What does the Data Say about Churn?

Kristin CoitHead of Partner Acceleration

Google AdWords Channel Partnerships

Accelerating Growth through Acquisitions,

Upsell, and Retention

GOALS:● Share how Google views churn

● Give you 1-2 ideas to consider

● Invite you to work with Google

Setting the Stage: Growth Decomposition Ad

Rev

enue

Acquisition

UpsellChurn

Previous Revenue

Current Revenue

Path to growth made up of three primary elements: Acquisitions, Upsell, and Retention.

Google defines churn as an AdWords account that has been

inactive for 6 consecutive months.

A lapsed account is considered an account that has been inactive for 1 month.

How does Google define churn?

Two similar partners; different growth composition

Acquisition Upsell ChurnAcquisition Upsell Churn

Acquisition Focus

Upsell + Retention Focus

Partner A Partner B

Impact of Churn on Growth Churn is a detractor of growth; aim to retain existing base.

The probability of selling to an existing customer is 60 – 70%. The probability of selling to a

new prospect is 5-20%. – Marketing Metrics

Not all “churn” is true churn

Controllable Churn

termination because of sale, relocation, reorganization, seasonal, or permanent closure of the business

termination because of dissatisfaction, price-value feedback,

or competing products

From a previous Churn study of select partners:52% of Google defined churn is addressable by partner

Main reasons for controllable churnSingle biggest driver of churn is a function of expectations, perceived value.

Relationship between reporting quality and churn rate

Source: Internal Google study, U.S.

Communicating ROI

In two separate churn studies, U.S. and

APAC, reporting was identified as key to

delivering satisfaction and meeting

expectations for clients.

Customers who receive weekly or monthly reports are more likely to be satisfied with their reporting

% rating reporting as Excellent or Very Good

Q24 What type of reporting did you see? Q26a How would you rate the reporting from [PARTNER] on your Google Advertising?

54% 48% 14%

Weekly Monthly Less often

Frequency of reporting

Best Practices:

● Diligently track customer contracts and pro-actively contact customers in advance of their contract expiration or renewal (consider contract auto-renewals).

● Contract length: month-to-month v. 6-12 mo.

26% were not asked to renew or extend their campaign

“No response from them therefore we did

not renew”

“I wanted to renew the contract but I couldn’t

contact the sales rep to put in more money”“They didn’t inform me

about renewing”

How can you win accounts back?

There are opportunities to recover lost business!

From a previous Churn study of select partners:

58% indicated they would resume if...

58% indicated they would resume if they...

● saw results or better explanation of the results

● received additional/different pricing options: consider offering a winback incentive, consider offering them a month free where the account is optimized

● received more/better customer support: code for churn reasons, or survey post cancellation to deep dive into history

Service Best Practices

● Develop processes to handle downgrades, cancellations, and discounts of product.

● Retention team to retain high probability churn customers, survey your customers regularly. Keep your finger on the pulse.

● Provide ad hoc rewards to long standing customers. The little things do matter.

How Google helps partners support retentionPredictive Churn Program: Receive Monthly “Accounts at Risk” list, plus custom Churn Symptoms Report.

Tenure Analysis: Analysis on advertiser tenure, status of last month, and historical performance.

Churn History Analysis: Historical view of partner churn against peer set benchmark.

Customer Satisfaction Survey: Facilitate CSAT surveys to capture feedback from advertisers and identify areas of improvement.

THANK YOU.Kristin Coit

kcoit@google.comHead of Partner Acceleration

Google AdWords Channel Partnerships