Understanding Your Customer
The first step to maximizing revenue is having detailed insight into each subscriber’s behavior, usage patterns and preferences. Vendors must know: What content has the most up-sell potential to whom? Is there unlicensed use? Which subscribers show low usage and are at risk of churn?
The good news is that online services are especially well-suited for aggregating, analyzing, and acting on usage data in real-time to optimize revenues. Ironically, however, content and service provider companies historically haven’t made use of the data flowing through their networks: when faced with having to choose between investments in value-added services to subscribers vs. internal analytical tools, the internal tools typically lose.
Sales and marketing teams are still relying on cumbersome, legacy approaches to data analysis such as monthly e-mails containing spreadsheets of unprocessed usage data. Today instinct and intuition—rather than evidence—are the basis for answering business-critical questions such as:
If 10-30% of users are unlicensed, how do I identify which accounts are being shared?
If it takes 18-24 months to make a subscription profitable, which subscribers are at risk of churn?
Knowing that it’s is 80% less expensive to up-sell than acquire a new subscriber, where are my up-sells?
Subscription analytics is an emerging category of solutions that maximizes the lifetime value of a subscriber by providing deep insight to access and use of a service. By proactively aggregating and analyzing data from a subscriber’s session over time, companies can customize offerings, identify at-risk subscribers, and fully maximize the revenue potential of every subscriber. Subscription analytics can provide a breakdown revenue opportunities by company, by type (e.g., unlicensed use), and by estimated value. Armed with such actionable information, sales productivity has increased 15% or more among companies using subscription analytics.