On WordPress Development Retainers

With over 40 people working at DevriX right now, we have revised our service solutions and focused on promoting a type of service that combines our recurring revenue goal with iterative development solutions for some of our clients.

While we do provide maintenance services, we realized that a development retainer would be incredibly useful for most of our leads. This month we’ve started a new WordPress development retainer and signed a discovery session for another large one coming next month. There are a few more in our pipeline which our sales rep is looking into, sharing our process with our prospects and getting some valuable feedback for our plans.

WordPress Retainers in Numbers (Stats)

We are approaching our fourth year since I coined the “WordPress retainers” term. Our first two retainer accounts are still with us!

Here are some retainer statistics compiled at DevriX (Dec 2018):

  • Our average retainer contract is 20 months. Considering when we’ve started and onboarding new customers, this is projected to grow to approximately 3 years.
  • 93% of our revenue is supplemented by retainers. We don’t just “offer” retainers; our marketing team often says we are the WordPress retainers company.
  • The average retainer revenue is $85,000. Earlier retainers have accumulated more although some of our recent clients spend 5 figures a month.
  • We have scaled from about 12 to 42 people since we switched to a recurring revenue service model.
  • Retainers have improved the quality of our work over time. Long-term contracts allow us to invest in tooling, ongoing performance and security improvements, and R&D for clients in certain industries.
  • Our impact is amplified after the first few months. The first 2 is when we prove ourselves and align communication. Once we study the business model deeply, our team proactively suggests business, marketing, and automation solutions that deliver ROI.

Since our WordPress Development retainers are something that we now recommend every time a fixed budget proposal is on the table, here are the main reasons why we stick to this model.

Estimating Development Work

dilbert-estimates

Estimating WordPress development services is often a tedious task that is not profitable for one of the parties, if not for both at the same time. I wrote about estimates and what are the main challenges quoting projects, and the truth is that estimates always go out of order – be it budget, time frame, or something else. Let’s compare that to development retainers.

Customers try to get quotes on their project specifications and compare different companies based on budgets and delivery dates. I’ve always found that to be a comparison between apples and cucumbers.

Mario Peshev

Unlike selling products (such as cars), custom development services are not equal. There are thousands of different ways to build a solution. Low-cost ones could involve a cheap premium theme and several plugins, resembling the required features – with various compromises on quality, speed, security and attention to detail. High-end ones focus on details, with hundreds of thousands of lines of custom code, and weeks (or even months) spent on optimizing the platform for speed, security, or user experience.

And this is barely scratching the surface.

The Challenges With Scope Definition and Estimates

Scoping a project requires a certain level of spirituality. Or being able to travel in time – in future, in various dimensions, assessing the different possible outcomes with time, based on their quality.

Most people are still unable to transcend through time and space, therefore they compare on cash and time.

Fixed-fee projects are based on assumptions. Even if you spend an entire week or two discussing details, you won’t be able to cover every single bit of your project. I’ve seen specifications over the years defining each data type, its fields, even the field limitations in a programming language or a database column constraints.

And yet, that’s usually not what a customer needs at the end.

Back when we offered fixed-fee solutions, we charged for discovery sessions aiming to explore the business model and key traits which make a project successful. The end goal was still a ballpark — which incentivized clients to skip essential bits of the original specification and try to align them during the actual development phase.

Miscommunication and Frustration

Sometimes miscommunication is inevitable.
Sometimes miscommunication is inevitable.

Clear communication is paramount for every successful project. Miscommunication is the main reason for failed businesses, personal relationships, friendships — and even car accidents on the road. People assume some general rules that everyone obeys and agrees with, and everything else should start from there.

And it’s normal. When communicating with people, we expect them to demonstrate common sense. This includes the established moral values within a family, how to behave in public, general appreciation of life, respect to elders, helping people with disabilities on the street, mutual respect to other people, basic philanthropy urges and so on. Certain regions may have other cultural commonalities – sharing religious beliefs or political views, commitment to the local sports team etc.

Deviating from the common base of values is perceived in different nuances – from odd through strange up to outrageous. Which is why people tend to join communities, or “packs” with their friends, since there tends to be less pressure, fewer unexpected surprises and… well, things work way better when everyone is on the same page.

Common Sense in Business

Unlike other fields in life, business is dynamic. You meet new people all the time, reach out to clients around the world, partner up with freelancers or hire new personnel. There is not enough time to get to know each other well enough, and ensure that both parties are a good fit and share the same business values that would bring the project to life in the best possible manner.

Which is why people have to rely on their own understanding of life, label various qualities into groups, and assume. A lot. And since business hides infinite opportunities and challenges, it’s impossible for one to know it all, and people have grown to be successful using different strategies.

And often that’s the reason why business relationships fail. CEOs get fired, employees get frustrated by their managers, business partners part ways due to lack of common values, and the majority of the waterfall projects fail.

And waterfall projects take time. Releasing a major project takes years — and I’ve seen it firsthand back as a Java engineer working on enterprise projects. 

WordPress retainers can be structured in an agile manner, starting with a Minimum Viable Product (MVP) and iterating on a monthly basis. Or applying fixes and additional bells and whistles quickly, skipping all the tedious paperwork.

WordPress Business Expectations

Communication for the win.
Communication for the win.

There is no one to blame here. People have different expectations and varying experience.

For example, if I estimate a WordPress development project for $40K and my prospect expected a $5K quote, that doesn’t necessarily make any of us wrong. A professional development project can easily cost $30K to $100K or more. 

And an inexperienced client will likely start with low-quality development work or a bundled site resulting in a $1,500 – $2,000 “lego” projects. Just search for development fees out there and you’ll immediately stumble upon Upwork, Fiverr, and outsourcing agencies selling generic templates.

The average client is not acquainted with our industry and the difference between developing a custom platform and buying a pile of plugins, nor can they make a difference. A custom project may be an overkill in the first place – when building something for a business that doesn’t get any traction whatsoever (think 500 visits per month) or a personal/pet project.

Value Costs Money

Recently I had several conversations with businesses that contacted us for development services. I kept hearing repetitively the word “value“. Providing value, bringing value, delivering value.

Their budgets were nowhere near what we charge for, and they either looked for something custom that would cost us 8-10 times more than their budget or something “patched” and “quickly bundled together with a premium theme and plugins“.

Either way, this is not something that we offer. This violates our entire business model of “quality” and “real value” as we operate with a completely different set of definitions for that same term.

And there are probably hundreds of thousands of non-technical people able to build the “lego”, and even a DIY customer can drag and drop these as long as they are aware of operating with FTP. You don’t have to be a developer to set up a quick build for a friend… Unless you plan to scale it and make a real business case.

WordPress Development Experts

Speaking of terms, I blogged about WordPress talent shortage and also discussed in details the fact that the WordPress industry is just like the others. Same goes for misusing development titles and their righteous definitions as seen in every single programming platform, language, framework, library, whatever out there.

I usually review 20-30 job applications for WordPress people every month. We train new people for some of our clients, or manage new support staff for their applications, or simply grow our own team.

Out of 25 jobs applications on average, approximately 20 are from people who rate themselves 4 out of 5 on PHP development skills and 4/5 or 5/5 on WordPress development. 18 out of those 20 have either never written code at all in their entire life, or have slightly modified WordPress page templates for their clients.

The “senior backend developers” that often reach out to us have a portfolio of about 10 sites running Avada, Divi or another random theme, with no custom code. Best case scenario – a custom theme.

Developers for Everything

Experts Everywhere

I digress, but it is a complicated matter that cannot be judged lightly. As someone working on high-end technical projects and coming from the enterprise world, I have switched technologies, vendors, frameworks, and occasionally find myself building test applications with a random framework out there over the weekend, studying the paradigms of a new language on the go.

I know what the “developer” term means and I truly believe that the aforementioned services by freelancers can’t be further from the skill. I decided to take it a step further and did a quick “Wix” search on Upwork, and there we go – “WiX developer” and “Wix Pro Guru” in the first 10 results. At least the Squarespace search didn’t list any “developers”, just “professionals” which is less misleading.

I act as a WordPress and business advisor for numerous clients. I’m fully aware of the state of the WordPress ecosystem, and I am passionate about helping new WordPress developers starting with a solid base and know-how in all of the relevant fields required for day-to-day development work. This is why I’ve written hundreds of Quora answers on software engineering, learning to code, building production-grade systems, and acquiring the right skills to become a professional software developer.

Retainers For New Customers

We have a number of awesome clients looking for high-quality development services. But we receive tons of requests from small business owners looking for theme installations or minor modifications.

I wrote about blogging for helping customers that are not aware of the cost of labor. Regardless, more and more prospects contact us and want complete redesigns, building intranets, large membership websites or social networks for hundreds of dollars, despite of our minimum budget requirements and hourly rates available on our website.

In order to reduce the communication overhead, avoid ongoing frustrations or misaligned expectations, we have implemented the following 2 models:

  1. $10K minimum project cost (regular gigs are normally in the $30K – $80K range with some $100K+)
  2. If the budget is unknown or the scope is unclear, we start with a development retainer — which is usually the case

Internally, we handle most of our work the Agile way, regardless of the individual approach. If we land a waterfall-driven project, I make sure that the requirements are well defined in our backlog as we break them into weekly iterations. The only difference there is that we have spare resources (both in time and manpower) that we could involve into a project in case of a challenging integration or another bottleneck that we stumble upon while building the web solution.

Pushing For Development Retainers

Retainers have even been the preferred way for building web development applications by some of our customers. In addition to solving our own problems (avoiding scope creep, planning with approximation when it comes to unknown APIs or services and booking a ballpark of hours on a monthly basis), we do address several important issues raised by our product managers during discovery calls. For example:

  1. Design is built iteratively – we work closely with the client until they’re fully satisfied.
  2. We plan for an MVP to be used by beta testers or early adopters whenever we built the key features.
  3. We start with some plugins or a lightweight theme first in order to test the model before rebuilding some of those from scratch.
  4. Budget is not set in stone, which means that the client decides what’s worth reiterating or building further and which features are ready to use.
  5. The server setup is scalable. We can start with a low-cost package and upgrade it gradually as the traffic and user base grows.
  6. We can afford to offer marketing and business strategy consulting along the way if that would benefit our account.

The long-term nature of the contracts help us to focus on areas our clients can benefit from — or even innovations we can invest in and apply across our portfolio of customers.

Retainers Revolve Around Innovation and R&D

A good amount of our work we haven’t done before — integrating proprietary APIs, connecting different company services to a new platform, or working together with our clients‘ employees on UX, marketing, sales struggles.

Since each company is unique and we don’t want to limit our interactions, a retainer based on hours is a great fit for both parties. Customers requiring fewer calls or reviews will get more work done in a shorter time frame. Or we could spend extra time on R&D and meetings when needed. Some of our clients require an outstanding design while others focus on the feature set.

A WordPress retainer helps with satisfying everyone, regardless of their communication and management style or preferences. We don’t place artificial constraints and don’t overbudget for features that are not essential to a project.

Agile is the preferred way to go by many successful startups – even may of the Unicorn brands. So why not implement it in your WordPress workflow as well?

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