, founder of Designjoy."
If you enjoy the slow company building, and company of one trends, you can build a productized service on your term. One of the learnings from experienced freelancers like Paul Jarvis, author of Company of One, is that you can design your freelance/business activity so that it reaches your "enough" annual revenue.
But it's not only about revenue. Defining your "enough" can mean that you can operate your business 100% solo with a specific number of clients per month, no less, no more. You don't have to scale into an agency with team members.
If you're looking for more help to build your own productized services, check out Design Joy's founder course Productize Yourself.
Conclusion
So, are you ready to systemize your approach, and build a sustainable design freelance business? Yes, I'm here rooting for you, let's do this! In the meantime, feel free to use Woody Jobs to help you narrow down your target niche.
