Hi Jeff,

I decided not to wait for Vendasta to do that. We do it on monthly on our own. We pay the $50 and charge the client a monthly amount so we don't have to have that silly conversation about why they have to pay us up front for listing distribution. While it incurs a small amount of risk, we have never been bitten by it. We also charge a support and training fee so in the event that a client were to cancel in the first few months, we still don't lose money. It's worth the risk for us.

Thanks for opening the discussion.

Doug

I don't think I see any risk (so we agree). It is that overall it is really just about managing Cost of Goods Sold. When Listing Sync Pro went to Monthly this eliminated any real risk and enabled us to reduce the cost of getting started for our clients. For every 10 accounts that renew after 12 months there is a $500 spoke that month is Cost (we bill like you do). Billing annually for that one services just seems dated and not in line with the current time.

I agree with both of you. What I do is offer a setup fee to offset the upfront cost and potential of them leaving the program before the year is up.

Sending data to aggregators on a monthly basis is not effective. Moreover, data aggregators gather this data periodically and share with high-traffic local listing sources. These data takes time to propagate over local & high traffic listing sources that is why offering the product on a monthly basis is less effective for your customers.

Listing Distribution submits on a weekly basis. I don't think there is any issue with the way LD works we are talking about how it is billed.

Hello

As soon as you enter your business information, we push it to the data aggregators. It can take 6-8 weeks for them to receive the information and ensure it is correct in their own databases. It is then up to the sites and sources to update their information from the data aggregators. They each query them at various intervals—some seek out the information weekly, monthly, etc. Therefore, the timeline for when a source picks up that information will vary greatly depending on their process for updating their data. This is why offering the product monthly may have less impact for a customer. I hope this clarifies why it is more efficient to bill yearly for it.

A one year subscription spread out over 12 months is the exact same subscription that is billed every 12 months. This thread was not at all about how the solution works but rather how it's billed. No one is looking for LD to be a monthly solution for clients.

I would like to hear from Vendasta on this from a billing perspective.

Hello Jeff,

I guess the point that I didn't pass across fully to you is that from a customer and also a data submission perspective it is not effective doing this monthly. Also, this impacts how the product can be billed. We can have more detailed discussion if you are interested in the particulars.

I guess that I failed to get my point across that this was more about accounting. A 12 month subscription (regardless of how it is billed) works exactly the same. There is absolutely no difference in how the solution works if it is billed monthly.

I'll give you an example. Listing Sync Pro used to billed ONLY annually and now it has a monthly option. It works exactly the same as before. You see this is about accounting. Nothing is different in how the solution works. But.... averaging Cost Of Goods Sold in a monthly subscription changes. It also reduces the cost of startup passed to the client and eliminats the need for one off annual billing in our accounting systems. The idea is to make package pricing consistent month to month.

You are very correct about nothing changing in how the solution works for Listing Sync Pro (LSP). Also, in terms of monthly COGs, startup cost and accounting having monthly packages would be great. However, one must keep in mind for LSP, the data is published almost instantly for businesses while for Listing Distribution (LD) the data takes time to propagate. In the later case as soon as the data is submitted data aggregators would usually charge the full amount for submitting, cleansing, verifying and propagating this business location upfront. In the listing ecosystem to provide value to a customer using LD a monthly subscription for a location would be less effective in this use case. Think about it from a customer that pays in the first month and data is submit to aggregators and still in verification state, there will be no benefit for this customer once subscription is cancelled in month2 and also, the full cost at this stage will already be charged by aggregators with no way to recover this cost from a cancelled subscription.

Based on this response Your agency could still charge annually and have no risk. My agency could charge monthly and assume the risk of a customer cancelling (I am not worried about this). There really is no other point to how the LD technology works. This is purely about how we license and bill. The option would be yours to choose so we can both win in the end. A 12 month subscription is a still a 12 month subscription regardless of how it is billed.

Vendasta has moved to insta-billing (this improves cash flow and growth tracking). I am surprised this has not already happen. Consistent revenues/COS and growth makes running an agency much easier IMO.