Weekly news roundup
1. Butter raises $7M to end ‘accidental’ customer churn due to payment failure – Techcrunch
Butter, an American startup aimed at helping companies retain existing customers and sign on new ones by preventing accidental payment churn has raised $7M in venture capital. Using machine learning, Butter aims to end churn by preventing drop-off from legitimate payments.
“In a year’s time, [Butter] has also signed on about a dozen consumer subscription companies, including some large names […], doing $10 million to $500 million in revenue — many of which have an international user base. It claims that it helps these companies find, on average, $1 million of revenue per year.”
2. Newspapers reluctant to change irksome cancelation practices – Nieman Lab
A look around the internet suggests the Federal Trade Commission’s vow to ramp up enforcement hasn’t scared American news organizations into immediately changing the cancelation options they offer online, writes Nieman Lab.
“Overall, it seems the number of online complaints about having to call to cancel reflects the number of subscribers a news organization has. (Top performers like The New York Times and Wall Street Journal being two of the most-cited examples.)”
3. 27% of subscribers have experienced a declined payment within the past year – PYMNTS
27 percent of subscribers say that they experienced a declined payment within the past 12 months, according to a survey of 2,195 U.S. consumers.
“The share of subscribers who have faced this issue differs notably across different subscription types. Forty-five percent of consumer services subscribers reported having declined payments over the past 12 months […] Consumers who use streaming services, on the other hand, are at the lower end of the spectrum, with 27% of music streaming subscribers and 25% of media streaming subscribers reporting experiences with declined payments over the past year.”
4. Carrefour launches delivery subscription – Retail Detail
French grocery giant Carrefour is looking for new revenue models and is embarking on a delivery subscription service for the French home market. The service is aimed at city dwellers who regularly place online orders and, often, don’t have a car to transport large quantities.
“The monthly shopping basket is delivered free of charge. For customers ordering over 50 euros, there is no subscription fee either, but rather, they receive a 5 per cent discount. Carrefour also promises that the prices of the selected products will remain fixed as long as the subscription is running.”
5. Amazon launches a $19.99 per month elder care subscription for families – Techcrunch
Amazon bas announced the official launch of the Alexa Together subscription service, aimed at families caring for elderly members who are still living independently but need extra support. The feature expands on Amazon’s existing product Alexa Care Hub and packages it as a $19.99 per month or $199 per year subscription service.
“Alexa Together expands on the Care Hub feature set to combine access to an emergency helpline, fall detection response features, a remote assist option that allows family members to manage settings on the elderly person’s device and an activity feed for family members that notifies them when their loved one is active […]”
Weekly analysis roundup
1. Why subscription media services don’t have to accept churn as a fact of life – LightReading
Involuntary churn can represent anywhere from 20% to 40% of overall churn rate; however, it is much more easily addressed when compared with voluntary churn. With the right tools and strategies, companies can reduce their involuntary churn significantly and see a direct increase in customer lifetime value, writes Vijay Sajja, CEO of Evergent.
“A company’s churn rate – the percent of customers who no longer subscribe to the service – has a direct impact on business growth, affecting everything from soliciting investments to building accurate financial projections.”
2. From freemium to premium: Boosting conversion with the right payments strategy – Subscribed
How can you get free users to convert to paid subscribers? One overlooked tool is your payment experience, writes John Phillips, General Manager EMEA at Zuora, and offers three tips to optimize conversion.
“The decision point — where the consumer makes a commitment and enters the payment page — is critical. If they don’t click now, everything you’ve invested in the customer up until this point goes to waste.”
3. You are a subscription business, whether you know it or not – Forbes
The first thing you think of when it comes to subscriptions is a newspaper or magazine. However, we have all been buying subscriptions, whether we know it or not, writes Shep Hyken at Forbes.
“The business of a subscription model is powerful and convenient for both the company and the customer. For the company, it is recurring revenue. For the customer, it is the convenience of not having to think about it. “Stuff” just shows up or services just happen.”
