What does building a pricing strategy look like in real life?
Meet Ashley, Klaviyo Champion and Director of Email Marketing at SmartSites, a full-service digital marketing agency. Ashley led the expansion into email and SMS services, successfully launching and scaling Klaviyo services in just 9 months. Today, SmartSites is a Klaviyo Gold Partner with over 1,000 five-star reviews.
In this course, we’ll share Ashley’s strategies. Though SmartSites is a large agency, her growth tactics apply to agencies and freelancers of any size. We’ll showcase her key actions and how they can be adapted to fit any agency, big or small.
How to earn a profit
To be more profitable than your baseline rate, you have a few options:
- Decrease your expenses.
- Increase your price per hour.
- Change your pricing model to optimize your profit.
In this video, we’ll walk through the third option: change your pricing model.
As you build expertise in Klaviyo, you’ll spend fewer hours completing the same tasks, making each hour you spend with your client more valuable. Instead of penalizing yourself and your team for your efficiency, we'll guide you through transitioning your services to a regular, monthly retainer. Then, we'll connect theory to practice by showing how Ashley’s team launched and executed Klaviyo services.
How SmartSites launched and scaled Klaviyo services
When Ashley joined SmartSites, she came on as a project manager overseeing their existing services, which at the time were heavily focused on SEO and paid ads. As SmartSites grew, Ashley led the launch of Klaviyo services. Pricing was a critical part of this strategy, as they wanted to ensure that they gave themselves the opportunity to learn and experiment but were on the road to profitability.
Because SmartSites was already using a retainer model, they launched Klaviyo services as a retainer. However, Ashley incorporated key actions that all agencies can learn from to evolve Klaviyo services as her team ramped up.
Here are some key actions Ashley took to launch Klaviyo services:
Step 1: Offer a discounted rate to existing clients in exchange for feedback
SmartSites, an established firm that could afford to take some risks, offered a discounted rate to existing clients in exchange for feedback. They surveyed their beta clients consistently to understand what worked and what didn’t. When clients saw positive returns, they submitted case studies as part of the agreement for their discounted rate.
Even if you can't discount your services, offering added value in exchange for feedback is crucial. Engaging with customers about what works and what doesn’t helps build a more reliable process.
Some incentives newer agencies and freelancers can offer for free may include:
- Account audits
- Customer journey or consultation sessions
- E-books and educational materials
Most importantly, leverage your previous work experience to build a niche. Do you have industry expertise from your previous work experience? Are you a Gen Z consumer who can demystify your peers’ buyer behavior for brands seeking to appeal to this age group? You have a unique point of view, and productizing it through free strategy sessions or consultations will encourage brands to take a chance on you.
Step 2: Track how long each task takes
Using a project management tool, Ashley tracked the average time it took to launch each task, from building out a client’s welcome pop-up to each customer journey flow. Additionally, this spreadsheet tracked each client’s health and account metrics. This helped Ashley’s team see where efficiencies were being built into the existing process and where refinements might be needed as they scale.
Step 3: Gradually reduce discounting as you build a repeatable process
As Ashley identified key process gaps, their team continued to offer discounted services, but not nearly as steeply as they had earlier. Over time, they were able to reduce certain discounting tactics and build a repeatable process for the agency.
Step 4: Track tasks with variable time spent
Some tasks take a fixed amount of time, like creating key segments, while others, like migrating a client's potentially messy data from your ESP, may take variable amounts of time.
Track which tasks take longer depending on the client’s current state. This will help you identify how much time you need to complete each task and determine the appropriate scope of work for your prospective clients.
How do I know when I am ready for the next phase?
Your pricing model is highly dependent on your business, and offering hourly rates may not make sense for your existing structure. However, we hope that this framework helps you think about how to beta launch your services as you accommodate for scaling and the inevitable learning curve.
In the next lesson, we will walk through what metrics to track to determine when to move from one phase to the next when evolving your pricing model.