A Profitable B2B Web Design and Digital Marketing Agency with Long-Term Client Relationships and Recurring Revenue
This 26 year old web design, development, and digital marketing agency provides consulting, branding, and marketing support services to clients from professional services and non-profit sectors. With over 55% of annual revenue from subscription-based website service developed for small and medium sized professional service organizations and 20% from custom website development, the agency has a low churn rate of 1.5%. Currently, the agency has 128 clients, and most have been with the company for between 5 and 15 years. The agency has five full-time employees and an additional overflow team of dedicated designers, developers, writers, strategists, animators, and a+udio and specialists. The brand has a strong industry reputation, and in 2021, word-of-mouth referrals from satisfied clients gave them an edge.
OPERATIONS
With over 28 years of experience, the team has developed in-demand services such as brand and project strategy, UX/UI, web development, and digital marketing support. Long term relationships were secured by offering contracts for both one-time and ongoing services. Recently, a new front-end framework was deployed and yielded more design flexibility while opening up new semi-custom approaches.
The agency does not rely on logistics and supplies services since their operations are primarily online and immaterial in nature with no inventory requirements. Their unique SaaS-based platform offers agency-quality designs and tools to their clients at a lower cost compared to custom websites.
MARKETING AND KEY METRICS
The agency is known for producing high-quality and user-friendly websites which are prominently displayed on their own site and are complemented by their unique SaaS platform for small and mid-sized service firms. Currently, the majority of the agency’s revenue (40%) comes from their SaaS-based work and 72% of that revenue is recurring.
Currently, the agency gets around 2,000+ unique monthly visitors to their website. Since word-of-mouth has been the prominent factor behind scaling the agency for years, they can easily drive those numbers considerably higher through digital marketing, such as social media, email marketing, and by running PPC ads on Google to boost their search engine visibility.
The agency serves clients from professional services, non-profits, tourism, and hospitality sectors mainly. The brand’s revenue generated from its website designing business offers a recurring revenue model with 72% of it being repeatable annually. The brand has a sizeable customer base with an excellent client retention rate, and 20% of their sales come from custom website designs.
The brand mainly serves professional services, non-profits, tourism and hospitality sectors, and has an excellent client retention rate, with most of their clients staying with the company for between 5 and 15 years. The brand’s SaaS platform is particularly targeted toward small-sized professional service firms, providing a subscription-based website service that offers high-quality websites and overarching features that such firms often do not have access to financially.
BUSINESS MODEL & RESOURCES NEEDED
The agency consists of five highly experienced full-time employees, including a director of design and development, a senior architect and tech lead, a designer, a developer, and an account manager to run daily operations. An overflow team of designers, developers, writers, strategists, animators, video/audio, and specialists is utilized during busy periods.
THE INDUSTRY
The online web-design and digital marketing industry is highly competitive. Professional services firms that are dependent on delivering their business through the internet are the revenue-driving segments of this industry. The need for designing and developing websites for branding, lead generation and customer retention is increasing continuously, which ensures future growth of this industry. Moreover, innovative tools such as SaaS-based platforms are adding value and demand to the industry.
OPPORTUNITIES TO SCALE
The brand has a loyal customer base and retains 10-15 years of average client lifetime with a very low churn rate, which offers significant opportunities for scaling. Digital marketing could boost their existing clientele as well as outreach to potential customers. They could also leverage their position and expand into other professional services industries. Developing multiple online tools and custom website design could effectively increase the revenue generated by the brand.
Asking Price: $775,000
Gross Income: $890,904
Cash Flow: $189,758
Year Established: 1996
Employees: 6
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