Leveraging Customer Data: How a Cable Company's Failure Can Help You
According to Forbes, approximately 5 percent of cable subscribers leave annually. This is being exacerbated by the introduction of new ways to access the same content. Subscribers are “unplugging”, requiring only an internet connection to watch their favorite programs. The competition between companies to add subscribers is intense, so poaching them from the competition drives a lot of communication. Customer loyalty in this environment is key.
What’s a modern marketing person to do? The easy answer is leveraging customer data to make the interaction something that’s both personal and relevant. We have the technology and the channels for communicating in a personal way because we know so much more about our audience. The trick is always in making sure every part of the customer journey leverages the same robust data, so the experience can be seamless and consistent.
The loyal customer is the best customer! From any company’s perspective, and certainly from a cable company’s, longevity, LTV increases and cost to support decreases with every year of loyalty. Yes, the competition will beat at the door, but the loyal customer doesn’t listen. In the case of a cable the best customer is also one that is resistant to change and probably still wed to watching cable, as opposed to using the newer ways to reach content. And, like me, they may just have higher priorities and think of this change as a hassle. As any social scientist will tell you, I suffer from status quo bias. And I KNOW my cable provider knows this about me. Most people wait until the contract expires and leave for lower prices. Even bombarded by better offers, I never did that.
Acquisition marketing works though. I’m guessing I received at least one solicitation per week from the competition and one of the “new” offers caught my eye. So, five months ago I called my cable company to say I would be switching providers based on price. I told my current provider that I was paying twice what the competition was going to charge me. I offered them the opportunity to come up with an alternative. Well, the cable company couldn't come up with anything to keep me. I was speaking with someone in customer service who had my records, “knew me” and my habits, or should have, and nothing could be done.
John Sisson is the President of Westwood, Mass.-based Wilde Agency, an agency that creates digital marketing and direct marketing powered by behavioral science to drive superior results for leading brands.