Are agencies becoming Saas companies?

The rise of artificial intelligence (AI) and no-code technologies means the boundaries are blurring between service and product, billable hours and passive sales, tradition and innovation. But is this the new gold rush, or fool’s gold?

Turning process problems into Saas solutions

Ed Roberts is partner at We Are Systematic, a digital product design agency. They built and launched ProductSweet, an idea management platform for product owners.

“We looked at the market and realized there wasn't anyone offering a platform like this, so we built it ourselves. We specialize in evidence-based design and ProductSweet is almost the productized version of this. We use it on our own projects and are now launching it for others to use on a Saas basis as well”.

In the crowded agency space of similar claims and cliches, having your own Saas product gives you an instant competitive advantage.

It gives you two routes to market: the traditional agency new-business model and the digitally-driven Saas model. When done right, the service offer and Saas product intertwine seamlessly as part of the overall proposition.

The client wins because the product simplifies and strengthens their project. The agency wins because its workflow becomes streamlined and cost-efficient. And when the Saas product itself is commercially viable externally too, the agency’s eyes light up at the potential scalability.

Getting creative with AI and Saas

Saas platforms have always looked to disrupt traditional agency markets, from CRM systems to social media scheduling and beyond. But recent acceleration and accessibility of AI have seen agencies looking to launch products that harness this power, from ideation to execution.

Client curiosity in AI has grown rapidly, but many lack the expertise or headspace to get deep into the tech itself. Instead, they’re happy for their agencies to present innovative ways it can be deployed to deliver better results.

Blair Richardson, business director at Rehab, has spent over 18 years watching how “great innovative brand ideas often live and die in pitch decks”. To overcome this, the team built a managed service platform called Triage that uses AI to “automate a flow of hyper-relevant creative ideas, sparked by real-time tech, culture and competitor signals”.

Whereas traditional Saas products often look to streamline the more mundane parts of an agency’s processes, Triage works on creative ideation; drawing ideas and influences from a brand’s previous partnerships and campaign concepts - both live and rejected.

“We’ve seen a lot of ‘wow’ moments and ‘mind-blown’ statements when showcasing the platform as people are astonished that it’s able to create ideas that are indistinguishable from human ideas.”

This throws up some interesting existential questions for agencies about the fading division between products and people. Right now, the general sentiment is that human strategy is still needed to steer the robots, but check again in a year or two and our digital overlords might have censored this sentence.

The challenge of selling both service and software

Creating your own agency Saas product sounds like a smart play. In theory, it means more leads, more entry points, more efficiencies, etc. But as with anything worthwhile, it comes with risks and costs.

Firstly there’s the market validation. Many agencies believe there’s a desire for their product when the only real market is their internal teams. Then there’s the design and build. If you’re a digital product studio, this should be in your wheelhouse and can be a great proof of concept.

But for others without the technical capacity, this can be a massive time and cost drain. The finances are also a factor; R&D, design, prototyping, testing, launching, marketing, optimizing, bug-fixing, marketing, demo-ing and selling. On top of this, external positioning can end up confusing as to which side of the business is the priority. And lastly, there’s dealing with new customers with new types of queries.

Jake Grimley moved from his role as chief exec and founder at Made Media to focus on scaling CrowdHandler, the online waiting room and virtual queuing product originally created for large performing arts and live event clients, and now used by brands across a range of verticals.

“Quite often we’re being deployed last minute, at all hours, for new customers who have questions or technical needs. Living to deal with this as business-as-usual is a challenge; however, our agency skills around account handling and project management come into play.”

Cash in the bank, or flash in the pan?

The line between traditional agencies and digital products will continue to blur. Now’s the time to start looking into how it could work for you. If you’re not experienced in building digital products, start with simple no-code Saas and app-building tools like Bubble, Appsheet and Backendless. Think about parts of your process that are time or labor-intensive, or that regularly become a barrier to project completion.

Avoid going too big or broad too soon, and focus on building something useful. And remember, not every Saas product is destined for commercial success and maybe that shouldn’t be your primary goal. Because entrepreneurial agency people love to get distracted by the latest shiny object, and not all that glitters is gold.