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subscription marketers


Conversion rate optimization (CRO) was originally defined as the art and science of increasing your website’s propensity to turn visitors into customers.

However, the expansion of the subscription model into our daily lives has now stretched that definition to include customer retention and reduction of churn rate.

So many of us use pay monthly or yearly subscriptions to services such as Netflix and Amazon Prime. Boy, do I love Amazon Prime.

But you can also have subscriptions to The Times, Spotify, Office 365, Dropbox, Norton security. Then there are businesses like Disney that have launched subscription children’s channels, Starbucks’ Reserve Coffee subscription, Graze snack box delivery – there’s even a razor/shaving club.

Why are subscriptions so popular?

Well, the revenue is measured by the lifetime value of a customer, not just the initial transaction value that a customer has made. It is recurring revenue; the gift that keeps on giving, if you will.

The lifetime value balances the heavy costs of acquisition and in the long term generates a very solid profit margin. So subscriber retention has become a ‘keep at all costs’ game – don’t lose my subscribers.

That’s why we use the same CRO consumer behavior acquisition methodologies in retention in order to play with consumer psychology to make the subscriber believe that cancelling his/her subscription is simply the wrong choice. Our conversion goal in retention is to make you doubt.

Here lies one of the many frustrations with CRO; most companies believe that increasing conversion is about site design, UX, price or constant giveaways and discounts. For both acquisition and retention, they are wrong on every level.

You see, the key is figuring out how to match the right psychological trigger to a particular subscriber.

Subscription types

Let’s look at news subscriptions like the Wall Street Journal or Financial Times, for example. Some of the techniques I would research could include loss aversion (Daniel Kahneman), where a person values what he has more than what he stands to gain.

Or Robert Cialdini’s principles of pre-suasion – getting a person to accept an idea before it is presented to them. All I need to do is get you to hesitate, just for a split second in that specific moment in time so you believe that cancelling your subscription is the wrong thing to do.

It’s fascinating to see how in this digital world of ours, marketers are obsessed with the technology silver bullet, the algorithm,

Or let’s say you’ve had a Norton antivirus security subscription for three years and your computer has been running without a virus all this time. You wonder whether that subscription is worth it and want to save the £39 annual cost – you want to cancel.

The most unsophisticated retention approach is to simply hide the cancel your subscription link or force you to call a phone number.

But you could design a conversational path or an in-app push conversation that reminds and educates the subscriber of the constant protection Norton provides: “Hi John, our Antivirus just scanned your phone, you’re safe and we will keep protecting you in the background”.

So the second you think of cancelling your subscription, we just need to surface the risk of being unsafe without us. Is your safety worth it? No. So I postpone my decision to cancel.

Influencing people’s decisions

There are so many different ways to influence a person’s decisions and subscription retention is such a fertile ground to use them. It is complex to craft the right series of messages that suit a particular customer’s psychology; there is no silver bullet.

Another example would be Altercasting, and if you combine it with Loss Aversion then you’re golden – only if you match it to the right customer psychology, that is. Altercasting taps into each person’s aspiration to live up to expectations or to live up to the image of a greater self. You project a role and get the visitor to aspire to fill that role. “The best fund managers like Donald Parsons predict stock market crashes before the average investor. The XYZ subscription gives you that predictive edge. What kind of investor do you want to be?”

You see, we don’t spend our days thinking we want to cancel a subscription, so I just need to squash the thought when it happens.

And yes, it can be through as crude a method as: “We just extended your subscription by 48 days for free because you’ve been such a loyal customer”. I just pushed back your yearly subscription cancellation decision.

The 48 days isn’t random, I want you to forget when it’s time to cancel again, and most customers will sign-up for another year.

It’s fascinating to see how in this digital world of ours, marketers are obsessed with the technology silver bullet, the algorithm, the machine learning to generate revenue. Let me burst that bubble.

It is a complex exercise to marry the billions of data signals we have, the algorithms we use with consumer psychology and the actual living people.

However, get it right and you can see your churn rates go down and margins increase. But only if you are willing to put in the extra effort.


First published at Marketing Tech