Start Building Scalable, Recurring Revenue for Your Agency Today

The feast-or-famine cycle is a common agency challenge. One month, projects are flooding in, and the next, you’re scrambling to meet your goals. This ebb and flow of project-based revenue isn’t just stressful; it actively hinders growth. This cycle makes it difficult to plan, invest, and scale your team. The solution lies in building a scalable recurring revenue model.

By shifting your focus from one-off projects to predictable, ongoing revenue streams, your agency can achieve financial stability, enhance client relationships, and unlock growth potential. 

Let’s take a look at actionable strategies you can use to help your agency thrive in the long term.

Understanding the power of recurring revenue

Recurring revenue is the lifeblood of a healthy, growing agency. It transforms your business from a one-off vendor into a stable, trusted partner. Recurring revenue means your team can focus on building creative solutions for your clients. 

Building recurring revenue provides several benefits to your agency, like:

Predictable income

Imagine knowing, with reasonable certainty, what your agency’s baseline annual revenue will be. This predictability is critical for accurate budgeting, strategic hiring, and confident investment in new tools. 

Predictable income reduces the constant stress of finding your next project. That freedom allows you to focus on landing the right clients and delivering exceptional results.

Increased customer lifetime value

When clients engage in ongoing services, their value to your agency extends far beyond a single project. Assessing their value over time is referred to as Customer Lifetime Value (CLV), an important metric for growing agencies. 

A higher CLV means existing clients continue to contribute to overall revenue. Research by Bain & Company suggests that increasing customer retention rates by 5% can increase profits by 25% or more.

Operational efficiency

Standing up recurring services should involve creating standardized processes and leveraging automation, leading to greater efficiency. This reduction in complexity allows your agency to slash hidden costs, reduce time-to-market and improve profit margins. 

In other words, standardizing your processes empowers your team to work smarter and faster, freeing up their time for more strategic work.

Enhanced business valuation and reputation

Whether you’re considering future exit strategies or seeking investment, a strong recurring revenue model significantly boosts your agency’s valuation. 

Investors and buyers prioritize stability and predictable cash flow, making agencies with robust recurring revenue streams far more attractive.

But more than just attracting investors, it helps build a reputation as a trusted partner for your clients.

Identifying recurring revenue opportunities

The beauty of recurring revenue is that many agencies are already performing tasks that can be productized into ongoing services. 

Here are key areas to explore for recurring revenue streams:

Hosting and infrastructure management

If you’re not already, providing hosting for clients is a powerful recurring revenue stream. Yeah, we know “reselling” is often considered a dirty word, but that is an outdated view of agencies providing hosting. 

We are so far removed from the bad-old-days of generic commodity hosting resellers. In fact, today’s digital agencies know providing best-in-class hosting is a necessary component of building innovative technology for their clients. Beyond that, it’s a crucial element of building an agency’s recurring revenue. 

It’s logical that you’d provide (and manage) the infrastructure your clients need for the digital experiences you build. Managing client hosting also carries that added benefit of being a great way to increase CLV and build client stickiness.

Not only that, offering hosting sets you up to bundle additional, hosting-adjacent services like maintenance and security.

Website maintenance and security

After hosting, this is often the lowest-hanging fruit for recurring revenue. Clients don’t just need their websites online; they need them to be secure, updated, and optimized for performance. 

Maintenance packages often include WordPress core, theme, and plugin updates, regular backups, security monitoring, performance optimization, and uptime monitoring.

Additionally, you can create tiers of maintenance services so your clients have options to get the exact support they need. While your basic tier might only include updates and backups, a premium tier might offer everything listed above.

Digital marketing retainers

For agencies specializing in marketing, ongoing retainers are a natural fit for recurring revenue. Offering search engine optimization, pay-per-click ad management, content marketing, and more makes sense for clients without those capabilities in-house.

The key is to combine continuous improvement, robust performance reporting, and ongoing strategy building based on the data you’re monitoring.

Software-as-a-Service integrations and optimization

For clients using your marketing services, there’s likely a need to integrate various third-party Software-as-a-Service (SaaS) tools. Good news—your agency can offer to manage and optimize these services for them. These can include customer relationship management platforms (CRMs), email marketing platforms, or even project management tools. 

There’s still an opportunity even if your clients manage these third-party tools in-house. Your agency can offer consulting services when these tools intersect with your other offerings, increasing your value as a partner.

Providing AI services and support

In an increasingly AI-focused market, there’s a real opportunity for your agency in combining both marketing services and SaaS support. By offering AI services, tools, model training, and optimization, you equip and prepare your clients for the reality of AI-supported marketing including generative engine optimization (GEO), the new SEO.

This is a relatively new and fast-growing opportunity. But more than that, it’s an area where companies may look to bring work in-house. By proactively addressing their needs, your agency can become their de facto AI partner. Use this opportunity to strengthen your relationship and capitalizing on a burgeoning market.

Support and consulting packages

Beyond just technical support, clients often need ongoing guidance on how to plan for growth and future digital transformation. Assuming your agency has established itself as a trusted partner, being able to provide dedicated technical support, strategic development consulting, training for their internal teams, and more should be an easy sell. 

As your agency becomes an extension of your clients’ teams, you prove you are a clear value-add for them. If you already provide expert advice, monetizing it simply helps your bottom line.

Structuring your recurring revenue offerings

Once you’ve identified potential opportunities, next up is packaging services in a way that’s attractive to clients and profitable for you. This starts with productizing your services.

Productizing services

Productizing is simply the process of defining your offerings and attaching a monetary value to them. It involves defining clear scopes, deliverables, and pricing for your new services. This not only simplifies sales, it also ensures consistent quality and creates efficiency throughout your clients’ lifecycle. 

This is also when you want to consider building out bundles of related offerings. Make sure clients can get everything they need at once without going line by line through your new “services menu.” 

Tiered pricing models

While packaging helps reduce options, you do want to make sure your clients are getting exactly the value they need. The “Good, Better, Best” approach is an easy way to sell the highest value tier without devaluing the other offerings. For instance:

• Good: Essential services at an accessible price point. E.g., monthly updates, daily backups, and uptime monitoring.
• Better: More comprehensive services, addressing common client needs. E.g., weekly updates, daily backups, uptime monitoring, proactive security monitoring, and CDN services.
• Best (Premium/Enterprise): Full-service, high-touch, and strategic support for clients who demand the most. E.g., everything from Better plus DDOS protection, ongoing performance monitoring, and prioritized support.

This approach allows you to meet clients where they’re at and encourages them to upgrade as their needs grow. With a focus on value-based pricing, you continuously pitch your agency as a trusted partner, all while driving recurring revenue.

Yes, and…

It should go without saying that creating recurring revenue for your agency doesn’t mean you’re abandoning project work. Most new clients will come to you looking for help with a single project. Use that as a chance to sell your additional services.

Actively upselling one-time project clients into recurring service agreements helps highlight the benefits of an ongoing relationship. Then you can use your success along the way to prove your value to them.

Effectively selling (and marketing) recurring services

Selling and marketing recurring services requires a different conversation than selling a one-time project. It involves framing the value of long-term collaboration. You’re not just selling thier next digital property, you’re articulating how your agency is uniquely positioned to help push them to the next level. 

But beyond those sales conversations, effectively selling your recurring services also impacts how you onboard clients and approach retention.

Shifting the sales conversation

Instead of focusing on just the project in front of you, emphasize the long-term value, partnership, and peace of mind that your agency provides. Yes, you’ll provide a state-of-the-art site that meets their needs right now, but you’ll also do so much more for them. 

When needed, educate clients on total cost of ownership, framing your services as an investment in their business’s sustained success and a valuable contributor to their revenue.

The importance of good client onboarding

A well-defined onboarding process reduces early friction and builds trust. This is your time to set clear expectations regarding communication channels, reporting frequency, and what you’re delivering. 

It’s also a good time to agree on success metrics and perceived challenges so everyone is on the same page from day one. 

Retention strategies

When you consider managing long-term relationships with your clients, there are several tried and true things you can do to keep them running smoothly. 

First up is proactive communication. Create a regular cadence for updates and don’t be afraid to reach out to assure clients you’re on top of things—especially as anomalies develop in the data.

A part of that communication strategy is regular reporting. By providing scheduled, transparent reports, you demonstrate the value you’re delivering. These can include uptime reports, security scan summaries, performance improvements, or marketing metrics.

Regularly reporting is also a great time to demonstrate ROI. By quantifying the impact of your services whenever possible, you’re reinforcing the value your agency provides.

All of this proves your commitment to exceptional customer service, which can win customers for life. Be responsive, helpful, and go the extra mile. A strong relationship makes clients less likely to churn, safeguarding your agency’s recurring revenue.

Tools and automation to scale recurring revenue

The right tools and automations are indispensable when scaling your recurring revenue model.

Here are just a few of the types of tools you can use to grow your agency’s bottom line with recurring revenue.

CRMs

Tools like HubSpot and Salesforce are essential for centralizing client data, tracking communications, managing sales pipelines, and automating follow-ups. 

Project management software

Platforms such as Asana, Monday.com, or Notion help organize recurring tasks for various retainer plans, assign responsibilities to your team, track progress, and ensure consistent delivery across clients.

Billing and invoicing automation

Building recurring revenue means a lot more invoices and payments. You’re going to want a system that helps automate recurring invoices or payments. This ensures timely payments and reduces administrative overhead.

Hosting & Maintenance Platforms

Remember how efficiency and automation are key to building a sustainable, scalable recurring revenue for agencies? Your choice in web host can make or break your efforts. 

It’s important to find a hosting partner that understands agency needs and offers plans and features to support your growth. Managed hosting providers who understand agency needs, such as WP Engine, help ensure you’ve got the tools you need:

• Agency-focused plans: From agency-friendly infrastructure to scalable features and consistent costs, WP Engine offers plans that set agencies up for success.
• Simplify  management: Both for you as you manage multiple client sites from a single dashboard, and for your clients as they reduce the number of vendors they oversee.
• Automated updates: WP Engine’s plans include fully managed core WordPress, PHP, and MySQL updates, and our Smart Plugin Manager automates plugin updates on client sites.
• Speed and performance optimization: WP Engine offers tools to automatically optimize site speed, helping you keep client sites running at their best.
• AI features and tooling: With plan-wide access to essential AI features, every client can benefit from Smart Search AI or access Managed Vector Database services for the custom AI functionality you’re building for them.

Tools like these significantly reduce the manual effort involved in managing a large portfolio of client websites, allowing you to scale your client base and boost your overall annual recurring revenue.

But more importantly, true agency-focused hosting options provide your agency with clear, predictable pricing and an easy path to scale your hosting plan. This is essential from both a cost control and a growth perspective—giving you what you need to be profitable today while ensuring you’re ready to meet the client demands of tomorrow.

Tl;dr on recurring revenue

The shift to a recurring revenue model is not just a strategic choice; it’s the bedrock of a stable, resilient, and rapidly growing agency. By identifying recurring service opportunities, productizing your offerings, and focusing on long-term client relationships, you can transform your agency from a project-to-project hustle into a stable, focused agency with predictable recurring revenue.

To get started, identify a couple opportunities, productize them, and include them in your next pitch. Need additional help getting started? Chat with one of our agency experts today to see how we can help.Want to keep exploring this topic? We’ve got a more in-depth ebook for that.