Are productized services or subscriptions the future of Graphic Design Agencies?
With the sudden influx of design agencies selling design subscriptions, we are officially in the era of productized services. Is this the future of design agencies, and is the shift coming in 2024?
While many of us would argue that subscriptions are the "sell-your-soul-to-the-devil" version of retainers, we think there's a bit of a difference. If you go to X/Twitter, many freelancers and small design studios are talking about design subscriptions. However, the trend is not just limited to design; other disciplines are jumping on the bandwagon, too. A typical range of these design subscriptions starts from $2500 per month and goes beyond well over $25 000 with different tiers offering different kinds of services - one thing that stands out is "Unlimited Revisions." Many established freelancers and design studios disagree with the option of "Unlimited Revisions." Still, it attracts a client who wants to pay a $5000 flat monthly fee to complete design tasks.
What makes these subscriptions so appealing:
- Unlimited revisions.
- Unlimited requests.
- No meetings.
- No commitments.
- Pause or cancel your subscription anytime.
- 24-48 delivery.
Many people ask, "why would I pay $5000/mo for something like this?" The answer is simple - if you're looking for a bespoke, one-of-a-kind design experience that would smash the Awwwards website and break X for you - that's not happening, or perhaps it would! But good things take time (if you think you can do a mind-boggling design in 48 hours that can break the internet, we'd like to hear from you). These services are basically for your day-to-day tasks.
Let's say you have an infographic that you want to create - you got it. Or a brochure for your DTC pet brand - you see? Tiny, little things that you can't do yourself and the frequency of this kind of work is also healthy. Now, it makes sense.
In other words, this service is for you if you're a small business and don't want to hire someone permanently for an entire year and pay all the benefits, etc. If you expect to get a whole brand design, with a 10-page website and a pitch deck for $5000 a month - that's only possible if you have an extended deadline and you can keep the subscription running for months and months. The reason is - the subscription-based models usually only accept "one" request at a time. It means you can have multiple projects in the pipeline, but the agency will only fulfill one at a time. Hence, there are more reasons to go with a small-but-many requests approach to get the best deal for your money. Also, you can cancel and pause at any time - no strings attached.
But is this the future of design studios?
Let's see - the giants like Koto, WolfOllins, Pentagram, RaggedEdge, and DesignStudio don't seem to be going in that direction soon, and we don't think they can sustain their business with a subscription model - although, if they tried that - the results could be interesting; they could potentially play the volume game, but it's safe to assume that's not something that would interest them at this moment.
It all comes down to solopreneurs, late-night hustlers, freelancers, new design studios, web flow/framer developers, UX designers, illustrators, video editors, SEO experts, and thousands of others severely affected by the mass lay-offs this year. This model gives them a chance to bounce back - the talent is undoubtedly immense, which will attract and find the right client as well.
Let's look at the few benefits of subscriptions or productized services:
Play the volume game:
If you can focus on providing value and volume simultaneously, you can potentially play this game. Of course, as you scale - you'll need to hire the right talent. The reward, in this case, can be pretty good. It all depends on you and how much you can pull off. We have seen solo designers making well over $20 000 per month (some have claimed over $100 000/month as well). Although the price is low, it can be one way to generate profit if the quantity is substantial.
You can predict your revenue:
Design subscriptions can become a steady and reliable source of revenue. With a clear yearly goal and the proper funnel to find new clients, it's quite a stable structure that could easily (with hard work, of course!) can get you to your annual financials.
A hybrid model:
Selling design subscriptions allows branding and design agencies to diversify their revenue streams. At Hustle Jar, in addition to the traditional project-based work, which starts at $25 000, we also offer subscription services to our clients who want some post-project love (platonic, of course). This is the hybrid model we have taken, as we love doing bespoke branding and web design. We're not a full-subscription-based agency - we have only replaced our retainer model and made it affordable to attract new clients seeking design support or current clients with their day-to-day needs. We don't sell "unlimited revisions." All of our clients are highly vetted; if we like their vibe and they like ours - then we jam!
The new retainer model:
While established freelancers would argue that this is not a retainer, the reality is that they somewhat are. Previously, a freelancer or a small studio would offer a retainer as an additional part of the project's scope - which they would label as the "maintenance" phase. The scope would include the total number of hours, the dedicated resources, and the set number of tasks. This "maintenance" phase would be significantly lower in cost than the price of the main project -> this is precisely what subscription services are doing: they provide and fulfill the tasks that would usually be in the "maintenance" period.
If agencies or design studios offer advanced services like product design, app design, and development, they charge them accordingly. For example, off-menu design studio charges $15 000/month to $25 000/month for web and product design services.
It is a bit early, and we can't say for sure that this is the future of design studios, but the way the newly laid-off talent is entering the workforce seems to be a viable model, and we're here to support it!
Here are a few friends of ours offering subscription services
Design Fuel - Web and Product Design
Orange Studio - Digital and Web experiences
UXKosta - Web Design & Framer Development
At Hustle Jar, we specialize in combining creativity with data - crafting compelling brands that narrate amazing stories and drive business results. Whether you're a new startup looking to launch your first product or an established business looking for a brand refresh, we're here to help. If you are intrigued to know more, let's grab a coffee nearby or online, whichever you prefer.
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