the goose

Okay, I struggled with getting this blog post out.  It turns out that I’m far more interested in spouting on about the factors that effect churn rates when I’m in a pub somewhere.  That said, I promised to talk about the factors that influence churn rates and here are my thoughts on the type of application and how rates differ between them.

When putting together a subscription service – there are a number of factors I see as being critical to effecting how often your users bugger off and abandon you for someone else.  I covered payment mechanisms (which I think is a biggie) and now let us consider the type of application in descending order of churn-y-ness, as Colbert might say.
Entertainment: From getting laid to paying for your online gaming, entertainment falls strictly into the ‘nice to have’ bucket.  Yes – we all need to get lucky but lets assume we don’t need to pay a subscription service indefinably to achieve that aim.  Dating websites, star sign text message services all work this way.

Marketing:  Services that offer to get me more business tend to be less long term in nature.  We spent on Adwords a long time ago but never really got the RoI right.  I’ve tried paying for links in places like the Yahoo! directory but we won’t be doing that next year.  Our subscribers also face a bit of a decision each year as to whether or not they will continue.  In fact, I don’t have any long-lived subscriptions for marketing purposes apart from wordtracker (which I have to dump).  Of course I operate in this type of subscription market and enjoy comparatively low churn rates.

Operations:  I’d call ops anything you need and can’t do without.  At home this means water and electricity and in a business it means invoicing and backup.  You don’t fantacise about owning any of these but once you are in – it is hard to go back.  Looking through my subscription payments coming out of my credit card each month I see invoicing software, email marketing software, servers and online backup.  I’m normally pretty slow to pick up one of these recurring costs but once I’m in – I’m not going anywhere.  Changing invoicing software would be a big effort for maybe not that much reward.  The servers take forever to configure correctly and although I’m no fan of our hosting provider (who is) I’m not changing any time soon.  Installing my online backup tool was a pain on our Linux box (well not that much of a pain but it took time) so that isn’t going anywhere either.  The list goes on.