A member saved is four members earned. So why is it so hard to keep the ones you have?

Rajeev Raman

February 4, 2021

It is 3x-4x cheaper to keep a member than to acquire a new one. So why do so many subscription businesses struggle to keep their members?

First, most have never asked the question "If there is one thing I can do besides lowering the price to make you stay, what would it be?". They haven't asked themselves that question nor the customer. Why is that? It's because most are afraid of stirring the hornet's nest lest it causes the member to think about canceling. This is a basic insecurity that is rampant in the industry. Most subscriptions are not confident they are delivering enough value to the customer to begin with.

According to a Gartner study, the number one reason people cancel a subscription is that they are not using it. Seems like a blinding glimpse of the obvious but the obvious is not that plain to see. Consider that for a typical content subscription service (entertainment, health & wellness, e-learning), understanding whether someone is "using it" involves understanding whether the person is accessing exclusive items, understands the breadth and quality of content, and uses features that are important to them on a regular basis.

Many of you are looking at the investments you have made in analytics and marketing technology and thinking that "We must know the answer to this, right?". Wrong. Pretty much every system out there aggregates information across users which inherently eliminates the ability to know whether Jane is "using it". When you take the question to the technologists, most will point you to a fancy event collection technology with fancy charts that is at the cusp of answering the question. Wrong answer again. Event collection systems are like a firehose. "Jane logged in. Jane logged out. Jane logged in.". What you need is whether Jane is logging in regularly or is logging in more or less frequently than last week. Ask them to set that up for you and you'll get an estimate of 3-6 months. Just for that one item.

Before we started Redfast, we spent months debating whether the world needed yet another customer software company. We realized quickly that much of the commercial Internet today amounts to big warehouse-style storefronts with no employees inside. No one seeing what the customer is looking for, or helping them find it, or guiding them to what's new. When Uber can dynamically change their price based on conditions in your zip code, we thought it should be possible for you to understand a member's intent based on their actions and, more importantly, guide them to what makes sense. That's Redfast.

Let us show you how 30M users each day are not only "using it more" but also staying longer and coming back more frequently.

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