Recently, a major Canadian telecommunications giant announced it will start charging a CAN$2 monthly fee to its Internet service customers who opt to receive paper bills instead of electronic.

The telecom company is one of a growing number of firms, such as banks and utility providers, that are adding extra service fees for those people who still want a paper bill.

Whether you agree or disagree with the decision, there’s no denying the fact that sending customers an invoice through the mail is an expensive option compared to electronic and credit card billing.

However, cost aside, the reality is that new print newspaper subscribers who select paper billing tend to discontinue their subscriptions earlier than those who choose electronic billing (credit card or auto-debit).

That’s why newspapers should be doing all they can to encourage customers to choose electronic billing.

So what can you do to increase your “EZ Pay” new subscription acquisitions?

Here are a few direct marketing campaigns you should include in your A/B testing to encourage new subscribers to select credit card payment:

First, offer an incentive to customers for paying by credit card. This sounds easy, but I’ve seen many samples of subscription-based, direct marketing campaigns that either do not offer an incentive or offer the same type of incentive over and over again, such as gift cards.

At the Toronto Star, we have conducted numerous A/B tests around incentives, and I find that offering an extended discount term or additional discount percentage for paying by credit card works well.

For example, if your standard introductory offer term is three months, then offer customers who pay by credit card the discount for four months. Or, if your standard introductory discount is 30%, then offer a 40% discount to customers who pay by credit card.

Try out different terms and discount rates to see which one consumers respond to best.

The Star recently tested a campaign through direct mail that offered subscribers an extra six months on a promotional rate if they agreed to pay by credit card. The promotion resulted in 86% of the new starts selecting credit card payment. Our average credit card acquisition without an incentive is 60%.

These are just two incentive examples. There are many other low-cost incentives you can test, including gift cards, bundling opt-in products for free or a reduced rate, and extending service days.

Test, monitor, and test some more. These campaigns are ineffective if you don’t create solid test and control cells to track results. They are also pointless if you don’t monitor the retention to determine the true value of the increased EZ Pay acquisition accounts.

Did the credit card customers retain longer than the invoice customers? How much longer? Long enough to make the extended discount term worthwhile? These are all questions you should answer through your retention analysis.

The benefits are really EZ to tally — paper and postage cost-savings, increased retention, and lower bad debt are all great reasons to focus on increasing your EZ pay acquisition for 2013.

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