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Get engaged not dumped

However brilliant the strategy and execution of your renewal series, customers will not renew unless they have engaged with your publication over the previous twelve months. Fostering engagement is therefore the key to achieving high renewal rates, writes Julian Thorne.

By Julian Thorne

All subscriptions marketers know that high customer retention rates are the secret to healthy customer life time values and happy finance directors – or at least marginally less grumpy ones.

Unfortunately, the tools subscription marketers have available to them to influence retention rates, and bring joy to the finance department, are limited. The data insight is usually restricted to how much the subscriber paid for their last contract, how they paid, how long they have been a subscriber for and how they were originally recruited. The subsequent actions concentrate on renewal communications, how many and through which channel, and price positioning.

All this is very worthy, and effective at the margins, but if the product is poor, the retention rate will be poor as well, no matter how brilliantly crafted the creative is for renewal letter three in that highly evolved twelve step retention plan. Retention rates are nothing more than a measure of customer loyalty. They are not an end in themselves. Customer loyalty itself is a measure of positive customer engagement. It is, after all, impossible to be truly loyal to a product or service if you fail to engage with it.

Any experienced subscription marketer will stifle a yawn when asked to conduct yet another lapsed reader / user survey by a panicky publisher or digital development team to find out ‘what is going wrong’. The answers are nearly always the same with only the relative ratios varying – lack of time to read, too expensive, reading a rival product, poor service, doesn’t work, no longer interested in subject matter and so on. However, behind the prosaic reasons is a glaring truth. The lapsed reader or user has become disengaged with the product or, to be blunt, is bored by the product.

Publishers and content creators don’t like to hear this which is why they don’t ask the question. They would prefer to blame a recession or the ‘market’ or people’s busy lives or how unfair it is that the rival publication has twice the marketing budget. Unsurprisingly, falling retention rates in publishing companies lead to emotive meetings and a desperate search for any data to throw light on the problem. Focus groups are commissioned, editors grilled, postal dockets for renewal letters forensically examined and in the end, someone gets fired and a redesigned product eventually emerges.

Lack of insight

Why? The simple reason is that many (not all) publishing companies still live in a world where they have no idea how their individual customers consume their products and why individual customers become disengaged from their products until it is too late. In the case of a print retail sale or an iTunes app download, the customer remains nearly always an anonymous ‘walk in’. For print subscription sales, the publisher has no idea if Mrs Jones rips her magazine from the hands of the posty as he walks up the garden path or if it goes straight into the recycling box. The same does not and should not be true for digital products. In fact, the main problem is either there is too much user and engagement data for companies to fully comprehend or the data collection tools just don’t work as promised.

What can publishers learn from other providers of digital services unencumbered by a legacy culture unfamiliar with placing customer data at its heart?


Scout Analytics, a company that provides analytical tools for subscription based companies across many sectors, recently analysed its clients’ customer user data to reveal links between usage, loyalty and subsequent subscriber retention.

Presenting the research, Matt Shanahan of Scout stated: “… based on our analysis across many different subscription companies, we’ve found that if an individual user doesn’t become loyal within ninety days of provisioning, there’s typically only a ten percent chance that they ever will.

Our analysis tracked cohorts of subscription renewals for an entire year, where the loyal users during the subscription term were classified by the number of days it took to become loyal users. In fact, the first thirty days produced the highest volume of loyal users, followed by the next thirty and then the next thirty.”

False economies

As Shanahan admits, this is ‘common sense’; after all why do candidates dress up for job interviews where they hope to be ‘engaged’ in future employment? Because first impressions count and always have done. And yet for most publishers, the point at which a customer order has been received is the point at which a relentless focus on cost reduction kicks in. Some publishers don’t even have the courtesy to send a welcome letter acknowledging receipt of a subscription order (“let’s save on postage”) and then take six weeks to send the first issue (“let’s make sure we keep our Presstream discount”). Others provide a digital subscription product which requires the patience of a saint to download and the technical ability of a thirteen year old to use.

For those publishers who actively concentrate on engaging positively with their customers and making a great first impression, the rewards come back multiplied many times over in improved retention rates. According to the latest Subscriber Service Survey results from Dovetail, those subscribers who strongly agreed that the wait for their first print issue to arrive was ‘acceptable’ had a renewal intention of 83% compared to just 51% for those who strongly disagreed. In that context, making a new subscriber wait for six weeks for their first issue in order to keep postal costs down is the very definition of an artificial cost saving.

Building an emotional connection

In designing customer welcome programs, great care must be taken to ensure that the program promotes true customer engagement rather than degenerating into a check box exercise to artificially mirror a favourable data profile. It is easy to assume from looking at user data that because high retaining customers might, for example, provide an email address that if you run a competition to acquire more email addresses your retention rates will go up. However, there is likely to be a big difference in customer engagement levels between customers who provide an email address unprompted because they really want to hear from you and those doing so because they might win a holiday.

The rapidly growing private social network and photo sharing site, 23snaps, was keen to increase initial engagement with its audience still further after measuring the strong correlation between early usage of the site and retention. As a result, a simple sign up wizard was built to help first time users access the site’s many benefits quickly and easily. The early test results were good with users uploading photos and inviting contacts to join exactly as the sign up process had asked them to. In fact, the data usage profiles of those who had used the new wizard looked comparable to past high retaining users acquired before the wizard was introduced. 23snaps anticipated that their already high retention levels would improve still further. It didn’t happen. Why not? Meaghan Fitzgerald, head of marketing at 23snaps, speculated that: “By removing the opportunity for people to explore for themselves, we reduced the opportunity to build an emotional connection with our service and retention suffered.”

So, although the data user profiles looked great the emotional connection was not as deep and retention was not as good. It would appear that true customer engagement requires a strong emotional connection as well as a rational one.

Get them to an event

Earlier this year, Mike Darcey CEO of News UK revealed to TheMediaBriefing the power of live events to create such customer engagement: “We find that for people who become a subscriber, if they engage with a Times+ event in the first year, they are one fifth as likely to churn (stop subscribing) as someone who is not. That's very, very significant. It's probably the most important thing we can do, with somebody who is a new subscriber.”

Darcey’s statement provides a strong clue to publishers looking to increase customer engagement but struggling to know where to start due to a lack of user data particularly around print products. Creating multiple opportunities for customers to engage with a brand and, most importantly, measuring the usage and impact on retention is crucial. It is no longer acceptable or advisable to sell a print subscription on direct debit and then deliberately never speak to the customer ever again for fear they might realise they actually are a customer and cancel. Publishers must be confident in their proposition and actively engage their customers whether through a loyalty scheme such as Times+, simple email newsletters, discounted e-commerce offers or print and digital content bundles.

The opportunities are now there to increase retention by increasing customer engagement and the strong financial upside of high retention rates provides a convincing business case for doing so.

Engagement scores

Ken Macpherson, director of data at The Telegraph Media Group (TMG), created an engagement score for every customer across the entire TMG single customer view database based on their interaction with the Telegraph brand. “We discovered that our top customers had done everything they could possibly do with us. They had been on holiday with us, brought their trousers and shoes from us, drunk our wine and subscribed to the paper for many many years.” Macpherson quickly spotted that those customers with high engagements scores also had high retention rates for the Telegraph’s subscription products. “Our challenge now is to carefully nurture our customers up the engagement score and only present subscription acquisition messages when our customers are ready to receive them as well as setting subscription renewal pricing taking into account our customers’ other activity with us.”

Macpherson has the tools and expertise to analyse customer behaviours, value and engagement across numerous different products and services under the umbrella Telegraph brand. For many publishers, this understanding remains frustratingly out of reach as they struggle to reinvent themselves as customer data driven businesses.

As Mathias Döpfner, CEO of Axel Springer wrote in his thought provoking open letter to Google in April this year, “If fossil fuels were the fuels of the 20th century, then those of the 21st century are surely data and user profiles.” To extend the analogy a bit further, user engagement data may well prove to be rocket fuel for 21st century publishers.