Copy This Strategy. It Will Blow Up Your Agency

There is no greater lever in your agency than your pricing, and there's no greater method for scaling an agency than charging more money for the exact same thing. Yet almost no one that I talk to knows how to do this in an effective and intentional way. The reason that pricing is so powerful, because a price increase adds pure margin to your bottom line. And this margin can be used to reinvest in better hires that are more competent and you'll spend less time babysitting. You could reinvest them in paid ads, you could reinvest them in more outreach capacity, such as more profiles, more inboxes, and all that kind of stuff. You can invest them in better content, and then you can invest them in more tools and software and your sales team and so on. So this increase in pricing actually leads to more sales that also have an increase in pricing. In this video, I'm going to go over the exact pricing strategy that I think agencies should use to scale to 10 million per year or more. So the first step in this pricing strategy is to get to a baseline of $200, $250 per hour or more in terms of an effectively hourly rate. So this means that if whatever product or service you're offering takes 10 hours to fulfill, you should charge a minimum of $2,500 or more. Why is that important? Well, after customer acquisition costs, appointment setting costs, closing costs, labor, softwares, tools, taxes, all that kind of stuff, there just isn't that much money left over to scale if you're charging less than $250 per hour for your services. So how do you measure that over the next month? I think you should change to a time tracking tool for all of your employees and try to get an accurate measurement of just how long it takes them to do a job for maybe a sample size of 5 clients. If you are charging a monthly retainer of, let's say $5,000, for example, for client A, B, C, D and E, it should take your employees on average 20 hours or less combined between all of the people that work on it. Or you are undercharging and you're not really set up to scale. You need to get this $250 per more or in terms of effective hourly rate. And after you are at that baseline, then you're ready for the next step. And the next step is to collect as much social proof as possible. It's very hard to raise your prices too much without it. What are some examples of that? So at my previous agency, some forms of social proof we had is Three different pages on our website. The first is a page with the logos of every client we ever worked with. You could just scroll through it kind of endlessly. The next is a screenshot of all the client wins From Slack, From WhatsApp, from iMessage, From email, that kind of stuff. And then we had a page with our case studies. Those are just kind of an example of what you can do. There's a lot more. So in terms of an exact plan of action, do what I did is make that page of logos and put every single logo you've ever worked with. Put them kind of maybe like a two by two column. So it takes even longer and longer and longer to scroll. It'll make it seem like you have more clients than you actually do if you don't have that many. The next is to make a page for screenshots of client wins. So get a VA to go through historically all Your messages, your WhatsApp, your Microsoft Teams, if you use it, your emails, your Slack and any other channel from the beginning of time to now. May take them a long time to do this. And take screenshots of every single win and post on this page again, try to make them going all the way down in the center so there's just one column and make it an endless scroll of client wins. Probably take 10, 15, 20 minutes to scroll through it at a reasonable pace if you make it in one column. The next is to make a page for case studies. You want to work your way up to a minimum of 12 long form video case studies that can be either with the client or without. It doesn't really matter, but it should go in depth over what you did before verse, after the results and all of that kind of stuff. Then you're going to want to make a page for testimonials and work your way up to 12 video testimonials. Just one to two minutes. Hey, my name is Matt. I hired Daniel to do this and you know, this is what he did and this is how great it was working with him. That kind of stuff. Try to get landscape, but also like the portrait or the Instagram style works too. The next is to sign up for Google, My Business, TrustPilot, Upcity.com and Clutch Co UpsidyandClutch Co are two high domain authority review sites. And try to work your way up to six or more reviews on each. If you have good friends that are clients, just ask them to copy and paste reviews the same on each, but at least get them on, you know, one of them. And work your way up. Rotate it through, you know, first Google my business. Next person I asked for trustpilot, Next person for Upcity, next for Clutch Co, next person. If you have dozens and dozens of reviews on all of those sites, all showing up in Google when someone searches you, it looks really good. And these third party reviews are a lot more believable than ones that are just written on your site, even if they're the exact same thing. Once you have your social proof in order, the next step is to max out your capacity. I'm a big believer that you should never raise your prices, assuming you've already got to that $250 per hour or more, until you have reached just capacity. It's a simple case of supply and demand. If you can't even fill your employee schedule and your current capacity at your current price, why would you think that we can get them at a higher price? I see people do this all the time. They arbitrarily raise their prices with just a handful of clients when their team is not already booked to capacity and basically getting every hour that you pay them. It's very strange. So what should you do? You should basically do this, but also systematize and delegate to where you can get 3 new ad creatives per week, consistently post 3 very valuable YouTube videos per week, consistently rate 25 new tweets per week, consistently 10 new threads, 7 short form videos, 5 newsletters. Spend 5 hours prospecting to new clients, 5 hours prospecting to potential partners, and follow up with your entire CRM twice per week. You don't necessarily need to be the one that does all those things, but you should spend all of your time building a system to ensure all of those nine outputs get done every single week on autopilot. Once you do this, you're going to be generating as many leads as you can possibly handle and you'll be fully booked. And then you'll be ready for the next step. Don't do the next step until you're fully booked. So if you're not fully booked already, make sure you quit watching the video at this step. So once you're fully booked, the final piece has to do with your sales metrics. So chances are, if you've gotten to this point of the $250 priority rate or more and you're fully booked, you probably have one or two sales reps at least, or maybe even a small sal sales team. The main metric that you want to use to gauge whether or not you should increase the price is the close rate of Your sales team from cold traffic. So content, paid ads, outreach, don't count referrals in this if you can, because it'll just skew the data. So simply put, anytime the combined close rate of the sales team is at 25% or more, you should increase the price by 20%. If you increase the price by 20% four times, that is essentially doubling your price with the rule of 72 and compound, you know, interest and compound gains. So basically you can continue to raise your price over and over until you've raised it so many times that your sales team is only able to get 15 to 20% close rate. Chances are this will be probably two times or double the price that your current prices are at. It's hard to believe before it happens to you, but once you are getting to a 15 to 20% close rate and your sales team is well trained, you have found the correct price, so to speak. If it's less than 20% or less than 15 to 20%, you may need to even decrease the price and make sure your sales team is better and better before doing that. The reason that you always want to be at a 15 to 20% close rate is it's a good balance between you are getting enough clients and closing enough deals to replace your churn. But also it is enough people are saying no that you don't want to work with. And the ones that say yes are the most serious and the highest paying people. It just is allows you to have a lean team, so to speak, while charging premium prices. And there's going to be no bloat in there. So once you have found that 15 to 20% close rate and your price is as high as you possibly can, for the time being, you're going to be much better off training your sales team to close better, creating better offers, building a better personal brand, training your operations team to deliver a better service than you're going to be worrying about. You know, spend time worrying about increasing prices further. This strategy is really necessary to scale to 10 million or more per year and it unlocks a whole new level of scale because the increase in price is all margin. To recap, the reason that this is so powerful is because in price increase adds pure margin that can be used for better hires, ad spend, more outreach capacity, better content, more tools, more software and everything like that, which will allow you to scale even further with more clients at a higher price over and over and over until you get to 10 million or more per year with your agency. So I hope this video was valuable. Thank you for watching, and I'll see you in the next one.