What is a digitised services revenue model and why do you need one?
Author: Leanne Knowles
- First published: September 2020
- Article updated: August 2024
- 3-4 minute read
How to digitise your services business and unlock recurring revenue
In the new tech era, the rules have changed — and so must your revenue model.
For small and medium-sized service businesses, the days of relying purely on in-person delivery and “hope-and-hustle” sales are over. The businesses that are thriving have found a new gear — turning traditional services into digitised, scalable offers that produce consistent, predictable income.
This isn’t just about moving online for the sake of it. It’s about creating a digitised services revenue model that frees you from lumpy cashflow, reduces your reliance on constant new client acquisition, and sets you up for long-term, sustainable profitability.
Let’s break down what that means, why it matters, and how you can make it happen.
What is a digitised services revenue model?
A digitised services revenue model takes a traditional service that was previously delivered face-to-face and repackages it into a digital format. This can:
- Add value to the traditional service (e.g., resources, automation, or personalised support)
- Replace the traditional service entirely with a digital alternative
- Create an additional delivery option that offers customers more flexibility
Done well, it opens up opportunities for reliable, consistent recurring revenue — something service businesses have historically struggled to achieve.
Why this matters more than ever
Most service businesses know the pain of lumpy cashflow. One month is booming, the next is dry. This feast-or-famine cycle can make it impossible to plan for growth or invest confidently.
A digitised services model changes that by:
- Creating predictable, repeatable income streams
- Increasing the value and lifetime spend of each customer
- Reducing churn by building ongoing relationships
- Making your business more resilient to market shocks
It also makes you more attractive to investors and buyers, who increasingly see recurring revenue as a non-negotiable for valuation.
And here’s the kicker — going digital isn’t just about your bottom line. It’s about delivering a more consistent, high-quality customer experience that differentiates you in a competitive market.
The shift: from traditional to digitised services revenue models
Let’s compare the two approaches side-by-side.
Traditional services model – focus on customer acquisition
- Linear, transactional delivery: sell → deliver → repeat
- Revenue depends heavily on finding new customers
- Inflexible, labour-intensive, inconsistent cashflow
- Customer retention takes a back seat to lead generation
- Higher tolerance for churn, with limited upselling or cross-selling
Digitised services model – focus on customer retention
- Dynamic, differentiated, and experiential delivery
- Retention comes first, with strategies to maximise Customer Lifetime Value (CLV)
- Predictable service delivery, often more cost-effective
- Built for scalability using automation and digital tools
- Revenue streams designed to grow with each client relationship
Businesses already making this shift are pulling ahead. Those still clinging to the old model risk being left behind — and the longer you wait, the harder it becomes to catch up.
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Examples of digitised services revenue models
Digitised services are everywhere — from global giants to niche specialists — and the models they use can be adapted to almost any small or medium-sized business.
Here are some proven examples:
- Managed Services – Network Overdrive, Sugarshot
- Software as a Service (SaaS) – Salesforce, Dropbox, ClickFunnels
- Affiliate selling of SaaS – Independent consultants and marketers monetising referrals
- Content subscriptions – Australian Financial Review, The Point Magazine
- Memberships – Rental Rookie, Keto Connect
- Online training – Aviator Training, TrainingBeta
- Evergreen online courses – Headswitch
- Digital contracted services – Telstra, AT&T
- Digital advertising – Google, Facebook
The takeaway? These aren’t just tech company strategies. They’re accessible, adaptable models for service businesses of every size and industry.
How to digitise your service business
Your goal is to add value to your customer’s experience, differentiate your offer, and create new streams of revenue. Whether you can fully digitise your core service or not, there are ways to incorporate digital elements that enhance delivery and create recurring income.
For service businesses:
- Package your knowledge into on-demand courses or training videos
- Turn consulting into group programs with digital support tools
- Add memberships for ongoing access to resources and community
- For product-based businesses:
- Bundle services (like setup or consulting) with your products
- Offer paid digital support, tutorials, or premium onboarding
- Create hybrid models combining physical and digital delivery
Digital value-add ideas to increase recurring revenue
Here’s a menu of options to inspire your own digitised offers:
- Digital information products – checklists, templates, toolkits
- ‘How To’ videos – step-by-step guides customers can access anytime
- ‘Ask Me Anything’ sessions – live or recorded Q&A for members
- Online courses – structured learning paths
- Virtual mentoring – scheduled Zoom sessions
- Accountability calls – to keep clients progressing towards goals
- Virtual memberships – exclusive resources, community, and support
- Automated email nurture – delivering value and upsells over time
- Virtual events – webinars, summits, or online workshops
- Research reports & whitepapers – premium content for niche audiences
The benefits of recurring revenue for service businesses
Once you digitise your services, you open the door to recurring revenue — and with it, a new level of stability and scalability.
Benefits include:
- Consistent cashflow – predictable income you can plan around
- Better resource allocation – less firefighting, more strategic focus
- Improved customer experience – more consistent delivery and engagement
- Higher business valuation – recurring revenue is a major asset for buyers
- Scalability – digital delivery removes many physical constraints
Without recurring revenue, you remain stuck with the stress and unpredictability of starting from zero each month.
5 steps to create your own digitised services revenue model
If you’re ready to future-proof your service business, here’s the roadmap:
1. Review opportunities inside your business
- Identify skills, processes, or knowledge you can deliver digitally
- Look for customer frustrations you’re not currently solving
- Consider services you could bundle into a subscription model
2. Create an irresistible offer
- Package your service in a way that makes the competition irrelevant
- Focus on measurable outcomes your clients want
- Use pricing models that reward loyalty and long-term commitment
3. Adapt your systems
- Upgrade billing and subscription capabilities
- Ensure your delivery platforms are scalable and user-friendly
- Build in automated customer communications
4. Automate marketing and sales
- Use email sequences, social media scheduling, and CRM tools
- Focus on building a lead pipeline that converts into long-term customers
- Track performance so you can refine and improve
- 5. Ramp up onboarding and retention
- Welcome customers with automated videos and resources
- Keep engagement high with ongoing touch points
- Measure retention and actively work to improve it
The bottom line
The post-Covid services economy rewards businesses that think beyond the next sale. By moving to a digitised services revenue model, you not only protect yourself from unpredictable cashflow — you position your business for sustainable, scalable growth.
You don’t need to overhaul everything overnight. Start with one digital revenue stream, test it, refine it, and expand from there. The sooner you start, the sooner you’ll enjoy the freedom, stability, and profitability that comes with a future-proofed business model.
My Recurring Revenue Checklist
In the meantime, here’s My Recurring Revenue Checklist that I have used in my own business to help me build out my digital services strategy. It’s yours for free and it’s an easy download, so just click on the link below and you’re on your way to the next step.
About Leanne Knowles
Leanne Knowles is a former professional skydiver turned Business Growth Strategist, who started two successful businesses in the adventure sport industry at 24 years old and sold them both ten years later. Leanne founded Headswitch as a marketing consultancy in January 2000, and now helps business owners in service and creative business to grow and scale their business using smart, simple strategies, the latest tech tools, and productive business relationships.
