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Evolution of a WordPress Agency

Apr 28, 202549 minEp. 96
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Episode description

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In this episode of the WP Minute+ Podcast, Matt speaks with Ross Johnson, founder of 3.7 Designs, about what it’s like to run a WordPress agency for nearly 20 years. Ross shares the lessons learned from starting his agency in the early 2000s, evolving from general web design to custom WordPress development, and ultimately shifting toward modern workflows with block-based builders and recurring revenue models.

The conversation explores practical agency management topics like the cost of custom development, experimenting with new tools, working with clients of all sizes, and the ongoing debate over what defines a “WordPress professional.” Ross and Matt also discuss the role of version control, the rise of AI in agency workflows, and how to adapt to the changing landscape of customer expectations, marketing strategies, and sustainable pricing models.

Key Takeaways

Agency Growth and Sustainability:

  • Ross founded 3.7 Designs in the mid-2000s and has adapted through major WordPress and industry changes.
  • Experimentation and reflection are critical to long-term agency growth and process improvement.
  • The shift to retainers and recurring revenue has helped the agency survive economic ups and downs.

Custom vs. Page Builder Workflows:

  • Building everything from scratch led to budget overruns and development fatigue.
  • Tools like GenerateBlocks offer efficiency without sacrificing flexibility.
  • Page builders don’t diminish professionalism – they enhance it with the right strategy.

Defining a WordPress Professional:

  • Caring about your craft, clients, and business is key to professionalism.
  • Version control is helpful, but not the only marker of expertise or quality.
  • The community should avoid exclusionary definitions of “real” developers.

AI, Marketing, and the Future of Agencies:

  • AI is a valuable assistant, but not yet a full replacement for development or marketing teams.
  • AI can accelerate ideation, design, and content repurposing across multiple channels.
  • Agencies that lean into human connection and high-touch service will differentiate themselves.

Important Links

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Transcript

Matt

Ross Johnson, welcome to the WP Minute,

Ross

Hey, Matt. Thanks for having me on.

Matt

here to talk about all things, why I still run a WordPress agency in the year 2025.

Ross

I, I ask myself that quite often, to be honest.

Matt

how long have you been running your agency?

Ross

Quite a while. I officially registered the, it was a DBA initially in like 2005. I think I had like one project early 2005 that didn't go well. Big surprise. And then, really didn't pick it back up until maybe early 2006, so kind of pushing officially 20 years now, which is wild to say. I'm feeling pretty old.

Matt

Nice. Nice. lots of has changed. Lots of change. Lots of have stayed the same. And, you know, to, to like frame that, like, of course like technology has changed, like the politics of of WordPress have changed. competitors have come into the space, like AI have changed. But I would also argue that like servicing customers, even in the face of all that has. Probably stayed kind of similar to like when things started air quotes 20 years ago. And I wanna dive into, all of that.

But before we do, let's give you the kudos first. Where can folks go to find more about you and your agency? What's the best place, that they should visit?

Ross

I think just, our website, which is three period seven designs do co three period seven designs at co. So it's 3.7 designs and we officially own seven designs that CO. And three is a subdomain.

Matt

Nice. Nice. so 20 years ago, WordPress was, was quite different. you were servicing customers that were, well, I'll let you define it. Did you cast a wide net like I did and just pull anything back onto the boat that said yes. And how did that like change over time for you?

Ross

Yeah, pretty much. You know, when you're starting off, and I was pretty young, I was in my. Kind of mid twenties at the time. yeah, it was really basically anybody who would say yes. I was positioning myself more as like a designer at the time. even though I had a strong background in technology and like my first client was, was more or less a website, like I was doing it. And, and when you're doing it in the nineties, they're like, wow, you do the website too.

And I found I enjoyed that a lot more than like troubleshooting email. but I. Yeah, it was more of a designer. There's like the, the direction I was going in. but it ended up being more and more web like. That's where kind of based on my age and getting into the market, like a lot of the clients I was running into wanted to hire more of like a bigger professional design company compared to a 20-year-old to do like their branding.

but they had no problem handing off the website because that was new. but yeah, to start it was just anybody who said yes. so it was all over the board. And then, you know, it. It's, it, it's, it's interesting how it changes and, and everybody says you should niche down, and we're kind of only getting to that point now, but your, your clientele always changes, right?

Like, I'm sure you experienced the same thing, like the first people you're talking to, even if you're not picking an industry compared to like who you are talking to, like a year or two years, or three years. Like their characteristics change. And that's certainly, you know, what we were experiencing.

Matt

Yeah, that that's, it's, it's hard to prepare for, it's hard for even for me to even like illustrate the advice for an agency owner. I kind of look at it as like, you do 80% of your, like, core work, let's say, on a, on a given week or month, but then like 20% of that time.

I think a good agency owner is also like experimenting either with like experimenting with a new kind of customer or like a customer in a different market or experi or experimenting with like how you are adjusting your own marketing and sales pitch and like adjusting like, oh, maybe we should. You know, we'll use Gravity forms my employer as an example. Like maybe we'll never do this at home kids. So like, maybe we should be thinking about another plugin we should use in its place.

and you're like experimenting with like another suite of tools, which helps like find that customer. Is, is that 80 20 rule, does that stick with you? Or how do you,

Ross

Yeah, I would say so. yeah, generally that, I mean, that sounds about right, like there's, things are always changing and you know, one of the mindsets we have over at the agency is that, you know, nothing is perfect. Like nothing. Everything's basically our first draft. So like everything's on the table to, to change. And it's almost like every time you go through a project you should be.

Thinking about like what went well and what didn't go well and trying to identify places to improve and that includes new tooling. and you know, it's interesting as the, the plugin market has really kind of exploded and I guess over the last 10 years, it's not something new, but, some of the plugins out there that were just like the only go-to solution like Gravity forums or Yost or something like that.

Now there's a lot of really good competitors out there, and I. You know, for us, we found for a long time we're kind of using those same plugins and then realizing we should try some of these other ones because they might be a better fit for our clients or they might be more efficient. and yeah, there is kind of that element of figuring out how do you do that experimentation? Like are you doing it on a client project site? which you could do, but there's certain risks to that.

But you could also kind of have your own desk projects or some sort of process for trying 'em out and evaluating them.

Matt

Yeah. I'm fresh off the heels of a, a podcast I just recorded with, mark Zamanski. And we were trying to like, break down the definition of, WordPress professional because I think he, probably takes, offense is probably not the right word, but he, he wants folks to be like, look, you can't just keep saying like, you're not, you're a WordPress professional if you only do these things. And by these things like commonly thrown around like.

If you're not using GitHub and version control for your projects, you are not a professional. If you're using a page builder, you are, you know, you're not a professional. I see it as different, like maybe tiers of professionalism, that, that sort of, you know, that, that sort of, unfold throughout your experience. And let me just hit you with, with this, with this GitHub and revision control thing, because this was something too, like when I started my agency.

It was just like, Hey, can you build a website for me? Yeah. And you start like hacking together WordPress, and then you discover like themes and you're like, oh, like this theme is a great starter theme. But then you realize like a year later, like, oh, these $69 themes that you're buying from theme forest don't come with any like true support. And then you discover.

Let's say Genesis and Studio Press and you're like, oh, there's like a whole team behind this and you, okay, like this makes sense. And then you load onto that, right? And then page builders come, right? And then you'd realize like, oh my God, I'm building a big project with multiple people who are working on it. I probably need this thing called version control. Right? So it's just like this long learning journey.

But could I wonder if you can unpack like why people maybe point at version Control as like that next level of like being a professional?

Ross

Yeah, that's a good question. I mean, I, I'm more along the lines of. like my thought process is you are like, I don't think we should exclude anybody based on, you know, a very specific skillset, especially if we're calling using terms as broad as like WordPress professional.

Like in my opinion, like if you're getting paid to deliver value through WordPress, like you're a WordPress professional, like if you have some skills there, it doesn't necessarily have to be that you're a dev, like a developer who writes code and uses version control. I mean, these days I don't do a lot of. Writing of code or using GitHub or version control. But I could still consider myself in many ways, a WordPress professional.

or even if you were to look at like, you know, people who have a WordPress plugin business, a lot of 'em are not developers who are using version control. Are they still WordPress professionals? so I, I think if I had to guess as far as like, why does that get picked out Singularity. It, it might be that, a lot of the evolution in WordPress might have started with.

Developers, and so there is this sense that you're not really using the platform to its full extent if you're not kind of a certain level in the weeds of, you know, getting under the hood and actually writing code and committing it.

Matt

Yeah, I think there's like this, As I was explaining to, to mark on, on the podcast, it's like a fe like the whole like version control thing is like a feature of a professional.

Ross

Right.

Matt

and generally it's associated with, you know, that that higher ticket project, 'cause you're really not using like. If you're building a, a quick five page portfolio site for a local bakery, you're probably not syncing it up to GitHub and, and having a repo, right? It's, it's, it's very easy to be like, oh, that website over there is, you know, when they call in for support, you know, your team knows like, oh yeah, it's cadence. You just log in and you change the font.

They want that change the font to 18 point. Okay, just log into cadence. But then if you have like an enterprise client who. You've built like this bespoke app for with WordPress integrated into some like ERP system that they have, and they ask for a support request. Well, you're not, you're not messing around with like undocumented changes for that customer over there.

So you know, your support team is gonna go well, let's just see like, okay, we're gonna make a change and we're gonna commit it to the repo and it's gonna go to the testing site. And then we'll send that testing site link to the customer and say, is this what you wanted? Enterprise customer who pays me a lot of money? And they say, yes, that's it. And you go, okay. And you, you commit that branch to the main branch of their production site. Right?

And there's a whole process there, even if it was just an H one that you changed,

Ross

Mm-hmm. Right.

Matt

that's the process because that's what, that's what they're paying you for. having said all of that is, is. Is that how you, box customers in, in, in your agency world? Like do you have like those smaller clients and bigger clients, and are the expectations in the process different?

Ross

Yeah, I would say to some extent, I mean, it's, it's not as big maybe as what you're describing, those, those two examples. but yeah, certainly we've got one client that's like exactly like you described where if we're gonna make any small change, let's go through like multiple steps of, you know, we're pushing it. You know, we're working on a dev site. We push it to staging, they have to review it there, then it has to be accessibility, tested this to be a security scan.

Then we can't deploy the code. We put in a ticket and then they deploy the code and then there's like a testing process after that. and then we have other clients that, yeah, they're just like, do it like they have the controls. They could log in, they know how to change it, but they, that's not what they're, they want to do with their time. And it's interesting, it's not necessarily, I mean, for us, 'cause we don't work with like a whole lot of like really big enterprise clients.

like Fortune, you know, 500 sort of clients. But, you know, there, there isn't like a huge distinction between how much they're paying and their expectations. It's, it's more just, kinda how their IT department seems to like how much they care or wanna have their hands in the process. but that's just us personally.

But you know, to, to take a step back real quickly, you were talking about, you know, version control and those two different examples and it occurs to me like it, it's an interesting question of like, how do we even define version control because, you know, is using the backup system in your managed hosting version control. I mean, if you have a mostly database driven website, like something built in cadence, I'd argue it is.

So are we kind of narrowing down that like you're not a professional unless you're using like this very specific type of version control. And I think that's, you know, pretty exclusionary. I think there's a lot of professionals out there doing great work who aren't necessarily even need to do that. Mm-hmm.

Matt

I ca I came up with like the three C's of, professionalism, which, made sense in my head when I came up with it, but now it doesn't make as much sense as when I say it out loud 10 minutes later. but like the three C's of like, like you care first and foremost, like it, you know, presenting the question of like, what makes up a WordPress professional or I guess any professional in, in, in my eyes is like. You care about the work that you're doing, number one, like.

That means that like, this is a pursuit. we said the 80 20 thing before, it's like, like that right there is like the evolution of caring. Like I care about the work that I'm putting out because it satisfies me. It satisfies, you know, others and I'm constantly like trying to make this thing better. I care about the work. Second, C is like, I care about the customer. Like I care that this work that I am constantly refining this craft.

I'm constantly refining, like I'm putting that to good use for the customer, and they're asking me questions. I'm answering it. Can I solve this for you with the stuff that I know? Yes. And if not, maybe you should be saying no in that. In that second phase and saying like, Hey, customer, like what you're asking for is not me. Maybe I'll go find somebody else for you, but, it's not us. And that's like caring about the customer. And then the third C is just like you care about your own business.

Like you care about the sustainability of your business so that all this hard work you've put, you know, into learning the first C when you're applying that to caring for the customer, it's profitable. And it's, it's there so you can survive. So the business can, so the business can be there to serve that customer, not just now for the website, but a year, two years, five years later. I'm sure you have customers that have been with you forever, since you started your agency.

and that's an important thing. That's how I've defined it. Those three Cs, would you add to that or do you see it a different way?

Ross

No, I think that makes a lot of sense. I, I wouldn't necessarily add to that. I mean, the way I typically think about it is, you know, if you are, yeah, I guess if you're delivering value, And showing up for the customer and you're reliable and, helping them accomplish their goals. It really doesn't matter about like how you're going about it. I, I think those things are what define you as professional, not necessarily like the process or the tools or the techniques. I.

Matt

Yeah. Where do you land? we were chatting before we hit record. Where do you land on the page builder landscape? Is that something that you incorporate into your workflow? Is everything built, by hand? crafted by hand? in the north, central North, of the United States? How do you, use page builders for you?

Ross

Yeah, this is something that like, like just in the last few months, we're exploring shifting. so for the longest time everything was completely custom. Like we had our own custom theme, you know, that was a, iteration of underscores and, you know, before Gutenberg blocks we were. Building mostly like complex layouts with a CF. And then a few years ago we decided to lean into, you know, block-based, layouts and started extending and building our own custom blocks.

And we kind of got to a point maybe last year, you know, it occurred to us that why are we reinventing the wheel? Like we're spending a lot of time and money, both our client's money and, and agency money, like. Building and extending these tools, these custom blocks, when there's better solutions out there than what we were building for much less like, you know, generate press, for example.

You can get, generate blocks, I think for like a hundred bucks a year, which is like one billable, like less than one billable hour, you know, for a client. And the amount of time and effort put into, you know, that solution and the amount of, testing that's been done compared to ours, it's just like, it doesn't even compare.

So. You know, with that, and also looking at, I know a lot of people don't love, you know, block themes currently, but like that is a direction in other, platforms that are gaining traction, like web flow. Like personally, I see that as like the future of building websites. I think there's going to be less and less hand coding websites and layouts in CSS, just across the board. Not just websites, but even web applications. Like AI at some point is gonna be able to take a Figma file and like.

Or whatever we're using right at the time, and just build the layouts itself. Like we won't necessarily need somebody to be doing that.

Matt

Right, right. Do you remember how you, how did you come about making that decision to be like, we've got our own tooling. We've been using it for, you know, whatever, 10 years and now we're gonna switch to a more, what I'll call retail product. I.

Ross

basically every single project we quote, we went. Way over budget. and it didn't matter like how much, how many hours we'd throw at it. We'd just keep adding more and more and more, and we'd always go over budget. And it was almost always in the development time and the QA time. because the amount of things that we would find that need resolution, because everything was, you know, custom built for that site. So kind of after

Matt

You'd go over budget, you'd go over budget on your own, on your own hours that you, that you scoped out for the project.

Ross

Right,

Matt

You weren't taking it over budget for your client. You were just eating. You were eating that cost.

Ross

Yeah. Yeah, exactly. And not like, a little bit like there were times we'd be hundreds of hours over, and so we kind of had to say like, well, we need to do something about this, and. You know, spent some time kind of analyzing, you know, what is contributing to this. And part of it was, you know, reinventing the wheel all the time. And also, just not having the internal time and an agency to like really build our own product, so to speak.

Like we weren't gonna get into like the custom page builder space because that's so competitive that it just, you'd have to dedicate like your entire company to that. So that didn't make sense to like invest it in it to that level, to get it to a

Matt

own page builders. To make

Ross

Yeah, to make our own page builders essentially to the place where we wouldn't be losing money, you know, every time we built a site, like getting 'em to that level. And so, yeah, we started looking at other solutions and, you know, I did a few tests for it to see like, how long did it take me to build out, you know, a layout that we did, that we custom built using, you know, a various page builders.

And it was like 10% of the time, you know, like it would take me three hours compared to like 10, you know, for, for what we did custom.

Matt

And, and what was the pro like? What did custom look like? 'cause I think it's important that folks who are just living in have, we're in a whole new cohort, you and I,

Ross

Yeah,

Matt

or there's a whole new, there's a whole new cohort now. Like you and I are old. we've been doing this for a while and, and, and what we haven't. I think what the mistake that a lot of us have made that have been here for a while is there's like a whole new cohort of people who have, are building and delivering websites who consider, who are developers, consider themselves developers in the sense that you and I consider ourselves developers.

'cause we used to hand write code, in Notepad plus plus, way back in the day. but now there's a whole cohort that have come in because of like Elementor, right? And, and that, and, and that's how they've. Developed websites and they are developers. It's just like a different way of developing WordPress websites. and I'm saying all that because I think people are like, oh, I, I did it. We've been doing it custom. A lot of people think that they're doing it custom with Elementor, or page builder.

So what does custom look like? Where you were like, oh man, we're going 10, 20, a hundred hours over doing it our custom way. What, what did that look like?

Ross

Yeah, no, that's a very important distinction. because you can build completely custom websites using Elementor, any of these page builders, like, that's what's great about 'em is they don't really do a whole lot of restricting, of what you're building. You're not starting from something and trying to iterate on top of it. So what custom meant to us is, yeah, we had this like very bare bones theme, based on underscores.

So you install it and there's, you know, no colors, barely any typography, no layout, nothing. And then on top of that, we had kind of our own set of custom WordPress blocks, including like some extensions to some of the existing blocks. So like we, we'd have, we'd add certain settings to like the columns and, you know, group blocks, stuff like that. But, you know, essentially we're looking at a blank page and rather than, you know, configuring and building the front end of the site.

Through the admin, like you would with a page builder. We're writing everything custom, you know, like custom template files and HTML and custom CSS, to build all these layouts and in the front end. so almost everything was done in code, almost nothing, not almost nothing Over time, like more and more got to be done in the browser because we were using blocks. but a vast majority of it was actually writing code versus using a user interface.

And I don't think using a user interface means you're not a developer. I mean, it might not, it might mean you're not like a computer, like a software engineer. but I still think you're like, you're developing a website, you're building it.

Matt

Yeah. What did that mean? What did the custom side, what, what else was the expense of the, of the custom side? Was it, was it just writing the code custom every time the customer had the request, we realized, man, we're way over budget. With this internally, was it collaborating like a develop? Maybe you have a backend developer who starts developing a feature. Now that person goes off on vacation, somebody else has to hop in and, and pick up from where they left off.

And there was like, you know, overhead there of catching up with the project and, you know, understanding like where the code was. what other challenges did you face with custom coding, other than just the features that you were building, if any?

Ross

Yeah, certainly the more developers that we'd have on a single project, it would add a lot more hours. I. You know, we could potentially move faster 'cause people could be working on things concurrently. there's a lot more coordination that's needed. so typically we'd have like a lead developer who's kind of overseeing the project and then they would delegate components to the other developers. But that requires a lot of documentation and getting people up to speed and filling in context.

And then there's a lot of coordination to even discuss like, okay, I'm done with this, you're ready to merge it in. And then like code reviews and that sort of thing. So that certainly had a whole lot of time. Also, and this is still a challenge that we're gonna run into, but trying to. I'm trying to kind of not have what's called scope seep. So you know, if you're not familiar with it, scope creep is when the client is asking for features or additional work and you're not charging for 'em.

Scope seep is when you're introducing it yourself. And we had that, that issue quite a lot where, you know, we're all really passionate about what we do and we kind of be working on something and think like, ah, just be like that much better if we did like this, you know, additional, you know, little bit of work on it and that can really, It really snowballed really quickly. Like, you know, we're working on a custom login screen.

you know, there's so many components potentially associated with that. There's like the reset state, like, oh, what do the error messages look like, you know, What happens after you log in? What's the page you land on? So if you haven't scoped like this kind of full end-to-end journey of designing and building this custom login workflow, it's more just trying to skin the WordPress one. You can spend a lot more time there and it's great for the client.

and obviously you want to overdeliver, but you can sync a lot hours if you're not careful There.

Matt

Yeah. Yeah, for sure. I mean, yes, definitely have done that, certainly in the past. I'm wondering, I know this is kind of early on in, in, you know, what I'll call your experiment, but, I'm wondering if this opens up the custom side as an opportunity for the business. In other words, now that you've kind of like found some efficiencies with, Using an off the shelf solution, which is weird to say in WordPress in the year 2025. But

Ross

Yeah.

Matt

as you, you find, you find these efficiencies, with the off the shelf solution. I wonder if now you can also like go to the customer and say, Hey look, here's the price. and in this price we're using this air quotes framework. We're using this pre already made framework. We've done it before in the past, and these are the things that we can do with it.

But as soon as you try to like break that, either with scope creep or your like, cool new features that we can build for this, it has to be custom. And now custom is, you know, maybe where, where you were at before, but like 20%, 30% more, on the, on the line item because now you've realized, oh God, when we go this route, we're generally that 20 to 30% over. As we've been in the past, so I'm, I'm curious if you're gonna look at that as a new opportunity if you've not already started doing that.

Ross

Yeah. Yeah. That is exactly our expectation. I mean, the type of projects that we take on, usually there is some custom development that's needed, like from a backend logic perspective, like we're working on a project now, that needs like a very particular membership management, workflow that. Like WooCommerce memberships isn't a good fit. Some of the other ones that we're looking at, like, it just has to work exactly how they need it.

So that's something we're gonna build custom and most of our projects, there's something like that, but it, it's gonna be, yeah, that much more narrow window and. Because we are still thinking we're gonna do like a block based page builder. We do expect to have like custom blocks here and there. Like we'll still need to design something that doesn't fit in, like the off shelf, you know, block based page builders that are out there.

but you know, the real opportunity that we're, we're looking at as far as opening up for us is, being able to sell, more marketing services. So in like 2018, we became more of a, like a full service digital marketing agency, which was like really transformational for the agency. 'cause we're, we stopped chasing like the one big ticket projects and started chasing retainers. And as far as like scaling an agency, like predictable revenue is, you know, so important.

so because we can spend less upfront on the website, then we can pitch them on, okay, let's spend some additional money on getting the right people to your site, driving leads, driving conversions. I. And our experience is once you get people into a retainer, they really see the value. And even if they only plan on doing it for a year to see how it goes, like they tend to stick around.

Matt

I am curious if you think, this is a great, segue 'cause this is what I was gonna kind of lead into next, is, I'm wondering if you're seeing the front end of a project and not the, not the literal and the technical term, like, like front end versus back end, but like the front, front house of a, of accepting a project like scope it. Quote it, it's whatever, $20,000 and then it's, here's the three payment milestones.

Like, I'm wondering if you're seeing that kind of like go away because you're experiencing efficiencies, with tools around WordPress. Maybe the clients are starting to understand like maybe clients now in the year 2025 have gone through a few iterations of their website, so they kind of know what they're looking for now. Like they're not. Dragging you down with a bunch of like discovery and scope stuff anymore.

So I'm wondering if you're seeing a world where, I mean, it's gonna be a startup fee and then a monthly retainer to build websites for folks or build solutions for folks.

Ross

Yeah, you know, I'd, I'd like to see go in that direction.

and there was a, a period of time where we're, we're really trying to push this idea of, HubSpot actually came up with it, but like a launchpad website, meaning like the minimum amount of work you need to do to get a website up, like a, a new version of website off, like, you don't necessarily have to rebuild the whole thing and have it launched day one, but like, what's something better we can get up quickly and then you move into a retainer to iterate on it.

Just every month and kind of get it to where you want it to be. we as an agency struggle with that for that, the same reasons that the scope seep. Like we had a hard time of like moderating ourselves and not just delivering something that they're like, yeah, I'm good. I don't, we don't need to spend any more money on it. but I do think that's, that's a much better approach. you know, what we've been doing lately that's.

I, it kind of works to solve the, the same issue is discovery first projects where, you know, we're not trying to quote the entire project all at once because a lot of times you just guess wrong. Like, there's just not enough time. The typical sales process to get all the details right. so we're, we're kind of breaking off that first portion of, you know, the discovery, the strategy, and sometimes all the way through the design concepts. So we have a very clear picture of what we're building.

we'll do functional specifications and that sort of thing, if there's any custom logic that's needed. And then, then quote for the rest, which gives the client, typically a better solution. you don't have to pad the price as much, you don't have as much issues as running over. and that's been working really well for both us and our clients.

Matt

Yeah, it can't be, you know, understated enough that, the. Recurring revenue for an agency is critical for, you know, for sustainability of the business. Again, going back to my three Cs, like, you, you should be thinking about that. you know, again, not just from like, I mean it is, but so not just like how much money can we make, or like, what else can I sell this customer? But it, it is for, you know, that. I've always said agency life is one paycheck away from bankruptcy.

Somebody else had said that to me like, you know, years ago, you know, because depending on like how you've structured the agency, like if you don't have that, that runway, that's something that you know. December, right? Holiday season. Nobody's saying yes to a contract. No one's answering your emails. people all have time off. Like your own team wants time off, obviously. And it's like the worst month, like November, December, you're just like, you're operating at the halfway point.

This is how I was. And, and maybe I'm wrong and maybe that's why, I couldn't sustain, you know, the size team that I had. You know, you're halfway through the summer, you're like, okay, how are we, what are we projecting for holiday season? For that downtime of like no projects and, and no revenue in, you start selling for the next year.

So you start selling for, okay, as soon as we come back from holiday season, who's giving us, you know, the down payments on the new projects, you know, slated to go, you know, the next year. And, you know, that was a super stressful cycle. I'm sure it still is a stressful cycle for people and that's why that recurring revenue is. So important. And sometimes it can be like, ga gamified, I think is the, is is is a word that I, I might throw out there.

Like, everyone's like, you gotta get that recurring revenue. Buy my $97 a month course to tell you how to do it. And you're just like, okay, what am I doing? Like, but there's like a vital reason for it, you know? I dunno if that makes any sense or that was like a bit of a soapbox moment, but that's like, it's a tough thing to like un make people understand.

Ross

yeah. Absolutely. I, I think you're really gonna struggle. It's to scale your agency and have a team on payroll. if you're, if you don't have recurring revenue for all the reasons that you say, like you're just. You know, chasing the next big project, hope that it comes in and that you have enough. And if, if one of 'em doesn't work out, then you're in trouble.

and I mean, I, you should have, you know, some reserves, like, I think there's some estimates of like three to six months of runway and like a line of credit's a good idea. But those are all things you don't want to have to tap into. So really focusing on that reoccurring revenue, even if it means, you know, having a bit of a loss in the beginning to get them into that reoccurring, you know, retainer. I think that's worth it.

and I guess last thing I'll say on that is, you know, a lot of times when people, especially in the WordPress space talk about reoccurring revenue, they, they say like, oh, sell site care. And like, you know, maintenance and, and backups and updates, which like, I think is great, like start there.

But if you look at the prices of those, like maybe you might charge a couple hundred dollars and that's maybe on the high end, like how many clients do you have to get at that price point to hire like one person to manage it for you. It's a lot. So it need to be thinking about higher value services that clients are gonna pay and get ROI on every month.

Matt

that's a fantastic, yeah, that's a fantastic point. And I, and I think that's like what I was getting at is a lot of people will just be, will throw that around, right? And it's just like, oh, it's oh so easy. And it's like, yes, and, and, and yes, it is, you know, a good first step, but you should, you know, trust me

Ross

right.

Matt

as you're scaling it, you want to think, you know, bigger, Actually leads me to my next question, sort of in the back half of this conversation is like, how, how has finding customers changed, if at all? I assume referrals still top of the food chain for, for, for agency life as it is with like a lot of things in, in, in the real world referrals. But how have you adjusted to find new customers and like even reposition yourself?

Ross

Yeah. I mean, finding customer acquisition I think is always a challenge with an agency because there's just so many agencies out there, and I think it's, it's gotten harder over the years, like we did a whole lot of local business like. Outside of referrals. A lot of our business was local for a long time, basically up until Covid.

And then it seemed like once Covid hit and everyone went virtual, there was kind of this universal shift in thinking where it's like, we don't need to work local anymore because we're not even gonna meet you in person. And it seemed like that hasn't really changed much. You know, so for us, you know, we've been fortunate that our referral network is really strong. strategic partnerships have always been really huge for us.

So finding other agencies or services, that complement yours and referring work back and forth, that's a good way to get your foot in the door with a lot of work. and then just having a really strong network in general. Which might be easier or harder these days, but like the more people you know virtually or in person, the, the more likely they are to know somebody who needs help.

And so we've gotten a ton of work just sustained based on people I've met like 10 years ago, 15 years ago, that are still connected with me on LinkedIn. And they see me post now and again. So they have a project come up and they think of us. the other way you can go about it in, in talking to other agency owners is really just focus on. a lot of outbound sales, like, you know, we're more waiting for clients to reach out and come to us.

You know, we do some proactive marketing, but, you know, we're not doing cold outreach. We're not doing a lot of, trying to connect with people and discuss their issues. It's more like waiting for people to raise their hands. but if that's not working, I think you really have to start hustling and getting in contact with people and asking for referrals and all that. Mm-hmm.

Matt

Yeah, I think, and we'll transition to talking about AI now, but I think that, you know, ev there's obviously many schools have thought of this. It's like, it's gonna put us out of business, you know, everyone's gonna gonna do it. It's launch their own websites, things like that. I'm trying to look at it as a way to. To find efficiencies first and foremost. because, you know, you can't, you can barely predict it out one year, let alone five years. So very difficult to, to make those adjustments.

you know, in your own business today, based on like a one year to five year predict prediction with ai. But what I know now is like there are some efficiencies to be had. Are you leveraging those efficiencies in the business? Most importantly, have you heard from your clients at all saying, Hey, can we incorporate ai or, here's what I'm doing with ai. If at all in in your business.

Ross

Yeah, we're definitely incorporating it in our business. for efficiencies, like you said, like where we just started using a code editor that has ai, built into it. certainly all the marketing activities that we do, we'll do a lot of AI to help speed that up like research and. Idea generation, that sort of thing. and, and yeah, I think a good number of our clients use AI also.

I mean, we typically work with marketing departments, so like, our client is like a marketing manager or a marketing leader, and they're pretty clued into AI as well. So they're using it kind of in similar ways that we are. You know, as far as, you know, where we are now, where we might go, like the way I see it in the next maybe year or so is, like you said, there's a lot of efficiencies to be gained.

basically the people who figure out how to, how to leverage AI the best, are gonna benefit the most from it. Like, I don't see it replacing anybody quite yet. where it goes long term, I'm not exactly sure. 'cause like in theory, it's gonna get to a point where it can. Build design, write all the copy a website for you, you know, pretty much do everything. But if it's doing that for everybody, then what, what makes the difference between website A and B and that's, that's not exactly Sure.

how that shakes out. It seems like there still would need to be some humans in there working with it to make sure that it's, it's different.

Matt

Yeah, I think, this is just my prediction, but like I know at least in what I'll call my, my side hustle, the here at the WP Minute and just like thinking as like a. Content publisher, somebody who's never done any, like, I've never done any content for SEO. Like there's never been an SEO strategy. I've never been like, you know how I'll get more readers to my website into my newsletter. I will write 17 most popular, you know, slider plugins for WordPress.

And listen, I say that also understanding that I have friends who have made a lot of money doing that kind of thing. but as a publisher in this day and age, like. You can't have, you can't just have a podcast. You can't just have a YouTube channel anymore. You have to have, it has to be omnichannel, it has to be, social, it has to be a podcast. It has to be YouTube, it has to be the newsletter. It has to be the blog, it has to be community around that. And it has to be like events.

It's like seven things now I think in order to survive. and I think like on the agency side, when you start to like democratize a lot of this stuff. Say like, oh, now I can just do this with AI and it'll solve this pain point for me. The agency owner has to think of like, how can I bring as much human into this solution as possible? And that's not even just, I think in the, like the short term, it might just be like, how do I relate with this customer, more human?

And how do I do like more white glove approach for this customer? But like, do you also live in your customer's world like. You might have to get, not, not you specifically, but agency owners might have to get much more, vertical with like, where do you, where do the events that your customers go to, how can you live and consume that life as much as they do in order for you to be able to sell them a website now or get them to like sell a contract?

I mean, you could argue that you kind of have to do that today ish, but you almost have to be like an, like an influencer in their space just to get. Just to get the job in the future, to stand out from, you know, the row of people who are just doing this stuff, just like with AI and pumping it all out.

Ross

Right.

Matt

that's a crazy prediction, but, you know, it could be the unscalable thing is what's gonna work

Ross

Yeah.

Matt

in the, in the long run. I.

Ross

Yeah, I can certainly see that. I mean, like right now we're doing, we do a lot of work and we've worked with 'em for a long time. A company that does protein mass spectrometry, I think is how you pronounce it, which, like I have a very high level understanding of what it is. It's like analyzing proteins for research. But I couldn't tell you much beyond that. And right now it works. It's fine. You know, like we can do enough where we can, you know, help them grow their business.

But I could see a place in the future where they're only gonna want to talk to somebody who really understands that deeply, attends the same events, you know, knows how to talk to scientists the same way, that sort of thing. so I could certainly see it, it going in that direction.

Matt

Yeah. coding with ai, yes or no? Something that you're trusting, not trusting, experimenting with. Where do you land on that?

Ross

Yeah, we're, we're actively experimenting. I mean, certainly there's some small, things we've had pretty much just written by ai. I mean, obviously you have to do testing and, and it's in my experience at, at this point, like you have to know. Coding, like what you're coding into a certain point. Even just to get it to produce like the code that works.

like I was having it write some JavaScript for like a HubSpot landing page and you know it, even having it write that JavaScript I. Took a fair amount of work in telling it what wasn't working and what to look at and like those details. So I don't think it's quite there yet. But again, it's like, it's a force multiplier. Like the places we are using it, it's speeding things up quite a bit and it seems like the quality of the code is only getting better.

Matt

Yeah.

Ross

And like you can think about the future. I mean, this is what kind of, what excites me about it is like the AI at some point. If it doesn't already, we will know and understand every single line of code that's in something like WordPress. So its ability to write the most efficient code is gonna far surpass anything that we can do.

Matt

Yeah. The, yes. I, I, I agree that, that we're gonna get to, to that point. I have a little bit of doubt. On how efficient we think it's going to be based on like the pace that we've seen improvement. Like I think we went from like, I don't know. And listen, I'm not a, some kind of like AI absolutist or some, you know, somebody who pretends to have like cover the space deeply. but certainly have been like really pushing myself into it for the last six to eight months.

Like the rapid de de development from like Chachi Petite version one. To where we are today. Like it went pretty fast. Like one to two was like mind blowing. Two to three was mind blowing. Three to four was, it was mind blowing, but maybe just not as much. And now it's starting like to shrink, it's the iPhone effect, right? iPhone ten, eleven, twelve, thirteen, fourteen, fifteen. You're like, you're looking at like iterative improvements, you know, year after year.

And if you're just looking at it in a yearly thing, you're like, eh, not much changed. But if you looked at it in like a four year window, you're like, wow. There was like. A big gap of, of improvements. Because I'll tell you, man, I've been building, just as an aside, I've been building a lot of things with ai, but I've been messing around with building my own podcast player, you know, web-based podcast player. And, it will just destroy code in the matter of seconds.

Like I'm, I'm using Cursor the other day and like it gets to this point of complexity, and maybe this is where now I have to be a better like cursor developer. Which is weird, like you have to be like a better cursor slash prompter to improve in these areas. If you don't know, like the code, where you almost start thinking, maybe I should just learn the code, man,

Ross

Right.

Matt

May, maybe I should just learn the code and, I wouldn't have to do what I'm doing over here. But, you know, I won't bore you with like the complexities. But, in order to access, the podcast, the Apple Podcast, API for core's policies, you must. Have these on, I'm using CloudFlare workers, right? To make the API API request sanitize the API request and send it back to the React app. Okay.

Ross

Mm-hmm.

Matt

And you'll just be like, like something won't work. And I will say, like, I just had this the other day where suddenly like thumbnails weren't loading for like, cores, errors. CORS for those of you have never heard of that before. And so I'm like, Hey, we gotta debug this. the images aren't loading. And, so I says, okay, I'm gonna go in, I'm gonna debug this in your CloudFlare worker. And if you're, if you've used cursor before, it'll show you.

The lines of code is changing per request as it's like going through as the AI agent is going through. And all of a sudden I see my CloudFlare worker file say minus 600, right? Which is minus 600 lines of code, right? And then it says like, and then it says plus two. And I was like, whoa, whoa. I have to like hit the stop button and be like, and then like literally prompt it and say. What are you doing to the worker file? You have removed everything from the worker file. You cannot do that.

I need you to debug just the images, and then it just comes back and it says, oh yeah, you're right. I, I was just testing it for like, literally like it says, oh yeah, you're right. I was just testing it for the images. let's add the code back. And it's just like, what the hell were you doing? In what world was it right to remove all of that functionality in the. In just to get this image thing right, just figure out the image thing. Don't destroy everything else.

which I guess, you know, there are ways to do this in Cursor that says like, don't make any like impactful changes, but then what does that do? Does it add like a ton of overhead to your code that you don't know about? So it's a long rant of saying like, yeah, these things are pretty cool. I can make some pretty cool things really quickly, but then a lot of this stuff breaks down, once you get to a certain size of AI project.

Ross

Yeah, I mean that's been my exact experience as well, like, and that's why I was saying it. You still kind of have to know what it's doing to point it in the right direction and give it the right prompts. Because I've experienced the exact same thing. Like one small thing isn't working, I tell 'em it's not working and it completely changes everything and breaks like three other things.

I'm like, no, no, no, no. Like here's the issue and the more descriptive I can be about the issue and kind of point it in the right direction, the more effective it is. but yeah, using it right now to completely build an app without some technical knowledge of the programming language and what needs to be done, I think would. It, you're really gonna struggle. I don't know how effective that's gonna be.

Matt

Yeah. One last thing about the AI stuff and we'll, we'll, wrap up this conversation about starting and surviving in an agency world and why would you do it? ha has a, I was talking to an agency owner the other day, a really well known agency owner, and he was, look, and, you know, he made a remark and said, I could replace my entire marketing team with some of the stuff that AI is doing.

Today, true or false, do you think you can just replace a whole marketing team and at least for marketing a WordPress agency, do you see any, efficiencies or anything to be gained by leveraging AI to help us, get found for our clients?

Ross

Yeah. Well, I, I, I'm skeptical that you could. Remove an entire team at this stage and still produce quality content. I think we're, we're still at a point with like a lot of the content or like what's being put out from AI where it's, it's pretty noticeable. like I can really tell if something's wr been written by chat GBT unless it's been like rewritten. but certainly I could see it pre preventing you from having to hire people like.

You could probably get more done with fewer people at, at least from my experience. I mean, I could be completely wrong. They, they might have found some better way to use it than me. but from my experience, yeah, I, I think it, it's a good, again, a force multiplier, like you can get a lot more done. I. And kind of touching on one of the things you were talking about earlier about like how many channels you have to really be engaged in these days.

I think that's a really good use case for AI and marketing. I forget who coined the term, but somebody said that SEO is no longer search engine optimization. It's search everything everywhere. Optimization. Like you kind of need to be at work 'cause people are looking for information everywhere. And I think that's one of the places that AI is really, really effective. Like you can create one original piece of content with the assistance of ai.

Like as long as it's not creating it, you know, completely for you. And then it's really good about turning that into other pieces of content. like if you haven't seen the, the recent, SOAR enhancements from OpenAI. I mean, its ability to create like an infographic is incredible. So like, just feeding it like a prompt based on your content and it producing infographic that you can put on, you know, social is, a really good use case for it.

Matt

Yeah, yeah. Ross Johnson, thanks for hanging out today. where can folks go to say thanks? Where can they find you on the web?

Ross

again, I think just, our website's a good spot. 3.7 designs do co. I'm not on X or blue sky these days, as much, but you can find me at LinkedIn. Happy to connect with any other WordPress professionals. Just search for Ross Johnson and find the, the one Ross Johnson that works for 3.7 designs.

Matt

if you wanna find other WordPress professionals, join the WP Minute Slack. You know, you can do it for as little as five bucks. join the WP Minute slack, the wp minute.com/support. Join other WordPress professionals. They're help support. The show. And if you wanna be a sustaining member, $79 a year, you get access to membership events kicking off in April. With our, April webinars, headed this week, April 3rd, we'll have, customer support does not have to suck. I agree.

That'll be a webinar for members only. and then we will have other webinars scheduled throughout the year, the wp minute.com/support. Thanks for watching. Thanks for listening. We'll see you in the next episode.

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