September 17th, 2009 by Bob Bly
?Renewal rates are a function of the quality of the editorial? is common advice among specialized information publishers.
It?s the truth. But it?s not the whole truth. There are 5 factors affecting your renewal rates, and the quality of the publication is only one of them ? albeit the most important one.
The 5 factors are, in order of importance (though I admit the priority is debatable):
1?Editorial ? If subscribers enjoy the newsletter and find it valuable, they will renew. If they don?t, they won?t.
And by ?valuable,? we don?t mean just good writing and good content. We mean actionable news, advice, or ideas that generate an ROI equal to many multiples of the subscription price.
2?Price ? Your subscribers want to feel they are getting a substantial discount on their renewal, preferably your lowest available rate.
You can often move some subscribers to renew now instead of later by dropping hints that the low renewal rate is a special one-time offer that may soon expire.
3?Market ? The conditions in your market can have a drastic impact on renewal rates.
Example: b-to-b newsletters earning substantial revenues from corporate site sales suffer when a recession or industry downturn causes major subscriber companies in their market to cancel subscriptions, either from cost-cutting measures or bankruptcy.
4?Acquisition promotion ? Am I saying the acquisition promotion can have a greater effect on renewal rates than the renewal promotions?
Yes. Reason: the acquisition promotion sets up certain expectations in the subscribers.
An acquisition that boosts front-end response through exaggeration or misrepresentation of what the publication actually delivers runs the risk of lowering renewal rates on the back end.
5?Renewal promotion ? Some marketers believe renewal copy makes little or no difference in renewal rates, and for them, it may.
But many other marketers get significant lifts in renewal rates by creating and mailing strong renewal efforts.