Publishers face major challenges regarding the sustainability of their business model. It’s a quasi-permanent challenge.

Decision-making process about marketing and technological investments to ensure growth and increase income are therefore always sensitive subjects because they are complex and uncertain. Developing audience, improving advertising effectiveness, increasing premium content (and so on) are all important topics and potential sources of development.

Publishers have often privileged audience growth as the engine of their own growth, but these strategies are called into questions with the multitude of media actors (pure players or not) and the instability of advertising revenues. As we discussed in a previous article (“engagement is more important than the number of unique visitors“), developing the commitment and loyalty of its audience can prove to be an interesting strategy because it is potentially more remunerative and less costly. Particularly in a logic of developing subscriber base.

One of the subjects often less emphasized is the subscribers churn reduction (digital or print). Yet when we look closer it is an essential subject. Indeed, large investments are made by publishers to bring a reader into their website, retain him, and turn him into a subscriber (with a conversion rate usually lower than 1%).

Once the readers (finally) have been transformed into subscribers, it is necessary to put everything in place to keep them: churn risks must be prevented to guarantee long-term income.

How to prevent the risk of churn?

Numerous tests have been carried out by American publishers like Newsday and many others in recent months. They have successfully tested and proven a model called “churn modeling“.

What is the principle? By carefully studying their readers and subscribers, why they choose to subscribe or unsubscribe, publishers are able to predict the risk of unsubscribing (via a score of 1 to 100) and the cause. With this predictive information, publishers can implement corrective actions (through different channels) to limit churn and increase the retention level of subscribers.

For example, a decrease of subscribers’ engagement on the website may be an important indicator of the risk of churn. If the publisher finds a deterioration in the reader’s commitment over a period of time, he may put in place corrective actions to prevent the risk of unsubscribing. In this case one of the important indicators to follow is the DAU / MAU (Daily Active User / Monthly Active User) or the number of times a same user returns in the month.

Some examples of applications of “Churn Modeling”

These examples were presented by American publishers like Newday or The Columbus Dispatch, at a webinar organized by the Newspaper Association of America.

For example, these media have found that a change of payment method or delay is very often correlated with a future churn. By setting up a user-customized automatic message, the Newsday was able to reduce the churn and increase the LTV (Life Time Value) of its subscribers.

Another example: sending a gift to subscribers with the highest risk of churn, such as a thank you card or a product, also reduces the churn.

Proposing to test a product (up sell) for free as a magazine again allows to reduce the churn when the probability of unsubscribing is high.

These initiatives can be carried out upstream, in prevention. For example, the product test or the “free” up sell is a good practice when it is applied during the first 6 months of a new subscriber’s life. This increases the fidelity and the lifetime of the reader.

What are the benefits of such a model?

Churn modeling allows publishers, once the unsubscribe score is determined, to set up a stock of actions thanks to all the resources they have: content, product, sales team, automated messages … Many benefits can be noted, including:

  • Lower costs to retain subscribers than to acquire them;
  • More revenue on the LT thanks to an extended LTV (live time value);
  • Better customer satisfaction by creating a personalized experience;
  • Better customer knowledge.

Aside from the initial analysis, which can be challenging, churn modeling is proving to be an interesting way to allow publishers to easily increase their level of profit at low cost through a little creativity and using resources available to them.