Saturday, 3 October 2015

Should you disturb them?


All subscription services have those customers who are on the wrong subscription plan (they are paying too much for their consumption, or end up consuming a lot more than their plafond and spend more because of that) and don't actively try to change. They seem to be passive on what regards those subscriptions, which, from an Economy science point of view it doesn't make sense - but hey, this is Human nature, and it doesn't abide by perfect laws.

A study published in HBR shows that an incredible percentage of consumers that are contacted by their service provider and offered a better, more suitable plan, actually move out after being contacted (10%, vs 6.4% in a control group that had not been contacted). Probably the contact is the eye opening that they are not losing money or trigger to break passiveness - either way, it seems the company actually increases the chances of losing a customer by contacting this group. So, should they not do it?

Not so fast! One should not forget the message - how are the customers contacted, how good is the offer, what is the objective of the contact. This was overlooked in the HBR study and is actually key for retaining and maximizing a customer's profitability. So, before rushing to contact your passive customer, just put yourself in his / her shoes, design a good approach strategy that is aligned with your objectives and be sensitive in the message you are conveying. That should be the way to do it.