This session was presented at the LSA19 event in Dana Point, California, February 25-27, 2019.

1. |
The Science Behind
Increasing Customer
Retention

2. |
Speakers
3
Brendan King
CEO and Co-Founder
Lex ten Veen
EVP Partnerships
Neil Crist
VP Products

3. |
Why churn is a bigger
problem than ever
4https://www.livechatinc.com/blog/churn-rate/
Customer Churn

4. |https://hbr.org/2014/10/the-value-of-keeping-the-right-customers, https://www.entrepreneur.com/article/227946
Gartner: a 5% increase in retention can increase
your profits by 25% – 125%.
Harvard Business Review: acquiring a new customer
can be 5x – 25x more expensive than retaining an
existing one.
5

5. |
The exponential benefits of rentention
What makes clients churn and burn?
You focused on deliverables, but not results
You lost key relationship staff
You over-promised
You under-delivered
You didn’t communicate well
You didn’t showcase your achievements
Your services were not robust
You lacked important knowledge
You were too tactical
You didn’t show the ROI
Partner side
Turnover on the client side has caused lost
relationships
They had unrealistic expectations
They don’t know what you do
They did not let you optimize the solution
They had a weak market
They had unstable finances
They shot down your ideas
They were thinking short term
They don’t see your value
They don’t have the time for marketing
Client side
6

6. | 7
How do we keep customers?
2 Perspectives
Fundamental
research
Data backed
insights
By By

7. |
Neil Crist
VP Products
8

8. | 9

9. |
Methodology
Moz surveyed 1400+ local marketers and ask them 30 questions about their work
in the industry. Responses where analyzed individually, by marketer type (agency
vs. in-house), by company size, and as a whole. The respondents represent a
broad range of local marketers across industries, marketing job tiles, and role level
10

10. | 11
Local search is a broad field that’s constantly growing and changing,
challenging marketers to keep up. No matter what kind of company they
work for, today’s marketers need both the big picture — relating to
customers in the real world — as well as little details like questions
submitted on a Google Knowledge Panel.
1. Local search marketers must be
versatile to succeed

11. | 12
Today’s marketers need more than great tactics; they need to learn to be
great communicators. Getting clients on board with strategies is difficult
when they don’t fully understand the goals and metrics, and teaching them
is getting harder as the SERPs become more complex.
2. Clients don’t
understand local search

12. |
With a lack of serious competition for Google
and an increasing presence of paid results,
local search marketers are broadening the
scope of their work. SERPs will always be
important, but marketers are now also focusing
on alternative platforms like email, word-of-
mouth, and real-world community building. With
all local businesses focused intently on Google,
the ability to see other marketing opportunities
can make companies stand out.
3. Local marketing is about
more than just search
13

13. |
Top strategies are all over the map, lacking clear best
practices
14
In a field where versatility is key to success, we see a
remarkable spread of priorities for local marketers.
Some tactics that are hyped, like in-store tech, have
very few proponents, but even the #1 priority — on-site
optimization — gets less than 20% of the votes. This
paints a picture of an industry that marketers are still
trying to understand, probing different strategies as
they figure out what works.

14. |
62.2% of clicks
Organic
90%
SEM
10%
SEO
2.8% of clicks
Google AdWords
35%
don’t click
Spend Clicks
15

15. |
Clicks
57.1%
don’t click
40.9% of clicks
Organic - SEO
2% of clicks
Google AdWords - SEM
16

16. |
Organic
drives
more clicks
than paid20x
Clicks on Paid Results
Clicks on Organic Results
17

17. |
thinkwithgoogle.com/infographics/mobile-search-trends-consumers-to-stores.html
Local is the new front door
7.6 Billion
local searches in U.S. every month
…that ensures overall
marketing effectiveness
76% of people who search on their
smartphones for something nearby
visit a business within one day
28% of those searches for something
nearby result in a purchase
PAID MARKETING INVESTMENT
SALES
$
SEO
Why is local crucial?
Local is a strategic investment
in your Bottom of Funnel…
18
$$

18. |
A QSR pizza chain was launching online ordering and new
locations with
aggressive revenue goals.
Moz took over this pizza chain’s local listings management
and within six months the client was so satisfied with the
results that they increased the number of local listings
managed by Moz by 92%.
92%
With Moz Local, they reached
63% more pizza buyers.
Their listings accuracy
improved by 36%.
36% Listing accuracy improvement
Increase in local listings
managed by Moz
63% More pizza buyers reached
19
Moz helps Pizza Chain
Achieve Explosive Growth

19. | 24
Brendan King
CEO and Co-Founder

20. Increasing SMB Retention
Data-Backed Insights to Help Fuel Growth
25

21. 26
SMB retention is increased by:
1. Selling more products & services per SMB
2. Bundling traditional with new products
3. Increasing SMB engagement
4. Providing DIFM marketing services
5. Providing specialized products & services
for particular SMB verticals
6. Providing proof-of-performance
reporting to SMBs
Our Thesis

22. 200K
SMBs
3
Years
27

23. 28
Data Sample
Channel Partners
Partners that currently have a billing relationship with Vendasta
SMBs (Small & Medium-Sized Business)
Only those who have purchased 1+ paid product or service
Definition
Retention
An SMB who continuously pays for 1+ product or service

24. Experiment #1
Product Sales
& SMB Retention
29

25. Does the quantity of products an SMB purchases
from a single channel partner affect retention?
30

26. What do we mean by products?
31

27. Total Products Purchased
Account Retention Rate
32
31%
39%
55%

28. Total Products Purchased
Account Retention Rate
33
35%
43%
72%

29. Total Products Purchased
Account Retention Rate
34
37%
49%
73%

30. Total Products Purchased
Account Retention Rate
55%
35
70%
92%

31. Total Products Purchased
Account Retention Rate
12 Months 24 Months 35 Months
1 Product 55% 39% 30%
2 Products 72% 44% 35%
3 Products 73% 49% 37%
4+ Products 92% 70% 55%
36

32. Insight & Recommendations
Solve multiple customer problems.
Be the expert. Instant access. Go-to-market. Broad selection. Tools to sell.
37

33. Align Products With SMB Needs
Advertising Listings Reputation Social Marketing Website / In Store CRM / Loyalty
Do they know
about you?
Do they
trust you?
Will they
convert?
Will they
remain loyal?
Can they
find you?
Do they
advocate you?
38

34. Experiment #2
Product Bundling
& SMB Retention
39

35. Product Bundling Works
Account Retention Rate
Channel partners who bundled
their own offering with a
Vendasta product or service
saw an overall
49%increased retention SMB rate.
61%
81%
93%
41%
60%
75%
Jan 1, 2016 Dec 31, 2018
40

36. Insight & Recommendations
Bundle new products with existing offerings
to increase SMB retention.
41

37. Experiment #3
User Engagement
& SMB Retention
42

38. Do highly engaged SMB users
stay with channel partners longer?
43

39. Engagement Frequency
Account Retention Rate
31%
39%
66%
Jan 1, 2016 Dec 31, 2018
44

40. Engagement Frequency
Account Retention Rate
31%
41%
72%
Jan 1, 2016 Dec 31, 2018
45

41. Engagement Frequency
Account Retention Rate
37%
55%
80%
Jan 1, 2016 Dec 31, 2018
46

42. Engagement Frequency
Account Retention Rate
78%
88%
95%
Jan 1, 2016 Dec 31, 2018
47

43. Engagement Frequency
Account Retention Rate
12 Months 24 Months 36 Months
Rarely Engages 66% 39% 31%
Engages Once Per Month 72% 41% 31%
Engages Once Per Week 80% 55% 37%
Engages Once Per Day 95% 88% 78%
151%
Increase in retention
rate over 3 years when
SMBs are engaged
48

44. Insight & Recommendations
Provide actionable insights & SMB
tools to prompt engagement.
49

45. Experiment #4
DIFM Services
& SMB Retention
50

46. Do SMBs who receive marketing services (DIFM)
stay with channel partners longer?
51

47. What do we mean by DIFM services?
● Social Media Posting
● Website Building & Maintenance
● Review Response
● Managed Advertising
● Online Listing Correction
● SEO Keywords
● Blog Posting
52

48. Total Marketing Services Fulfilled
Account Retention Rate
39%
42%
61%
Jun 1, 2016 Dec 31, 2018
53

49. Account Retention Rate
40%
46%
71%
Jun 1, 2016 Dec 31, 2018
Total Marketing Services Fulfilled
54

50. Account Retention Rate
55%
69%
87%
Jun 1, 2016 Dec 31, 2018
Total Marketing Services Fulfilled
55

51. Account Retention Rate
72%72%
92%
Jun 1, 2016 Dec 31, 2018
Total Marketing Services Fulfilled
56

52. 12 Months 24 Months 36 Months
0 Services 61% 42% 39%
1 Service 71% 46% 40%
2 Services 87% 69% 55%
3+ Services 92% 72% 72%
Account Retention Rate
SMBs with 3+ marketing services fulfilled
had a
80%increased retention rate over 3 years.
Total Marketing Services Fulfilled
57

53. Insight & Recommendations
Provide DIFM marketing services and make it a key
part of your customer success strategy.
Build relationships. Become the trusted advisor.
58

54. Experiment #5
Vertical Specialization
& SMB Retention
59

55. Do channel partners who focus on
specific verticals see an increase in SMB retention?
60

56. Vertical vs. Horizontal Channel Partners
Account Retention Rate
Jan 1, 2016
39%
52%
67%
29%
38%
60%
34%
Increase in retention rate
after 3 years for channel
partners who specialize in
specific verticals
Dec 31, 2018
61

57. 70%
55%
39%
20%
150%
Increase in retention rate
after 3 years for SMBs within
a channel partner’s key
vertical.
Vertical Partner Selling Outside Vertical
Account Retention Rate
Jan 1, 2016 Dec 31, 2018
62

58. Insight & Recommendations
Focus on key verticals to deeply understand the
SMB’s needs and offer relevant solutions.
Find a niche and dominate.
63

59. Which SMB verticals have the highest retention?
64

60. Bottom 5 Verticals
Account Retention Rate
After 3 years, the following
verticals saw the lowest SMB
retention rate:
● Beauty
● Event Services
● Shopping
● Finance
● Restaurants
Jan 1, 2016 Dec 31, 2018
36 Months
Beauty 18%
Event Services 14%
Shopping 20%
Finance 20%
Restaurants 18%
65

61. Top 5 Verticals
Account Retention Rate
Jan 1, 2016 Dec 31, 2018
After 3 years, the following
verticals saw the highest SMB
retention rate:
● Education
● Auto
● Health
● Hotels
● Professional Services36 Months
Education 35%
Auto 30%
Health 32%
Hotel 39%
Pro. Services 43%
66

62. Top & Bottom Taxonomy Averages
Account Retention Rate
Taking an average of the best
and worst industries, we see
that the best industries have a
100%increased retention rate after
3 years.
65%
46%
51%
37%
28%
18%
Jan 1, 2016 Dec 31, 2018
67

63. Insight & Recommendations
Choose your vertical carefully.
Consider both market size, retention rate, and competition.
68

64. Experiment #6
Proof-of-Performance
& SMB Retention
69

65. Do SMBs who receive proof-of-performance
reporting stay with channel partners longer?
70

66. SMBs who were sent a proof of
performance report for at least
half of their lifetime had a
38%increased retention rate
after 3 years.
Proof-of-Performance Frequency
Account Retention Rate
Jan 1, 2016 Dec 31, 2018
80%
64%
52%
36%
40%
29%
71

67. “Google My Business” Authentication
Account Retention Rate
Getting SMBs set up with Google
My Business and authenticating
their GMB in the Vendasta
platform showed a
51%increased retention rate
after 2 years.
78%
56%
59%
39%
Jan 1, 2017 Dec 31, 2018
72

68. Google My Business in Executive Report
73

69. Google My Business in Executive Report
Account Retention Rate
Dec 1, 2017 Dec 31, 2018
90%
73%
86%
58%
SMBs who received a report with
their GMB insights for at least half
of their lifetime saw a
47%increased retention rate after 1
year compared to those who
received a report without GMB
insights.
74

70. Insight & Recommendations
Provide proof-of-performance
& associate your brand with Google.
Authenticate Google My Business & include in your reporting.
75

71. |
Questions?

72. Title
uberall.com
email
Name
phone
Our offices
Berlin
Hussitenstraße 32-33
13355 Berlin
Germany
Paris
54 rue de Londres
75008 Paris
France
Cape Town
128 Saint Georges Str
Simon's Town 7995
South Africa
London
1 St Katharine’s Way
London E1W 1UN
UK
San Francisco
600 California St
San Francisco, CA 94108
USA
Amsterdam
Weteringschans 109
1017SB Amsterdam
The Netherlands
Brendan King
CEO and Co-Founder
bking@vendasta.com
Lex ten Veen
EVP Partnerships
lex@uberall.com
Neil Crist
VP Partnerships
neilc@moz.com