At Pardot we debated internally whether or not we should offer professional services to our customers. Our services team did an amazing job with implementations and onboarding while our customer success team regularly checked-in with customers to proactively help. Only, customers would ask for more services like custom work with email templates, inbox deliverability, landing pages, and nurture programs. Our recommendation: work with an agency partner.
In hindsight, we missed out on an opportunity. Startups should have a professional services strategy. Here’s why:
- Stronger Relationships – Professional services are a great way to build stronger relationships with the customer as it requires more one-on-one time and a deeper understanding of their business.
- Additional Revenue – Professional services result in a new revenue stream. While not as high margin as SaaS, professional services often has strong margins, especially when done as a true add-on (some services are a loss leader to make a product sale). One key point: services revenue shouldn’t be more than 20% of total revenue otherwise the company doesn’t look like a true SaaS business.
- Product Ideas – Professional services becomes a day-to-day user of the product resulting in more product ideas and use cases. This internal team acts as a new customer voice.
Entrepreneurs would do well to develop a professional services strategy for their company, especially when there’s enough scale and existing customer demand to make it worthwhile.
What else? What are some more thoughts on professional services in a startup?