Are you tired of constantly hunting for new clients?
While one-time projects can keep your agency afloat, creating recurring revenue streams is the key to long-term success and growth.
If you’re wondering where to start or how you can build out a system that keeps money flowing in, we’ve got you covered.
We’ve compiled a list of 12 ways to create recurring revenue for web agencies. We’ll also look into how you can make the most out of your recurring revenue strategy.
But first, let's recap the basics of recurring revenue.
- What is recurring revenue?
- How to create recurring revenue for your web agency
- Tips for a successful recurring revenue model
- FAQs about recurring revenue for web agencies
- Final thoughts: Recurring revenue for web agencies — a blueprint for success
What is recurring revenue?
Recurring revenue is a portion of your business’s revenue that’s predictable and stable (i.e., the income you expect to earn continuously). In a recurring revenue model, you provide clients with ongoing access to a product or service for payments made at regular intervals (e.g., monthly or yearly).
Put another way, rather than clients paying a one-off fee for your product or service, they commit to paying for it on a long-term basis. The key is to encourage customers to keep doing business with you. This way, you won't struggle to find new clients after completing a one-off project.
Many advantages come with a recurring revenue model, including:
- The ability to forecast future sales (which brings peace of mind).
- A high customer lifetime value (CLV).
- Reduced marketing costs since you’ll spend less time looking for new clients.
- A better understanding of your customers' pain points.
- The ability to reinvest the money you make to grow your business.
How to create recurring revenue for your web agency
There are many ways to create recurring revenue for web agencies. Your options include everything from reseller hosting and maintenance packages to search engine optimization (SEO) and social media management.
While considering your options, you can add new services to expand your offerings or, better yet, offer recurring services that complement what you already offer your customer base. Either way, your aim should be able to increase your clients' spending so you can meet your revenue goals.
Offer consultation services
Many businesses need help to build a strong online presence. Whether a website is new or has been around for a while, something can always be improved. So, a consultation program is an excellent way to create recurring revenue for your agency.
Schedule weekly or monthly consultation calls where you can discuss and make recommendations on things like:
- Web strategy.
- Brand positioning.
- Lead generation/website conversions.
- Marketing strategies.
Use channels available to you (like an email list) to promote your ongoing consultation service. For example, offer a discount to the first five clients who book a consulting session with you.
For clients whose websites you’ve just completed, you can recommend ways to keep their websites in tip-top shape.
And this brings us to our next point.
Become an affiliate
Besides offering consultation services, another good way to create additional revenue for your business is to become an affiliate.
The idea is to promote a tool or service that can be helpful to your customers. You’ll earn recurring affiliate commissions every time a user signs up.
Do your due diligence to ensure the program you sign up for is worth recommending to your clients — only put your reputation at stake for a tool or software that’s worth it.
For example, Nexcess has a noteworthy hosting affiliate program.
You can earn as much as you want because your referral income isn’t dependent on the number of referrals you get. Instead, you get paid $150 or 150 percent of each sale.
The program uses cookie-based tracking that lasts for up to 90 days. And you even get access to promotional materials to help you maximize conversions.
The best part? It’s free to join.
Offer reseller hosting packages
Offering reseller hosting packages to your customers allows you to earn a sustainable income. After all, anyone with a website or planning to get one needs reliable hosting services.
As much as recommending web hosting to earn a commission is worthwhile, creating and selling web hosting packages yourself can be more profitable.
That said, selling hosting isn’t without its challenges. They include:
- Managing multiple clients (which can be time-consuming).
- Maintaining top-notch customer service/technical support.
- Optimizing performance.
And if the hosting provider isn’t reliable, your clients might lose trust in your offerings and churn.
But there’s good news: Nexcess offers fully managed hosting, so you can focus on high-level tasks. The agency partner program includes backend administration, client support (with fast response times), and frictionless website migrations.
Not to mention, you can earn commissions of up to 20 percent.
Recurring revenue for agencies — simplified
Earn up to 20% per referral with the Liquid Web Partner+ Program
Offer website maintenance packages
Why not offer a monthly retainer on website maintenance to existing or potential customers?
Simply put, maintenance can’t be overlooked, as it keeps websites performing at peak capacity.
Your package can include maintenance tasks like regular backups, updates, bug fixes, server monitoring, and ongoing WordPress plugin renewals.
This is especially lucrative if your client base includes ecommerce business owners because their websites have greater security risks and increased traffic needs. You might also find that their internal team can’t keep up with maintenance, which means it can fall by the wayside.
Maintenance is cumbersome, so small businesses and entrepreneurs also can benefit from this offering. What better way to foster long-term customer relationships than to offer ongoing maintenance?
Provide web audit services
Conducting website audits for client sites is a surefire way to generate recurring revenue for your agency. That’s because audits allow you to identify potential recurring revenue streams. And any website can benefit from regular audits.
You can start by offering past customers regular website audits. It will be easier to get them on board since they’ve worked with you before.
You can also leverage consultation calls to pitch web audit services to a potential client. Some might have a DIY website and could use your help to identify critical performance issues.
And for customers with a limited budget, you can offer quarterly audits or longer payment plans if they opt for monthly or biweekly audits. The point is to create a recurring income instead of performing a one-off audit where you’ll get paid once.
That said, a one-off website audit where you analyze a client’s most important page (such as an about page) can land you recurring business, especially if the client gets results from the audit.
With retainers, you allocate a certain amount of time to your clients each month.
Retainers offer customers assurance that you’ll set aside time for them. You can get paid in advance or once the work is complete.
So whether you offer weekly or monthly retainers, you’ll generate recurring revenue.
Retainers also allow you to stay top of mind, upsell additional services, and build credibility in your niche.
A monthly retainer can include tasks and services like website redesign, content updates, and SEO. Basically, it can involve tasks that customers can’t afford to put on the back burner.
Although offering retainers can be beneficial, how you structure them can determine whether you’ll earn a profit.
Implement pricing that reflects the value of your offerings rather than the time spent working on a project. And outline the scope of work and payment terms in your retainer agreement.
Create a members-only portal
Another great way to create a predictable income is via a members-only portal. Offer the portal in exchange for a paid subscription.
How this works is simple. Members pay a monthly fee to access content like digital downloads (like ebooks and in-depth guides), exclusive interviews, videos, and templates.
With a membership website, you can provide more value, attract new customers, and establish yourself as an expert. It can also help you engage your customers and understand them better.
Create turnkey websites
With a turnkey website, all the end user has to do is simply “turn the key” and start using their website right away. Essentially, it’s a pre-made customizable website.
Creating turnkey websites allows your agency to diversify its income stream. That’s because they’re easy to create and scalable and appeal to customers who can’t afford custom websites.
Sell SEO and content creation services
There’s no denying it — with search engine optimization, businesses can increase the likelihood of being found by potential customers. So, offering SEO and content creation services is one of the best ways to generate additional revenue for your agency.
Offer ongoing SEO services to your customers, and they can rest easy knowing you’ll do all the heavy lifting.
Conducting website audits can help you identify SEO pitfalls, like keyword stuffing, poor page loading times, and broken links. So, it might be a good idea to bundle website audits, SEO, and content creation into tiered packages.
If you don’t have the means to offer content creation services, consider outsourcing to freelancers (maybe from your network) or look into a white-label partnership to provide customers with content like blog posts, thought leadership content, and website copy.
Offer WordPress support
When you consider that 43 percent of websites are built on WordPress, offering WordPress user support can create a steady flow of income for your agency.
When you also factor in that WordPress only offers support through its forums, that’s even more reason to include it in your service offerings.
The aim is to offer personalized support, which users are less likely to get from WordPress forums. If you have a WordPress-savvy team, you can provide more value to your customers and get ahead of the competition.
Speaking of the competition, you may find that they offer ongoing customer service, which might put you at a disadvantage if you can’t do the same. One way to get around this is to invest in chatbot software or create a self-service option, like a knowledge base for common issues.
Manage social media accounts
Similar to handling your customers' SEO strategy, you can offer to manage your customers' social media accounts or social strategy to keep money flowing in.
For example, a 2022 Visual Objects report shows that 70 percent of small businesses invest in social ads. So it’s a good idea to pitch social media services to your customers. A monthly retainer would work fine since social media requires continuous effort to see results.
You can create posts, repurpose blog content into social posts, collaborate with influencers on your clients' behalf, and answer customer queries. In fact, 76 percent of marketers already offer customer service on social media.
Let’s wrap up our comprehensive list of recurring revenue for web agencies with graphic design.
Provide graphic design services
While managing your clients' social media accounts, you can offer to create graphics to accompany their content.
Not just for social, great graphic design can impact how a business is perceived since people are drawn to visuals.
In the spirit of creating recurring income for your web design agency, you can offer to create graphics for your clients’ ecommerce stores.
Offering ongoing graphic design services can make you invaluable to your customers. As it happens, 24 percent of businesses said graphic design projects take too long.
And like any of the above-mentioned recurring revenue ideas, if you don’t have the skill set to offer graphic design in-house, find a reliable partner to help you.
Tips for a successful recurring revenue model
Now that you know how to build a recurring income for your company, it doesn’t end there. Here are three tips for a successful recurring revenue business model:
- Ensure billing is transparent. You’ll find that many businesses reiterate that their product has “no hidden charges.” That’s because when billing is transparent, it builds trust, which can create long-term work for you and your team. You can invest in accounting software, especially as you scale and your systems become more complex.
- Be strategic with pricing. One word: value. How you price your packages can make a huge difference in your earning potential and how you communicate the value of your offerings to your clients. Price your offerings so that you and your customers come out on top.
- Know when to upsell. With a recurring revenue business model, it’s essential to be on the lookout for upselling or cross-selling opportunities. For example, if you offer content creation services, you can offer to develop a content strategy to generate additional income.
FAQs about recurring revenue for web agencies
Here are some of the most common questions regarding recurring revenue for web agencies.
Is subscription revenue the same as recurring revenue?
Subscription revenue is a type of recurring revenue, but the two aren’t the same in all aspects. That’s because you can also generate recurring revenue from retainers and long-term contracts. Look at it this way: Recurring revenue isn’t necessarily subscription based.
Subscription revenue is popular with ecommerce and software-as-a-service (SaaS) companies and entertainment businesses like Netflix.
What is a good recurring revenue rate?
Generally, a monthly recurring revenue (MRR) growth rate of 10–20 percent is good. Here’s a tip: Tracking your MRR can help you identify areas to improve.
How do you calculate MRR?
One way to calculate your MRR is to multiply the average revenue per customer by the number of customers in a month. There are different types of MMR, including new, expansion, and churned MMR.
Understanding the different types of monthly recurring revenue can help you maximize your revenue.
Final thoughts: Recurring revenue for web agencies — a blueprint for success
Any of the strategies listed above can go a long way in creating recurring revenue streams that will support your agency into the future. Remember to nurture client relationships, upsell when the opportunity arises, and carefully set your pricing to keep money flowing in.
You don’t have to embark on this journey alone, so why not consider Nexcess?
Nexcess is a Liquid Web brand and part of the Liquid Web Partner+ Program. With our hosting partner programs, you can focus on building additional revenue streams while we handle the rest. Check out the Liquid Web Partner+ partnership program today.