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Review my business model

by misc92
6 replies
I would like to share a simple business model today. I would apprecite your feedback.

Business model:
- Find an specific niche/industry controlled by SMEs. Car Dealers, lawyers, churches, real estate, etc...
- Then proceed to offer them a turnkey website solution. You essentially provide this businesses the same theme but rebrand it according to their corporate identity and customize it with their data (which should be similar for every player in the niche)

- Rent this website for $100 USD monthly with a contract requiring a minimum commitment of 12 months. The $100/month includes: hosting, domain, right to use your platform (theme), technical support, right to have the site edited 2 times per month by my company and .


In my country I have detected a company that has already signed up 650 firms to their service, charging around $60/month. They make $500k a year, and their websites look straight out 90s, non responsive with heavy flash use...

In the USA I have detected plenty of companies doing it as well.
- Placester for real estate websites: https://placester.com/
- Car Dealer websites, 16k clients *99/month: https://dealers.carsforsale.com/
- Church Websites:


What do you guys think about my Websites as a Service model? It is not the most innovative business model but it looks pretty profitable and scalable. Feedback is appreciated.

When the client base is large enough and my authority is established, I would proceed to upsell them other digital marketing services (PPC/Social Media) and eventually partner up with a software company in order to upsell them a cloud CRM solutiom.
#business #model #review
  • Profile picture of the author isaacsmithjones
    I'll try (and probably fail) to keep this short...

    I don't like the model because it seems like you're tricking people into a year-long contract, that doesn't provide them much value. That's why you need to LOCK them in.

    This means that at the end of the year, they're gonna leave you if they have any sense. If you focus on what you can GIVE the customer, rather than what you can get from them, then it will make your job much easier, and they will WANT to stay with you, month after month.

    As a consultant, you should know how to earn your clients money, or help them to achieve their bigger goals. This is what they value.

    Rather than trying to generically charge people $100/month. Work out how much you can earn for them. With the current model, you're only really gonna earn $1,200 - $1,800 per client (lifetime value) on average.

    Instead, when you speak to a prospect, charge them based upon what you can earn them. If you can earn them $20k using your services e.g. Lead gen website and PPC, then that client is easily worth $4,000 to you over the next year. Not only that, but they're gonna stay with you, because they know that you earn them more than you cost them.

    This makes their lifetime value more like $4,000-$12,000. Up to 10 times more than the model that you mentioned. All by putting the client first.

    With the model that you mentioned, you'd need 84 clients to hit $100k. 7 clients per month. With a total lifetime value of up to about $150k

    Using the model that I mentioned, you'd need 25 clients to hit $100k. That's only approx 2 clients per month. With a total lifetime value of up to about $300k.

    And if you learn where to find the most valuable clients, you can even smash the example that I gave you. And you don't need to be some big time guru to start getting these kinds of clients either.

    I explain this model in my post on earning a £20,000 client.

    And Jason Kanigan goes over a similar process in his 3000th post.

    This type of selling helps you to overcome "price objections", raising your value per client.

    This gives you:

    * More money
    * Happier clients - who stay longer, and pay more
    * More referrals - clients are happy to brag about you
    * Greater satisfaction - No need to feel like you need to lock people into contracts, because they WANT to stay a client.

    Well, I hope that this helps you to make a better informed decision on the model that you choose. Good luck with your business.
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  • Profile picture of the author Peter Lessard
    The key here is there is NEVER anything simple about a business that makes 500k+.
    Sure it is easy to understand but rest assured there is one hec of a sales force and support force behind these business models.

    I have no issue believing that one can duplicate what someone else is doing.
    The issue is generally that you really do not know upfront the true investment in time, money and skills to get it done and most fail because they are lacking in one of those areas.

    It is really no different than saying what do you think of this business model.
    You build something like McDonalds, put one on every street corner and check out how many hamburgers you can sell :-)
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    • Profile picture of the author tarpontim1138
      What if you offer your same services as you outlined BUT changed a few things?I would offer them a semicustom website just as you are but make sure they have a strong call to action on each page.
      I would invest in time and effort on both the on and off page seo to get them ranked well on page 1.
      Do not have a contract
      Install a call tacking number with "call whisper" so that they will know each time some is alling from the website. Also email them a report at the end of each month to show how many calls came from the site.
      Guarantee them results or they can cancel at anytime.
      If you can get their phone to ring with good customers you will not have to worry about them leaving.
      You can guarantee a certain number of leads each month. I would't, I would just guarantee them you will get their phone to ring with customers and your call tracking system will prove it!
      If you are making sites from contractors, they will only need to land one kitchen, bathroom remodel.... to make way more then enough money to make this a no brainer.
      There are a ton of service compaines (plumbers, painter, contractors...) that do not have a website and would love to have a online presence that makes their phone ring with No contract and Guaranteed.
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  • Profile picture of the author misc92
    Thanks for the feedback guys, im going to be primarly focusing on auto dealers and real estate firms/agents.

    The reason why i want to lock them in a contract is because the cost of adquisition of each client is larger than 1 month, if he leaves by month 2 to some competitor, there is a massive loss the business will have to cover. Cant happen if locked in a contract.
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    • Profile picture of the author isaacsmithjones
      Originally Posted by misc92 View Post

      Thanks for the feedback guys, im going to be primarly focusing on auto dealers and real estate firms/agents.

      The reason why i want to lock them in a contract is because the cost of adquisition of each client is larger than 1 month, if he leaves by month 2 to some competitor, there is a massive loss the business will have to cover. Cant happen if locked in a contract.
      If you work with averages in mind, and use "value based" sales, then you don't have to be scared of the people who pay less, or end your services early, because some people will pay more, which averages things out.

      If you're working with a real estate company, and they only earn $4,000 per sale... If you get them just 3 sales in a year, you've earned them $12,000. You could realistically charge them $2,400 for such a service.

      Then let's say someone leaves you really early, and you only earned $300 from them, and then $1,200 from someone else.

      The average of those 3 clients comes to $1,300.

      So although you run the risk of getting low-ball clients... You have the chance of pushing up your average with the clients who are "worth it".

      And if you qualify clients properly, you can get rid of most of the low-end guys anyway.

      At the end of the day, it's your business. But by offering an arbitrary flat rate, you're leaving a lot of money on the table.
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  • Profile picture of the author tarpontim1138
    Are you gong to offer any type of guarantee?I feel it will be hard to sell with a contact and no guarantee.
    If they don't know if it is working yu will have a very hard time keeping anyone once the contract is over. I would try to find a way to prove what they are getting from the site. ex. call tracking, monthly visiors, online orders, estimate requests via a contact form...
    I have seen other companies "lock" customers in and most all of them leave.
    Are you going to offer any seo services to help get their site found? A site that doesn't get any traffic is not worth much.
    I would try to figure a way to implement some seo to get them results from their site even if it costs y a little more. Raise your price to cover the seo.
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