TBC: LocalVox Has One of the Highest Digital Retention Rates
September 23, 2014 | Contributed by: Greg Sterling
Earlier today TBC Holdings, parent of The Berry Company, announced it had acquired LocalVox. The purchase price wasn’t disclosed. However LocalVox had raised roughly $10 million through a combination of venture funding and debt financing.
The company began life just over four years ago as NearSay, a local business and events calendar. The site still exists; though in 2011 the company brand became LocalVox.
LocalVox over time built out a suite of “content marketing” tools for SMBs or for resellers, such as The Berry Company. Currently LocalVox serves multi-location brands, franchises and individual SMBs. TBC has worked with LocalVox for almost two years and decided to buy the company based on its experience with the product and the team.
That’s according to Laura Cole, VP of Marketing for The Berry Company. She told me this morning that the LocalVox product suite shows some of the highest customer retention rates of any of the digital marketing products or offerings the company sells to its SMB customers. That’s no small thing in a world where most digital solutions for SMBs still see more than 75% or 80% churn annually.
LocalVox describes itself as a content marketing platform like Hubspot but it offers a broader array of services, including listings syndication, reputation monitoring, deals, mobile, email marketing and SEO, which is driven by content publishing.
Beyond the LocalVox retention rates Cole cited the service element of the company’s offering as very attractive. There’s a social media “do-it-for-me” product that starts at $1,000 per month but tiers as low as $199 per month that still come with service. The company’s cheapest package is $99 per month.
Of LocalVox’s 70 employees roughly 20 are dedicated to servicing SMBs, says LocalVox CEO Trevor Sumner. Sumner prefers to say that these service offerings are “do-it-with-me” rather than “do-it-for-me.” He says that business owners tend to get involved and take on self-service once they see results from these social efforts.
Sumner also stressed the company’s onboarding process, which all customers experience. He remarked, “The first 60 days [for a new customer] are crucial.”
LocalVox has a number of partnerships and third-party relationships (e.g., First Data) that Laura Cole says will continue. She says however that The Berry Company’s sales force, capital and other resources will enable LocalVox to scale well beyond what has been accomplished to date.
In response to my characterization of LocalVox as a near “soup to nuts” marketing tool, Sumner said that the integration of all these capabilities is critical for performance and to demonstrate ROI to business owners — one of the more challenging things to do in an increasingly jaded and skeptical SMB market.
Accordingly I asked Cole and Sumner about the noise in the market and the challenges of differentiation. They agreed these were problems but again pointed to LocalVox’s retention rates and service capabilities.
In closing I asked Sumner if there was anything over the past four years of running the company that surprised him. He said that the big eye opener is “how complex the ecosystem is and what it really takes to scale.” He added, “We learned a lot from selling directly but it’s better to work with partners that can bring scale.”
Certainly the acquisition solves that problem.