As an agency, priority #1 has to be your clients. After all, your job is to solve problems for your clients, answer some pain they have, and lower their anxiety.
Any tools you pick to build your digital agency have to first and foremost simplify your clients’ lives.But priority #2 is making money!
Because you’re selling expertise and more importantly your time, it is critical that you cultivate a stack of software that makes your work predictable, repeatable, and reliable so that you can best support your clients and scale your business.
But what software should you pick? Are you missing anything? And how do you use your software stack to make money?
When can you make money with software?
The phases of acquiring new software create opportunities for agencies to sell services.
The best way to make money is by selling your expertise on top of the software you are using to serve your clients.
What expertise? Clients rely on agencies to:
- Research, recommend, and even purchase software solutions;
- Then set up the software including integrating with other systems and training staff;
- And often to operate and maintain the software as part of their ongoing client services.
Every single one of those roles is an opportunity to sell professional services.
Why you should partner with software companies
Many software companies recognize the value of agencies in selling through to their clients, and offer business models that allow agencies to earn money from selling the software itself, such as by commissions or wholesale discounts.
You should take advantage of the partner programs offered by software companies for two reasons:
Pay for your time. Get paid back for the time and effort you spend staying up to date with the latest software on the market and any product changes, not to mention any customer service you provide to your clients for their accounts.
-
- Development partners build themes or custom sites for clients using development stores, and earn 10% of the current revenue for Shopify Plus plans or 20% of the recurring revenue from all other plans, as long as you keep referring at least one client a year. Note: all Shopify Plus leads must be registered manually through this form.
- Affiliate partners earn $2,000 for paid conversions to Shopify Plus, or 200% of the first payment for all other Shopify plans.Build relationships with the software vendors. The best software vendors to partner with do everything they can to help their best agency partners grow.
The more you know your software partners, the more they will:
- Refer clients to you to provide professional services for customers of their software,
- Promote you as an agency partner in their marketing communications, or
- Provide sales and marketing support, training, assets, and opportunities that help you sell through to clients.
How do software companies make money for agencies?
If software still came in boxes, the answer would be easy. Buy it, install it, mark it up, expense it, and done.
But software comes in subscriptions now. Getting between the customer and the software vendors can be complicated.
As a digital agency, how do you create an account and share it? How do you purchase a subscription and expense it?
Fortunately, the business models that work are getting better every year. Here’s a rundown of what you might do:
Agency buys
- Internal tools. Software that you need to make your agency more efficient but aren’t specifically purchased for one client.
- Bundling. Software you provide to the client at your cost because it priced into the service package you sold them.
- Subleasing. Agencies buy a master account and then create sub-accounts for each of their clients. The agency only pays in aggregate for all their accounts at some bulk discount.
Client buys
- Recommendations. Clients trust your expertise. It’s as simple as telling them what they should buy, either as a soft recommendation or a hard requirement for the project, and the client buys it themselves.
- Referrals (aka affiliates). Get paid for your recommendations through referral or affiliate programs where software companies will offer you a commission. The client still has to buy the software themselves.
- Co-sales. For complicated sales that are a mix of software and your services, the software vendor and you pitch together to close the sale.
Agency buys and then sells to client
- Reselling. Clients buy the software from you, and you buy the software, preferably at a discount. You take on the front end support, onboarding, success, and operations, making stickier clients and more opportunities to sell professional services.
- White label. A special case of reselling, but you brand the software as your own.
Managed services is the ultimate business model
Clients hired you to take care of a business problem for them.
If you’ve cultivated a software stack that solves this problem for your clients, many clients would be happier that you manage it for them, because you’re the expert.
You add value when you:
- Purchase the software
- Set the software up
- Integrate with the rest of their software
- Keep up with product changes
- Monitor costs
- Operate the software
- Train staff
- Provide first-tier support
Moreover, in digital marketing there’s always more software to solve more problems. You can stay relevant as an expert by managing and expanding software stacks to make your clients more efficient and competitive.
This will have the added advantage of not only making your clients stickier, but it will create opportunities to keep talking about ongoing business problems so you can sell more professional services over time.
Tools to make managing software for clients easier
Ok, we talked about how to make money, but the hard problem in managing software for clients are simply the mechanics.
How do you create an account and share it? How do you purchase a subscription and expense it?
Here are the tools a digital agency needs.
Password managers
Sharing account logins with clients comes down to sharing passwords.
If you’re using a Google spreadsheet or emails or post-it notes to share passwords with clients, please stop. You don’t want to be the source of a security breach for a client.
There are excellent password managers that make it really easy to record and share passwords with clients, such as LastPass, OneLogin and AppBind.
Let’s take a deeper dive into the benefits behind agency tools like these.
Purchasing software for clients is still tricky because you’re committing to tracking and expensing that subscription for the lifetime of the account.
One common approach is to buy annual subscriptions so the cost is predictable for a year, but that also means you’re locked into the same subscription level for a year, which punishes you for buying the wrong software or makes it difficult to upgrade mid-year.
Many software companies also prefer to invoice agencies for the cost of all their clients’ subscriptions. However, the overhead of paying invoices by hand, breaking down the overall expense by client, then separately invoicing your individual clients can be overwhelming.
Another choice is to buy software on your own corporate card, track the expenses, and then invoice your clients. Somehow you’ll have to decide which clients to expense for each line on your credit card statement.
And when your corporate credit card expires or is cancelled, you have to log into every client account and update their billing lest you cause your clients’ services to be suspended.
Fortunately, there’s a new solution, AppBind, on the market that solves all these problems.
AppBind lets you buy and manage software and advertising subscriptions for each of your clients, and automates the tracking, markups, and expensing to clients so you don’t have to worry about it. It also lets you pay all your credit card subscriptions with a backup credit card automatically when you card is cancelled.
And it gives you a single place to update when your get a new credit card.
Agency-friendly software tools
Now that we’ve covered how to manage software passwords and payments, what tools should you consider adding to your software stack as a digital agency?
Which companies care specifically about supporting digital agencies?
Here’s a list of software tools we recommend.
Crazy Egg
As a digital agency, optimizing conversion rates is your bread and butter. Crazy Egg makes it easy to analyze the customer journey, record user sessions, get visual reports and heatmaps, and run A/B split tests.
Bonus: You can use AppBind to resell Crazy Egg subscriptions to your clients!
WordPress is the most popular blogging and CMS platform on the Internet. It famously comes as an open source platform, but it also has a hosted offering at WordPress.com.
They have an Affiliate program that offers 20% lifetime recurring commissions.
This also includes sales of WooCommerce, their ecommerce platform, and JetPack, their security plugin through the same program.
Wix is the most popular website hosting platform and it’s great for small business clients. Wix offers agency partners two different programs:
- The affiliate program pays out $100 per paid sign up, which is generous. The catch is you need to generate a minimum of $300 in commission fees (i.e. 3 sales) a month.
- The Wix Arena is a directory of agencies that can design and build out Wix sites. In your Wix account, mark yourself available for projects and submit your client projects to list as case studies in the arena.
Shopify’s enterprise-ready shopping cart platform comes with an enterprise-class agency program.
But they are growing their program slowly and carefully. They maintain a carefully vetted agency partner list. In fact, their applications for new agency partners is currently closed (April, 2019).
You can still use their Affiliate Program which comes in various flavors.
- An affiliate program that offers 200% of the customer’s first monthly payment or $1,500 per enterprise customer.
- An agency program that offers a lot more, including sales training, co-selling, and a referral network including their directory of agency partners
BigCommerce
BigCommerce is a leading shopping cart platform that has recently made major investments in their digital agency partnership programs.
BigCommerce partnership offerings include:
- Agency account and client sub-accounts let you create one Sprout Social subscription with unlimited users and create an entirely separate account for each client. You can also get listed in their partner directory.
If you refer your clients to sign up directly, you can earn a 20% commission for the overall lifetime value of that account, provided you register those leads in their partner portal.
GetResponse
This simple email marketing product made for small businesses has a straightforward affiliate program that offers $100 one-time for each paying account or 33% recurring over the lifetime of the account.
ActiveCampaign
ActiveCampaign provides a robust email and social media marketing solution that is specifically tailored for agencies to resell.
- Affiliate partners earn from 20% to 30% as you scale up ongoing recurring revenue from all accounts you refer.
- Reseller partners use ActiveCampaign’s reseller portal to create sub-accounts for their clients. The more clients, the greater the wholesale discount. You can resell at any price.
- They recommend using AppBind to resell ActiveCampaign subscriptions when you want to automatically pass expenses onto your clients.
Hubspot
As the leading marketing automation tool that digital agencies support and resell, Hubspot has learned the value of investing in their agency ecosystem. Over 40% of their own revenue comes in conjunction with their agency partners.
As a partner, you can get listed in their agency directory as well.
- Affiliate partners earn from $250 to $1000 per referred sale of Hubspot depending on the purchase tier.
- Sales implementation partners. Earn 20% of the first year’s revenue of clients you refer through the Sales partner program. Note: you must purchase at least one seat of Hubspot Sales for $50/mo.
- Marketing agency partners. Earn 20% of the first year’s revenue of clients you refer through the Agency partner program, plus a dedicated Channel Account Manager to support you, and a Channel Consultant to teach you how to sell more retainers to your clients. Note: you must purchase one subscription of Hubspot Marketing Hub for at least $800/mo.
Sprout Social
Sprout Social is a very popular social media management tool for digital agencies, and it’s no wonder why. They are hyper-focused on digital agencies.
All their agency partners receive dedicated customer support, white-labeled content to market themselves as experts, and special sales training.
- Agency account and client sub-accounts let you create one Sprout Social subscription with unlimited users and create an entirely separate account for each client. You can also get listed in their partner directory.
- If you refer your clients to sign up directly, you can earn a 20% commission for the overall lifetime value of that account, provided you register those leads in their partner portal.
-
-
Instapage
Every digital marketing agency needs a fast way to create high quality landing pages. Instapage, the landing page maker, is made to support digital agencies with extensive agency programs.
- Affiliate partners earn 50% revenue share on the first payment and 30% lifetime revenue share on all self-serve plans (that is, not including the enterprise plans).
- Preferred partners get special training from Instapage, white glove support, and revenue sharing of 30% of the first payment made and 10% recurring thereafter (if you refer a customer) or 40% of the first payment and 10% recurring (if you close the sale yourself as a reseller).
- Fulfillment partners design and build out landing pages for Instapage’s advertising customers. Instapage will find clients for you and even include you in their agency directory.
HelloBar
HelloBar is a popular tool to convert website visitors into leads and customers by capturing emails, notifying customers of sales and discount codes, and displaying other calls to action in pop-ups and widgets.
They provide white-glove support to digital agencies. Just contact them.
UserTesting
UserTesting provides a very robust customer experience platform, called Human Insights, that collects customer data across all digital experiences (websites and apps).
While they do offer a partner program for agencies, they carefully select which agencies to work with.
Nevertheless, you can register an opportunity and see if they are open to partnering with you.
Monetate
Monetate is a robust personalization and customer experience platform for large ecommerce sites. It analyzes visitor behavior to change their website experience by pushing them down paths that make them most likely to convert.
They have a robust set of programs for partners but remain selective of which partners can join. You can apply here.
Unlimited opportunities for growth
We’ve shown you only a very small list of the digital agency tool opportunities out there on the market.
If anything, it should give you both the strong belief that many software companies are really investing in supporting partners like yourself; and also a vision of the wide number of business models the market is experimenting with.
However, you know best. It’s your power as your client’s first point of contact to shape how to buy, manage, sell, and service a software stack to meet your clients’ needs.
You’ll find a business model that makes sense for you.
Between the mix of business models software companies are offering, and powerful agency-centric tools like LastPass and AppBind that give you the ability to buy, manage, and resell any online service the way you want, it’s worth your time to start adding managed services into your practice.
Clients value agencies who take care of their problems. Earn more revenue. Grow your agency by doing the work you’re already doing, better.
Author Bio
Sunir Shah is the CEO of AppBind, an online subscription tool that solves the tricky problem of how partner resellers can buy SaaS and bill it to their clients.
