Most news media professionals with “audience” in their job titles face the challenge of allocating limited resources where they will generate the greatest return on investment.
Sometimes it comes down to a choice between using resources to retain existing subscribers or acquire new subscribers.
What is the best choice? I must admit, I feel strongly both ways.
Most marketers will tell you it is easier and less expensive to retain a current customer than acquire a new customer. They will also tell you that an exclusive focus on customer acquisition – without a plan to reinforce value and nurture a relationship – is a recipe for short-term success and long-term failure.
Here’s what we’ve learned:
- Fill the holes in your bucket before priming the acquisition pump. If you are shedding subscribers like a calico cat in July, you need to identify the issues within your control that are driving customers away.
It starts with timely delivery, accurate billing, and responsive customer service at a minimum. These are the “basic requirements” for subscriber retention and must be in place before investing in other retention efforts, e.g. subscriber rewards programmes.
Rewarding subscribers for enduring inconsistent delivery, sloppy billing, and poor customer service will not impact your long-term retention efforts.
- The role of customer service in retaining current customers cannot be minimised. Being responsive to customer needs is a minimum requirement for the success of any business.
Customer service only impacts subscriber retention when it is not only responsive, but also proactive. That is why establishing a multi-channel “touch-point” programme for current subscribers is essential for improving your long-term retention efforts.
This includes welcoming new subscribers and verifying delivery to proactive renewal efforts with timed multi-channel (phone, postal mail, e-mail) message delivery.
The goal should be to lead with the least expensive channel first to maximise the return on your retention investment.
- Providing customers with the opportunity to communicate service issues is essential. Customers that are provided the opportunity to share their displeasure with their service is less likely to share their negative experience with others.
But it goes beyond just providing an opportunity to vent. Customer service must also provide a timely response and resolution to customer service issues.
- Starting or converting office pay subscribers to automatic renewal programmes has the greatest impact on long-term retention.
Subscribers on automated renewal (e.g. EZ Pay) programmes retain longer, lower re-marketing costs and increase subscriber net present value. But auto-pay programmes alone won’t deliver improved retention results if the other “basic requirements” are not in place.
With improved retention – and lower re-marketing (win back) costs – you’ll be able to free up more resources for the acquisition of new subscribers. And those subscriber acquisition efforts will generate more long-term revenue when improved retention efforts are in place.