Running an agency isn’t very different from running a startup. I know, because I’ve done both, and the lessons are the same still. One particular framework that startups use often that agencies don’t know about is the AAARRR framework. The AAARRR is known as the Pirate Metrics and stands for Awareness, Acquisition, Activation, Retention, Revenue, and Referral. We’ll dive into each one and how it applies to startups and more importantly how you can use it for your agency.
Awareness lets the world know that you exist. It’s the first step in the product life cycle and is often times associated with product launches. So if you’re a startup, you can launch on ProductHunt to bring awareness. It’s also the step where you create content to boost your SEO ranking and bring in more visitors to your website. The important part of this step is to track website visits and how often people are googling for you online.
Startups will create content, launch on ProductHunt, and tell their audience what they’re working on. And Awareness doesn’t happen only once. It’s a continuous cycle that you do as often as possible. With startups, that’s with every product release.
Agencies can utilize this by launching on ProductHunt, Twitter, and Linkedin just like startups. The important part is to launch where your customers hang out. If they’re at conferences, book a ticket and present there. Startups raise awareness on every new product release. You should raise awareness on every project completion. It’s important to let your clients know your work needs to be available for them to share on social media so others can see you actively launching again and again to bring awareness.
A great idea for content is to create a study that can help your customers. For example, if it’s startups, you can create a guide called “Common UIUX mistakes startups make” and give it out for free for anyone who gives you their email. Which brings me to Acquisitions.
Acquisition happens when you get information about your customer. This can be a signup on your website, opting in to your newsletter, or giving their email to get content. The important step here is to get detailed information about who they are. Here’s the primary things you should focus on getting.
It’s only 4 points and you can add more, but think twice if you’re making it a long form. If you make it too long, they’ll bounce and not care.
Startups use this step to create signups on their software so they can put them into the next step, Activation. They also create content that you have to input your email to gain access. A good example of this is Intercoms book series. Each book is blocked behind an email form and this helps them put people down their acquisition funnel.
Agencies should create content similar to Intercom. If you’re targeting startups, write content on how they can better their products. Spill your secrets and watch people realize how difficult it is to do what you do. And they will end up hiring you because they’ve come to respect you as an expert. I also recommend starting a newsletter using Substack or Beehiive. Share your knowledge with the world and put it behind an email form. Make sure you to release FREE content as well, or else no one will ever know how good you might be. Think of the free content as a trial.
The activation step is where your product or service comes into the play. Customer experience matters the most here. You cannot put a half baked product together with crappy design and expect the customer to go “WOW!”. The standards in 2024 is high. Quality design, onboarding, and getting to that “Aha!” moment is what activates them.
Startups focuses on a great onboarding experience. If you ever used a SAAS where they threw you into the software with no onboarding, you’re left confused with no idea how to setup. But the ones that have a 5-6 step by step onboarding. That’s ❤️. Customers wants a guide that helps them through the product.
Agencies should focus on getting value to their customer as fast as possible. This often means knowing what your new customer wants you to do. The last thing you want to do is have them pay and then wait an entire day to submit their request. They want to pay → submit a request → review your work → approve it. They DON’T want to wait for an invite to your project management software that requires them to make another account to get you to do your job. Too many steps. Too many signups. Too many delays. That’s a crappy customer experience. Give them a seamless one.
So how do we achieve that? Well, one way is to use a software like Queue to setup your clients workflow. With Queue, you can create a checkout page that lets them pay and get sent to their very own client portal where they can submit their first request. You can customize the task form they fill out so you get the clear picture and they get to their WOW and AHA moment way faster. And best part is that the client can message you, manage their payment plans, review work, and so much more from one place.
If there is one step that most agencies will ignore, it’s this one. One that startups won’t, is this one. The reason why most startups won’t ignore this step is because it’s lost revenue because most of their customers are on a subscription. Agencies tend to ignore this way more than startups if they’re on a contract. However, a lot of agencies are going the productize service model where they offer their services for a subscription, so losing a client means losing future revenue.
How do we increase retention? There’s some key fundamentals for increasing retention which I will list below. Customer support means you have to get back to them fast. I’m a startup founder and we will always attempt to get back to our customers within 15 minutes. We hate email because it’s not real time and causes delays. So we instead have a live chat widget on our software so customers can send us a message and get a response faster. Customer experience is how the customer feels when they use your product or service. Do they feel like they’re with pros? Customer results is the most important step. Are you solving their problem? If they need a webflow website done, are you making that happen? Or are you half-assing it so you can go watch Netflix? If you are, they won’t stick around.
Startups optimizes for retention by making sure they provide high quality support using live chat, a great experience by having a smooth onboarding flow, and great results by solving their problems. If you’re able to do these 3 things, you’re set. If you’re missing one, you’ll struggle (god forbid #3).
Agencies should focus on all three as well. Add a live chat widget to your homepage and their client portal so customers can message you with questions. Provide a great experience by helping them onboard so you can send your first deliverable as fast as possible. And finally, give great results. Don’t half-ass anything and your customers will notice it and stick around. If you want to provide the best support and experience, check out Queue to set that all up in less than 5 minutes.
If your customer has been with you more than a couple months, chances are they like what you do and might like other things you offer. Most people don’t do this type of sales strategy. They assume the client is here for only one thing and they might not buy anything else. Newsflash. They hired you for one thing, yes, but if they like your work they’ll be open to purchasing your other services.
Startups upsell by having their account managers reach out to their customers they have a relationship with to see if they have other problems they can solve. For example, at Queue we reach out to customers who have been with us for a few months to see if they’d be interested in bringing the rest of their organization to Queue. Often times it’s 1-2 people that join Queue, but the rest of their team isn’t using us, yet. So that’s where we come in.
Agencies should reach out to clients to see if they need help with similar services they’ve purchased. So if you’re a webflow designer, you should build a partnership with copywriters to so you can offer that as an add-on. Your copywriter gets a cut and so do you for bringing in the customer. It’s a win-win-win for everyone. That’s just one example. If you’re an expert in graphics, then offer them graphic services as well. You’d be surprised how intrigued they will be since they already trust you to deliver great work.
If you’re not actively reaching out to your friends, clients, family, or even your dog for referrals. You’re doing it wrong. Referrals is the #1 way most startups and agencies grow. Why? Because people trust their friends over you. Most agency owners think that if they provide great service, clients will recommend them. Yes, that is true. But we can amplify it and create incentives to increase your odds of referrals.
Startups can utilize referrals as a powerful strategy to acquire more customers. When satisfied customers refer your product or service to others, it not only brings in new leads but also builds trust and credibility. To encourage referrals, startups can implement various tactics. One effective approach is to create a referral program that incentivizes customers to refer their friends or colleagues. This can be done by offering discounts, exclusive access, or other rewards for successful referrals.
Agencies can utilize referrals a lot easier than startups. Similar to startups, agencies can implement a referral program to incentivize their existing clients to refer their network. By offering rewards or discounts for successful referrals, agencies can motivate their clients to spread the word about their services. Additionally, agencies can actively seek partnerships and collaborations with other companies like Venture Capital firms for example. Being able to offer a discount like 20% off for their portfolios is a big value props. Another example, a web design agency can collaborate with a content marketing agency to offer a comprehensive package to clients. This mutually beneficial partnership can lead to cross-referrals and expand the customer base for both agencies.
Did you know Queue has a built in referral program? It takes less than 1 minute to set it up and it will automatically reward both the affiliate partner and referred client. Here’s a video guide on how it works.
The AAARRR method was designed for startups, but it’s a framework that can be utilized by agencies for massive growth opportunity. The great part is that this gives you a systematic framework on how to think through the customer lifecycle.
By following the steps of Awareness, Acquisition, Activation, Retention, Revenue, and Referral, agencies can strategically enhance their operations and drive sustainable growth. Each step plays a crucial role in building a successful agency.
Awareness allows agencies to establish their presence and reach a wider audience through product launches and content creation.
Acquisition focuses on gathering important customer information to better understand their needs and preferences.
Activation ensures that the agency delivers a seamless and valuable customer experience, leading to customer satisfaction and engagement.
Retention is often overlooked but essential for agencies to retain clients and secure future revenue. By providing top-notch customer support, a great experience, and delivering outstanding results, agencies can increase customer loyalty and prolong their relationships.
Revenue presents an opportunity for agencies to upsell additional services to existing clients, leveraging the trust and satisfaction they have already established.
Referral, the final step, enables agencies to tap into the power of word-of-mouth marketing, encouraging clients to refer their network and expand the agency's customer base.
That’s it for now. Good luck!
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