How to reduce digital subscriber churn by addressing payment failures

By Grzegorz Piechota

INMA

Oxford, United Kingdom

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Extending a digital subscription grace period and card retry cycle can help news media companies reduce passive churn.

On average, every third digital subscriber lost by news publishers did not want to cancel. “Reducing system churn is a huge opportunity,” said Elaine Scott of Telegraph Media Group in the United Kingdom. 

Scott, who leads subscriber engagement and retention at the Telegraph, was a speaker at the recent INMA Master Class on Digital Subscriber Retention. Before joining the Telegraph, she worked on retention at UK’s largest video streaming and paid broadcasting companies, Now TV and Sky.

She used the term “system churn” to describe what others call “involuntary churn” or “passive churn.” Per Piano benchmarks, 35% of all news subscription churn is passive.

“Over half of your subscribers may not even realise there are issues [with payment] and do not want to cancel,” said Scott, referring to the results of the surveys of her newspaper churned subscribers. 

The reasons for the payment failures may range from subscribers forgetting to update card details, to lost or stolen cards, bank rejections, network errors, or subscribers exceeding credit limit. 

The company managed to reduce this type of churn significantly, by 10 percentage points, from January to May. “The first step to fight churn is to understand the make-up of your churn,” Scott advised. 

Here’s her step-by-step guide to reduce passive churn:

  • Building granular reporting, down to the level of credit card provider, was paramount to find the root of the problem. Credit card issues were the most frequent reason of passive churn at the Telegraph.
  • The newspaper reviewed subscriber journey and identified areas of opportunity to engage readers both before the potential system cancellation and afterwards, through on-site campaigns, e-mails and, contact centre calls.
  • Scott encouraged her peers at her master class also to use automated card updater tools.
  • The Telegraph also extended its grace period, or the time of the service after the due date, from four to 28 days, and reviewed its card retry cycle to try charging the card more times.
  • In a quick poll of the master class participants, INMA saw that almost half, or 44% of publishers, set the grace period at 14 days or fewer that might be too short to successfully save the subscriber.

Rethink your passive churn approach with insights from the Telegraph Media Group and other retention masters:  Buy a ticket to the INMA Master Class on Digital Subscriber Retention, watch all recordings, download presentations and additional reading materials.

Banner image courtesy of Steve Buissinne from Pixabay.  

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