Data Analytics: non-renewal stops with these traits are more likely to restart service

By Yao Swanson Published July 19, 2016

Raleigh, NC, July 19, 2016 - In last month's newsletter, we identified several root causes that compel long-term customers to discontinue their subscription. The initial analysis consisted of over 3,000 survey responses of customers (across 29 daily publications) whose subscription was discontinued upon the expiration of grace (i.e. "non-renewal"). Our initial analysis showed that 38% of customers identified price increases as their primary reason for discontinuation, 30% identified unresolved service issues and another 14% indicated they no longer read the printed edition.

To further these findings, LEAP Media Solutions has employed a predictive analysis on the same dataset and examined the key factors that predict the probability for these former customers to subsequently reactivate their subscription.

The analysis consisted of email records for which we could connect to a physical address (and thus their demographics), and then compared a variety of traits between 289 former subscribers who reactivated their subscription and 529 former subscribers who did not. Those traits included both behavioral (e.g. subscription delivery frequency, payment method and start reason) and demographic traits (e.g. age, income, Acxiom demographic segment and length of residence). Finally, we compared the survey response data (e.g. "would you like to be contacted...") to detect patterns on probability to reactivate service. Logistic regression results suggested that former subscribers with the following four traits are more likely to renew their subscription:

The above findings have important implications for publishers. The ability to proactively identify and engage high-value customers who are "at-risk" by virtue of them entering a grace period helps to reduce the instance of non-renewal, thus saving precious dollars that must otherwise be directed on reacquisition.

Knowing the customers who request to be contacted by phone or email allows the publisher to provide rapid and personal attention from the individual in the organization who is best positioned to resolve the customer's concerns.

For those customers who do stop, a reacquisition index (similar to the LEAP TGM scoring model) can be established by ranking each former subscriber in terms of their likelihood to renew based on these traits. For example, a former subscriber who scores the highest on all four traits would have the highest reacquisition index, and therefore should be appropriately identified and targeted for reacquisition effort. (i.e. right offer, right time, right channel).

Publishers employing the LEAP customer intelligence platform and marketing automation system have the advantage of leveraging not only this behavioral information, but to score and segment these customer records in order to optimize their marketing activities, improve retention and reduce waste.

Yao Swanson is a Data Analyst with LEAP Media Solutions and based in Raleigh, NC.

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