Fast forward; future-forward. Today, we are operating in a challenging period. Perhaps, we are even in the midst of one of the largest obstacles witnessed in our time. From coming and going as we please, face-to-face meetings, live sports events and dinners at restaurants, the world made a startling detour from normal everyday life. The new world for the majority of us now consists of a virtual reality, dominated by videoconferences, eCommerce, online learning, binge watching an overabundance of content and the list continues. Our routines – and the tools that accompanied them – have departed from the norm, and in record time.
In addition to our daily lives, I, as a long-time member of the service provider industry, with a strong emphasis on subscription-based spheres, can say that this environment is currently shifting every second – and more than that – it has already entered a period of a business-altering revolution. Each day, as I serve in the role of Head of Growth at Vindicia, an Amdocs company that supports B2C businesses that rely on subscriptions and recurring revenue – I stand as a witness to the ongoing digital transformation, the evolution of new businesses and thus business continuity. In a previous blog post, I spoke about the importance of building lasting relationships with your customers through lending a helping hand during the pandemic. In this post, I will discuss how you can propel this humanized strategy with the power of data, while increasing revenue, decreasing churn and ultimately improving the overall customer experience.
It is rarely a “one size fits all” situation
Speaking with customers and partners is a core activity in my role; each and every day, I reach out to core partners to better learn and understand the constantly moving landscape and how their businesses are being impacted on the ground. In my opinion, there is not a replacement for the human-factor and corresponding attention I discussed previously, which is needed more than ever in a time of increasing social distancing and isolation. But, as an individual who has operated in this industry in different corners of the globe, I understand the necessity of making decisions that are the best for business and the customer base – even when the situation is not one hundred percent familiar. While not on this scale, I have been at the crossroads of change as well as a digital transformation before.
Register for our free webinar on July 15th.
Thus, there are lessons that we have learned. When operating through a challenge, there is an obligation to conduct thorough research, gather data, decipher trends and strive to be consistently one step ahead, and the current global situation is giving businesses the opportunity to use this time to reshape their strategy and growth plans moving forward. But the answer is not always the same for each player across the board; there is an array of fluctuating factors that create a complete picture for executing a successful plan of action, specific for a target audience, industry or region. It is rarely a “one size fits all” situation. Today, in a time of almost complete unknown – being in the know, or as close to is as possible, is a privilege. And, the quicker, the better. With the right tools, I believe that it can be a feasible goal to strive towards. The answer to solving critical business obstacles, including a multitude associated with a bottom-line pain point: churn, is through data and successfully analyzing the new reality and corresponding behaviors. Making decisions in a time of an anomaly, based on data-driven insights and trends, rather than a gut feeling, is where I believe we should be in the world of subscriptions and subsequently customer retention.
We have all heard how COVID-19 drives businesses to become more digitally savvy. Yet, what this really means is those that are positioned in the front of the pack as well as those that do not want to fall behind must adopt a proactive data-driven mindset. Data is what keeps you one step ahead; this can be witnessed with the way countries are dealing with the current crises and beyond. Making decisions in unchartered territories – with a data-driven compass – is what will allow one to successfully become a disruptor and a main player in the post-pandemic world.
Combatting customer churn during COVID-19 with data
As I stated before, during this period of COVID-19, “some voluntary churn is inevitable, but managing passive churn, for those customers who want to continue the great recurring subscription relationship with your business, is critical. Always leave the door open for customers to come back once life returns to normal. It’s better to lose out on a few months of revenue than a subscriber’s entire customer lifetime value.” People are facing uncertainty, and anything subscription businesses can do to help alleviate their concerns is welcome. Subscription businesses can act with compassion and empathy, doing their part to ease the financial strain created by this crisis. It’s the right thing to do for both your customers and your business.
This time, the picture it framed with a slightly different angle. Imagine combining the above influential techniques with the increased power of analytics and data-driven decision making to increase overall retention and thus revenue.
We, at Vindicia, understand that a large obstacle to grow in general is combating customer churn. It is a frequent factor that virtually every business suffers when you have a subscription-based service or business model that relies on returning customers. In this context, and for a little background, there are two types of churn that we refer to: active and passive. The first is when a customer makes the decision to leave on their own accord; the second is when an account is terminated unwillingly. Despite all the effort businesses devote toward experience enhancements that address active churn, many are less equipped to deal with passive churn. This occurs either because the risk is not known to the business, or the tools and capabilities just are not there to successfully deal with it. Passive churn, a group that if approached with tactful ease – can account for a large portion of a company’s revenue (in average 10-20% of monthly revenues). But it needs to be noted that bad experiences multiplied across the customer base can be seriously damaging. When you dive in, it is integral to find the distinct behaviors that are correlated with users who were at risk of churning. Finding and understanding this data is possible and is more important than ever today. Interrupting a happy user’s experience can be the endgame.
Subscription intelligence powered by 17 years of data
At Vindicia, we have processed almost a billion transactions worth several tenths of billion of dollars. Our subscription experts have analyzed our wealth of subscription data to find better ways to manage recurring subscription payments. Across the entire subscription lifecycle, we have developed a deep understanding of the complexities behind subscription billing that turn failed transactions into customer relationships with increased longevity.
In short, our cloud-based, SaaS platform helps fuel growth across the entire subscription management lifecycle, delivering higher revenue at every stage. Our clients acquire, bill, retain, and grow—as they deliver a frictionless experience to their customers. And, now during this time, business continuity, as described above, is more critical than ever for subscription-based business to continue to grow through this challenging time and beyond. Subscription intelligence lets you take advantage of data to understand customer behavior. You can explore what has happened, what is happening, as well as what is likely to happen. This allows you to make decisions that improve performance and customer retention. In addition, the benchmarking abilities and cohort analysis can help you reveal changes that could make revenue higher. Our robust analytics, based on an evolving data set accumulated over more than 17 years, can illustrate distinct industry behavioral trends, including regional, categorical and more data types, allowing you to be ahead of the curve and create a launching pad into the future, post-COVID-19 world.
Data further helps to bridge the gap between churn and retention on various fronts. A further pain point that I wanted to briefly touch upon is the ability to provide a positive user experience. I believe that we might all agree that this is essential to growth and success for any subscription-based company. Consumers have many options at their fingertips, and they aren’t going to look solely at the quality of the product or service — they’ll also look closely at the customer experience. One bad experience, in turn, could prove to be the catalyst that sours an otherwise satisfied, paying customer and takes revenue off the table. Especially during this time and after where every second, every penny will count in subscriber decision-making.
Be ready today and tomorrow, post-pandemic
Predictive analytics is a major tool for growth and we see that in every industry that we work with – from eLearning, telcos and publishing to connected fitness, retail, eSports and eCommerce. Through data you can help keep customers who want to stay by reducing involuntary (typically referred as passive) churn. Our technology helps to resolve failed transactions without the service interruptions that can turn passive churn into a subscription suspension or cancellation. Average customer lifetime value and revenue increases—as the customer experience improves. The goal for all of us is to recover the higher levels of lost revenue fast, which during this time, is a powerful engine for growth. Today and in the post-pandemic world, what we can say is that there has been a deviation from business as we knew it. The best way for companies to be ready to take growth to the next level in this dire period is through operations that lead to data-driven actions. Be ready today and tomorrow – and lead into the future.
We have created and are continuing to accumulate a mountain of data. What factors interest you in regard to your growth? We can help you find it. Reach out to our team today to find out how we can help.