Creative media content has greatly evolved over the last two decades. Gone were the days when VHS and cassette tapes were the main sources of video and audio entertainment. Even today’s CDs and DVDs seem like they are well on their way out of the market. Virtually every form of modern media is now available online, whether they’re podcasts, TV shows, movies, music tracks, or even video games. The rise in demand for over-the-top (OTT) online content has created the perfect opportunity for entrepreneurs to start their own digital content subscription businesses.
However, running a digital content subscription business is not as simple as some people may think. There is more to the business than just having a collection of media available for download. If you want your business to be profitable, you have to understand the three keys to its success.
Getting the Most Valuable Customers
Your digital content subscription business may have a lot of new subscribers per month, but it won’t be that successful if you don’t prioritize your most valuable customers. High-value customers are those who actively seek out your products or services and are more likely to bring in more potential subscribers to your business. There’s no need for you to spend a lot of resources just to convince them to keep subscribing because they themselves want to keep their subscription.
Sorting through every single subscriber to find your high-value customers can be a very tedious process if you don’t have the right subscription management tools. With the help of a powerful subscription platform, you get quick access to important data such as subscription trends, payment methods, and customer behavior, allowing you to identify your high-value customers and come up with the right innovations to cater to them.
Reducing Customer Churn
Customer churn refers to the customer action of terminating their subscription. If left unchecked, it can cause massive losses on your end, and your business might not even get to recoup the costs of customer acquisition. Needless to say, you’ll also miss out on the opportunity to earn revenue from what could have been recurring subscriptions. Preventing customer churn is just as important as identifying high-value customers because it creates an opportunity for nurturing more high-value customers in the future.
With the help of a subscription billing platform like Vindicia, it would be easier to spot signs that a customer has a high chance of churning. Reduced usage, regular delays in payment, failed payment transactions, and failure to replace payment options can indicate a lack of interest in continuing their subscription. Using this information, you can come up with strategies that are aimed at appealing to your customer’s interests and keeping them from unsubscribing. Moreover, a proper subscription billing platform also automatically resolves failed payment transactions and other points of frictions, thereby naturally reducing customer churn in the process.
Being Flexible With Your Business Model
This key point is heavily tied to the previous two. By having a subscriber base that comprises high-value customers, your business has more leeway when it comes to trying out different business models. Because subscribers are more likely to stick to their subscriptions, they are also more open to changes such as opening the business to more billing options or changing your pricing schemes.
For example, upgrading from HD to 4K content format for your video services could pique your subscribers’ interests, but making the change will require more powerful and more costly servers. You might have to adjust your payment plans to keep up with the new costs, but low-value customers will likely just bail out and look for an alternative subscription. As such, consider providing the option for your customers to upgrade to 4K or to retain their HD subscription.
It’s also important to note that big changes to your business model could cause inconveniences to your customers. Having an easily scalable subscription management tool can go a long way in speeding up any transition and minimizing difficulties for your existing subscribers. In fact, providing a smooth transition can even help build up your image with both existing and potential customers because the subscribers will see that you are a reliable provider.
In an age when people can choose among a lot of businesses that offer subscription-based digital content, success greatly relies on keeping your customer from making a switch to your competitors. With proper decision making and help from powerful subscription management tools, you‘ll be able to nurture your existing customer base, keep them interested, and continue to do business with them for a very long time.