Products + Services = <3

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Paulina Sáez

Contents

  • Avoiding failure
  • What is a productized service?
  • Is a productized service right for you?
  • Productized service examples
  • Crafting your productized services offer

Avoiding Failure

In my last issue, I shared the journey of deciding what to offer. This week, I want to talk to you about a not-so-common way to build your service offer.

The challenge after deciding what to sell is creating a profitable offer. This involves creating a persuasive message to explain to potential clients what they will get in exchange for their money.

To do this I recurred to inversion, one of the most powerful mental models. Instead of asking “What should I do to make my projects successful?” I asked, “What should I do to prevent project failure?”

Project failure manifests in numerous ways, and one of the most common ones is scope creep. A staggering 34% of projects experienced scope creep, according to a Project Management Institute survey. This illustrative story from a web developer on Reddit shows how a small project turned into a massive project:

What started out as a Greasemonkey injection that loaded a pop-up of some graphs for the tech support department is now an internal systems portal that covers every single business aspect in the company (sales, service, scheduling, phone/call queue, ticketing, marketing, customer interactions, etc.) and replaced our old ERP system entirely.

Does this sound familiar? Have you ever over-delivered?

I know what failing at a project feels like.

I learned my fair share of lessons while working as a freelancer:

  • I said yes to requests that were outside of the scope document. This led me to feel like sometimes I was taken advantage of by my clients asking for things I didn’t originally discuss with them.
  • I set a broad offer which meant that every project felt like starting over again. Catering to everyone’s needs is challenging, especially for people working solo.
  • I did hourly or project-based billing. I spent a lot of time meeting with the clients, assessing their situation, creating a proposal, and negotiating the agreement.

I understand that the client needs to be happy. But there’s a difference between good customer service and doing things out of the scope. Where to draw the line?

Back then, I thought this was just the way freelancing worked.

But I refused to believe that was just the way it was supposed to be. There must be a better way.

So I decided to look for a way to deliver services on my terms, where there’s clarity on price and scope, eliminating endless negotiations and revisions. The solution was clear: I had to productize my services.

I limited what I would deliver and moved from an hourly rate to fixed packaged plans.

The result? Services that are straightforward, with aligned expectations for everyone, allowing me to focus more on service fulfillment. I realized I didn’t need to spend so much time crafting every proposal. I could focus on my strengths and in services and clients you know that work.

Maybe you’ve heard about the productized services business model before, and you’re playing around with the idea to implement a more productized offer. Or maybe this is the first time you heard the term. Either way, keep reading to see how others are doing it and how you can build your productized offer today.

What Is a Productized Service?

A productized service is a business model where you offer a service that’s sold as a product, with standardized “packages” with clearly defined scope and deliverables. Unlike traditional services which offer highly customized deliverables, pricing, and scope.

This model lets you run your services in a more scalable manner, resulting in a more straightforward and predictable process for clients and providers.

Simply put: while traditional services run on people, productized services run on systems.

Traditional Services versus Productized Services

Is a Productized Service Right for You?

While this model is great for scalability and predictable revenue, it’s not for everyone. You have to analyze if the benefits outweigh the drawbacks before jumping on the productized train.

Benefits

  • Clarity: Provides clear information on what’s included, scope, timing, and pricing. There’s no need for quotes and getting into several calls with the clients just to know if you’re the right fit.
  • Scalability: Standardization allows you to serve a larger audience without having to excessively increase your workload. There’s less risk of burning out.
  • Predictable Revenue: Fixed pricing facilitates easier revenue forecasting and financial planning.
  • Streamlined Sales and Delivery: The standardized approach simplifies the buying process, enables online purchases without having to build customized proposals, and allows for a more consistent and potentially automated delivery process.
  • Easier Messaging: Services can be marketed like products, with clear features, benefits, and pricing, simplifying the communication of value to potential customers.

Drawbacks

  • Client Acquisition: You need to be continuously attracting new clients. You can mitigate this by offering retainer packages on the backend. The trust established through the initial delivery can make upselling easier.
  • Advanced Customer Understanding: Success depends on a deep understanding of your potential customer. This model works best for people with a deep experience in their offering.
  • Limited Customization: This type of service might not be well suited to clients with specific or complex needs that need more tailored solutions.
  • Market Saturation: the market for productized services grows more crowded, so differentiating services is becoming a major challenge.

How does this business model look in practice? Let’s look at real-life examples.

Productized Services Examples

Types of Services

If you’d like to see more examples, feel free to check out this Notion template I put together. It includes additional resources to help you in building your productized offer: 

Packages examples

You don’t need to offer recurrent services You can also offer one-time services. Here are two examples to show you how each would look like for the same type of service:

How much are other people making?

  • Manypixels – Unlimited graphic and web design services: making $6.6M/year.
  • Draftss – Graphic design and coding services: making $180K/year after 3 years of launching.
  • Smart Yeti – Fractional CMO services: making $96K/year.

Crafting Your Productized Services Offer

Turning your service into a productized offering involves standardizing your deliverables and packaging straightforwardly and attractively.

If you’ve decided what’s going to be your offering, identified your niche, and confirmed there’s demand, the next step is to build your offer.

Here’s what you should include:

  • Name: Choose an attractive name that reflects the value and outcome of your service. It should have a structure similar to this: “I help {niche name} to {outcome you’re helping your customer achieve} by {what you do with your service}.”
  • Scope of Work: Clearly define what your service includes and, most importantly, what is not included to set the right expectations.
  • Deliverables: List exactly what the customer will receive upon completion, including any tangible deliverables or outcomes.
  • Add-Ons: Offer additional services for people who need more than the standard package, such as extra-fast delivery.
  • Timeline: Establish and communicate the turnaround time for your service.
  • Trust-Building Items: Add elements that establish credibility and trust with potential clients, like customer testimonials, case studies, or your background (qualifications and experience).
  • Client Requirements: What are the requirements you need from your client before start working with them
  • FAQs: Answers to common questions to help overcome objections and clarify any uncertainties.
  • Terms and Conditions: Legal aspects, including refund policy, service level agreement (SLA), and any guarantees.
  • Pricing: Opt for fixed pricing, with tiered options to accommodate different client needs.

I’m bullish on productized services. I bet that we’ll see more productized services this year. This business model is great for solopreneurs. A limited scope is more scalable than creating a quote for each project.


I would love to hear your feedback! Leave your comment below and share your thoughts with me.

Keep rocking,

​Paulina​

PS: Don’t forget to grab your Productized Services Notion template: Grab it here.

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Paulina is the creator and main writer at UpGroves. She spends her days analyzing how successful creators and entrepreneurs grow their businesses. She's a curious generalist that likes to spend her time going down on internet rabbit holes, reading, and walking in nature.

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