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Value Added Ep.11 – White Labeling Pros and Cons

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10 Aug 2020

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This week’s episode on the pros and cons of white labeling picks up where Ep.02 left off.

Jonathan and Jarod have extensive experience on both sides of the white label coin — both as vendors and as customers.

As revealed in Ep.02, both Jonathan and Jarod now prefer vendor partnerships over white labeling because they agree it’s ultimately more profitable…

But many people have asked:

  • Why does white labeling often not work, and how can you do it better?
  • If you do choose to white label — how can you maximize profits without jeopardizing client relationships?
  • What mistakes do agencies make when white labeling other vendor’s products?

The answers to all that and more in this episode of the Value Added Podcast!

KEY TAKEAWAYS

  • The biggest downside of white labeling is customer retention. In Jarod’s experience, clients who receive white labeled services tend to churn after 3-6 months.
  • Agency owners or salespeople trying to resell white-labeled services to clients often have very little clue about the service itself. This lack of understanding leads them to misrepresent or oversell the results a client can expect, leading to churn.
  • If you choose to white label, educate yourself and your clients about what to expect in terms of results.
  • Having knowledgeable salespeople that can accurately answer prospect’s questions and set realistic expectations will drastically improve your sales and retention.

“If a salesperson or vendor fails to educate a client about what an algorithm update is, its possible effects, and the likelihood of it occurring, what do you think a client’s reaction will be when they see their site drop from #3 to #8 in rankings during a campaign?

They’re unlikely to be understanding or happy and are very likely to churn.” Jarod Spiewak

“When you’re white labeling a service, you start off prospecting for leads.Then you’re the salesperson, and it’s your job to frame whatever you’re buying or selling on to clients as the best possible product.

Once you’ve made the sale, what a lot of people don’t realize is that you become the accounts person, the customer service representative, the project manager, the person that tucks the kids in at night.

Many think that once the sale is done, it’s their time to sit back, relax and cash the checks, right? And that’s wrong. If you want any kind of retention, you need to be the client’s advocate with your vendor.” Jonathan Kiekbusch

  • Jonathan and Jarod agree that communication is the key to not just white labeling but customer retention as a whole.

“Client retention is 80% customer happiness and 20% results.” Jarod Spiewak

  • Looking for a business opportunity? Jonathan outlines a white label model that could earn the right person “a boatload of money!”
  • Don’t charge a ridiculous margin on services you white label!

“The ideal way to white label is to sit in the golden middle.

Advocate for your client, advocate for your vendors and communicate effectively to them both.”Jonathan Kiekbusch

Subscribe to the Value Added Podcast — featuring SEOButler founder Jonathan Kiekbusch and Blue Dog Media head honcho Jarod Spiewak — to be notified about future Live Streams and Podcasts.

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