We’ve seen it time and again: many successful digital product companies started as service businesses. It seems like they “simply” transformed their service into a digital product, reaching thousands more customers.
Naturally, it makes sense for you to consider how to turn your service company into a digital product.
The reasons are obvious: scalability and the ability to serve more clients.
Let's explore how you can achieve this.
Turning your company into a tech product
The primary reason to consider this transformation is scalability. You want to serve more customers with your service, so you're thinking about automating parts of your business.
This can take different forms, such as a platform where customers can log in and perform tasks you used to handle manually, or turning complex spreadsheets into an app combined with automations for your internal processes. In any case, this minimizes your manual work and creates a scalable service.
Many companies have transitioned from manual service businesses to digital companies, now generating millions of dollars.
However, it's not as simple as flipping a switch and scaling to millions in revenue. Development is the easy part; strategic planning is crucial.
Where to Start?
You might already know where to begin. After performing services manually for a long time, you likely have a list of tedious tasks or customer feedback that can be transformed into a product.
If not, strategic planning can be helpful:
Map out your customer journey
Start by mapping out your customer journey, answering questions like:
- Where did my customers come from?
- How did they find out about me?
- How did they decide on my service?
- What happens when they buy?
- What’s their role when I service them?
- What happens afterward?
Let’s look at a fictional example:
Suppose you provide a real estate rating service. Today, customers might send you their property data via email, which you manually put into a spreadsheet to calculate values. You then send the results back via email.
Your customers typically come from social media and choose you because of your 20+ years of experience and good reputation. Usually, they buy the service through your website and then wait for the ratings.
To productize this service, you could create a simple platform where customers input data directly, receive immediate calculations, and get their ratings instantly—without you doing the manual work. This not only improves the customer journey but also saves you time by automating the process.
By mapping out your customer journey like in the example, you can identify such bottlenecks and opportunities for improvement.
Find out what your customers really want and need
Mapping out the customer journey is helpful, but it only gives you an indication. To build a successful product, you really need to know what part of your service is most valuable.
Identify what brings the "AHA" moment for your customers. If you can put this part of your service into a product, you will win.
In our real estate service example, the rating result is what customers want and where the AHA moment lies. Building a product like a platform around this is what would do the job.
So, before starting, it's best to dive deep, conduct interviews, and gain insights to really identify the "AHA" moment, and then productize around it.
Map Out Your Processes
This step is crucial as it reveals which parts can be automated and transformed into a product.
Using our example, the process might look like this:
By identifying where manual work occurs, you can see what processes can be automated or performed by customers instead of you doing the manual work:
This mapping gives you a clear picture of what can be turned into a product.
Turn your service into a product
With a better understanding of your customer journey and processes, you’ll likely see which parts can become a product and how it might look.
In our fictional example, it could be a simple platform with forms and a calculator. Customers then upload data, fill out the calculator, and get immediate ratings for their properties. This improves their experience and saves you time and money.
Whether you plan to build a platform, an app, or a customer portal, strategic planning is essential. It's like building a product from scratch but with the advantage of existing insights from your experience.
By the way, no-code development tools are ideal for this kind of product. They allow you to create digital products without coding knowledge, simple and affordable (read here how to build a first version of your product with no-code).
"My service can’t be turned into a digital product"
What if you can’t find a solution because your service is too complex and involves too much manual work?
The answer is: focus on making your service more efficient rather than turning it into a product. Automate parts of your internal process or build an internal tool for yourself.
This could be a CRM tailored to your needs that automates customer data management, or a user-friendly app that replaces complex Excel spreadsheets.
The possibilities are endless, and any of them will save you time and money, as shown in the case study from Stewardly. Instead of managing assets in complex spreadsheets, Stewardly now manages them with a user-friendly, easy-to-use platform.
Examples of service Companies that turned into tech products
There are some pretty famous examples of service companies who turned their service into a product. Some of them based on their own needs:
37signals
Originally a web agency, 37signals shifted focus to SaaS products. Their first commercial application was Basecamp, a well-known project management software. Read more.
SEOmoz
SEOmoz founder Rand Fishkin started with a web agency including SEO services. Struggling with third-party SEO services, they developed their own. Today, Moz is one of the most popular SEO tools. Read more.
Hootsuite
The founder of Hootsuite originally had a marketing agency. The tool was developed to manage social media for the agency and customers. Now it is one of the most popular social media planning tools. Read more.
Netflix
Netflix launched in 1997 as a DVD rental service. Subscribers could select movies through the website and receive discs by mail. Read more.
Final Words
Turning your service business into a product or automating parts of your internal process can be crucial for scalability and serving more clients.
It requires strategic planning and testing, but once done, it's incredibly rewarding for your business, as shown by the examples above.
But remember, some people will always prefer manual services, but the potential to reach many more clients makes it a risk worth taking.
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