How Building Care Plans and Recurring Revenue Will Transform Your Digital Marketing Agency

What is a care plan and how can it help your digital agency? 

A care plan is basically a set of bundled services that are used to keep a product or service (like a website) operating in tip-top shape. These services include security, performance, backups, monitoring and more. 

They help boost recurring revenue by creating long-lasting relationships with your clients through services that keep them coming back. 

Our very own Maverick from across the ditch in New Zealand Mike Spratt, CEO of Gherkin Media, has found success with implementing care plans for his clients. Recently on Agency Hour, Mike discussed building monthly recurring revenue and the framework that he uses to implement care plans. In fact, Mike won’t even take on a new client unless they agree to a care plan! 

How Does Gherkin Media Use Maverick Club Frameworks to Operate?

Mike’s agency operates a little bit differently to your average agency, and this is something that came about from joining Mavericks Club

In his first year in Mavericks Club, we focused on care plans and signature systems.The two products at the end of what you would call a scope are those that we feel can be most profitably sold to customers. 

After adopting these new operational tactics, Mike went through the process of introducing all his current clients to a new kind of proposition and downsizing on the clients who didn't want to move in that direction in a sort of “cleanup”.

Mike has been busy growing his business, both through the acquisition of new clients and by purchasing other digital marketing businesses. Mike even purchased our new CEO, Emily’s, company when she joined Agency Mavericks full time last year!

How Does an Agency Acquire Businesses?

What’s so cool about acquiring other digital marketing businesses, is that they often have lots of small recurring revenue products like email registration and hosting. What Gherkin Media does is wrap a care plan around those services and instantly increase the recurring revenue they receive. This is also beneficial for the customer as in most cases, their previous agency didn’t offer this higher level of service.. 

The types of agencies that Mike’s company looks to acquire, are ones that have a good track record selling email registration and hosting but that haven't talked to their clients about a care plan or any post-launch products. (Post-launch products such as SEO, digital marketing, all of that fun stuff). 

Mike is looking for something that will add value to his company. For example, if he's offered 20 perfect websites all and on care plans – not interested. Funnily enough it's almost like the scrappy businesses are better for him to acquire because there's a lot to enhance with his care plans. 

“Notice that opportunity lies where responsibility has been abdicated” 

In the web game, you only have to look through a website and you'll notice that upkeep is almost non-existent.

Well the client then turns around and goes what does that mean? What comes with hosting? And the answer to that is well, nothing. It's just space on the server. 

So then they ask ‘well what does it look like if I re-engage with you?’ Again that looks like more fees, so they're sitting there thinking ‘I bought this website and I don't really know what to do with it, and I have these monthly things for reporting and hosting that is really just a cost. 

 if I re-engage, that's more fees again,  and in a few years I'm going to need to buy another website from this company.’

These are the major pain points that a care plan overcomes. 

Mike’s model is through traditional means –  through SEO and Digital Marketing or through Gherkin Media’s two current active channels: 

  • Referrals which is 1 and 1 businesses coming to them 
  • Acquisition where the company will buy 100 clients overnight. 

But fundamentally when it gets down to the one-on-one relationships no matter how they are acquired, the process of showing them what a care plan is comes down to an explanation of showing clients that there isn't going to be a cost to getting a good website. That all of the monthly stuff is going to be covered in the cost of the care plan,  and that a care plan also covers any reactionary requests that are made to keep the website updated. 

What's more, Every 36 months Mike’s clients get a brand new website or a website refresh, and that is wrapped up into a cash-flow friendly, predictable fixed price small monthly service retainer. 

Mike’s care plans range from $99 to $199 depending on what kind of business the service is being provided to and he has a 100% success rate on upgrading at the moment. 

In fact his success rate is so good that they don't even bother with a contract anymore! 

Where Is Gherkin Media’s Sweet Spot?

The company's niche is more small to medium-sized businesses who don't have complicated websites, they have a direct relationship with the business owner and don't deal with marketing managers and big corporations. 

If clients indicate that they are not looking for a care plan and support post website launch, Gherkin Media doesn’t take them on. An important process that Mike often does personally is on-boarding each client. 

Mike’s process for on-boarding clients involves the use of a client scorecard (little Mavericks Club hack there) that is made up of some questions that identify their intent for post-launch. 

If after this assessment it's obvious that the client is uninterested in post launch care, then Mike won’t take them on as a client. 

In addition to building websites for clients and wrapping them into a care plan, Mike’s company also takes already made websites that are brought over to their server and wraps them in a care plan as well (such as Shopify and WordPress websites). That's an instant income!

On Mike’s fastest channel, his company can build and deliver a beautiful 5-15 page website that he would pigeonhole in the market as being worth between 3000 to $5,000, in one single day.

Mavericks Club Courses Should Be Used to Suit You!

Mike and Gherkin Media are a perfect example of understanding what elements of the Mavericks business model are right for you. Mike identified that he didn't want to manage larger clients because it didn't suit his team's sweet spot. After joining Mavericks Club he has systematically made decisions about what he did and didn't want to do, and moved forward with what was going to be the best model for his agency to adopt. 

The idea of these courses are not necessarily for you to take our approach hook, line and sinker that's not the point. What we do is show you a strategy to help you get to where you want to be, and it's up to you to decide which parts are useful for you. Don’t just take our word for it listen to what Mike says himself 

Mike's company is hyper-focused on care plans, but that doesn't mean they don't also have growth plans. The company's growth plans are a post-launch product systemisation  they are almost finished developing.

Gherkin Media did have an alpha run of signature systems but found that they didn't make any money – customers got good results but the company wasn't making a profit so they decided that they would close down the signature systems channel and focus on getting high amounts of recurring revenue on a sub of $200 per month for their care plans. 

It's an approximate 90% rule – so if you want 1000 care plans you probably only need 900 people.”

These care plans mean that the first month is covered. Mike sends out his recurring revenue voices and he doesn't have to worry about covering his staff, insurance, cars whatever it may be. Amazing!

What's Next For Gherkin Media?

Mike's aim for Gherkin Media is to close out once he has 1 million dollars worth of recurring revenue, from this point he will close out the care plan product with a discovery session meaning he will get paid to onboard someone into the system. 

The company's ability to take cash flow and use it to buy other businesses is already there for Mike to reinvest in the purchase of new businesses, getting him to where he wants to go faster.  Gherkin Media is already extremely successful at doing this,  whatever projects he decides to take on and the processes that he has implemented in his agency mean that the channel is always open and the company can always effectively onboard new clients and sell their growth plans. 

Mike stated that if he was to start over tomorrow with nothing, he could accelerate very easily to where he is now and he could show us all very clearly that there is not a single unique idea in his business that he came up with. Most of the strategies he has implemented in his agency are taken from Agency Maverick frameworks within our courses. Yay for the SWAT team!

Wrap Up 

So there you have it folks! Building monthly recurring revenue and implementing care plans are a powerful combination. This strategy helps agencies change their business model and develop new, sustainable sources of revenue. Care plans don’t require a long-term sales process, increase retention rates and make it possible to have recurring revenue streams that help reduce business risk.

Mike has very kindly agreed to speak with us again and show us all what he would do if he had to start from nothing and had 3 months to pull it all off. He will be outlining his process for identifying opportunities, care plans,  position and growth within the framework of how he buys businesses as well. 

So stay tuned to learn more about how the Agency Mavericks frameworks can completely transform your agency and help you create sustainable recurring revenue cycles! 

The Agency Hour Podcast

Check out the episode of The Agency Hour related to this blog.

Episode 42:

Listen to the full podcast episode related to this blog on why we need care plans in 2022 and what they can do for your agency! 

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Troy Dean

I am the Founder of Agency Mavericks. The reason I get out of bed every day is because I love helping people to grow their web design or digital marketing businesses. I do this through coaching, creating courses, speaking, consulting and heading up our awesome community.

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