You have a service business. You want to increase revenue. This one is for you.
During my 30 years in the financial services industry, I have been in your shoes. I offer a service, and I charge a fee for that service. There is no physical widget involved. But there are always employees, and they want things like space, equipment, benefits, and opportunity. It is my job to make sure that happens. Oh, and make a couple of bucks for myself as well! So, I work hard to increase revenue.
- - To ensure I have the revenue I need, I do all the things:
- - Network at too many rubber-chicken events
- - “Throwing spaghetti at the wall” advertising
- - Try new markets
- - Partner with others
- - Scale my business
- - Rework the branding, logos and such
- - Lower internal expenses
These are all good ideas, and some do increase revenue as a result. But, then what? The answer: productize!
Why productize a service? Why is this helpful? In my case, it was because I ran into a wall in my business. I did the things listed above and still wanted more. Productizing my services is something that helped me break out of that stuck place and really accelerate my business. And I have seen it work for others. This is why I think it is worth your time to keep reading and consider this approach.
Below, I summarize Value Builder’s 8 steps to productizing a service:
1. Niche down. Picking a niche helps you get specific. Pick a niche and get granular. You cannot productize everything, so pick one place where you shine. Focus on one area and really drill down. Besides, you know the old saying, “there are riches in niches.”
2. Find your TVR. (Teachable, Valuable, Repeatable) Get a whiteboard and make a list of the services you offer the niche you chose in step 1. Next, score each service on a scale of 1 to 10 for: the degree to which you can teach employees to offer the service, how valuable your niche finds the offering, and the degree to which they have a recurring need for it. This is your Teachable, Valuable, Repeatable (TVR) service.
3. Define a prospect’s problem and the solution. Get clear about what problem the service you want to productize solves for your niche. Find every detail about that problem you are solving and create measurable success indicators that demonstrate how you are solving this problem along the way.
4. Brand it.
5. List your "ingredients." Though you are selling a service, you are making it appear to be a product. For that product, list the ingredients. In other words, list all the things you offer that solve the problem for your niche.
6. Pre-empt objections. When your brand or your employees are selling your product, you do not always have the benefit of personal interaction to overcome objections. Get out ahead of this and consider what objections may arise – and have an answer ready to go! You may also want to build the solution to potential objections into the product.
7. Price it. Service quotes usually use time worked or scope of project as their basis. Service quotes also typically appear at the end of a proposal. Products publish their price upfront, which is one reason they feel more tangible. A published price communicates that you have a standard offering that doesn’t change with each customer, whereas service pricing can vary greatly from one customer to the next.
8. Manufacture scarcity. One of the benefits of a service business is that you always have sales leverage because your time is scarce. With a product-centric business, your offering is always available. You need to give people a reason to act today rather than tomorrow. This means you need to manufacture a reason to act from scarcity – to create urgency for your product.
Thank you again to valuebuilder.com for what I’ve learned about productizing a service. I have seen this system work as a catalyst to help businesses get out of a rut.
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