Yearly Archive for 2010

Behind-the-scenes Fastcase Subscription Site Case Study: Why They Don’t Hire Virtual Staff

Date: December 7, 2010 Topic: Operations Tags:

We just published a new exclusive Case Study in Fastcase. I was lucky enough to conduct the interview myself as Insider’s normal editor Sean Donahue was out on paternity leave (congrats Sean!) One neat thing you won’t find in the Case Study is the fact that this subscription site with more than 500,000 paid online users requires that nearly all 20 staff members work out of its offices in downtown DC.

I thought that was kind of strange, given how (a) incredibly hard it is to find and hire truly outstanding people (yes, even during a recession) and (b) how the Internet has made it possible to allow folks to work virtually, thus expanding your potential employee pool. Why limit yourself to just the best pros in your hometown? Especially when that town is DC with almost nil un-employment in the sectors Fastcase hires in.

CEO Edward Walters told me he considers NOT being a virtual company a critical key to their success. “There’s a real value to having a close knit team. For example, anyone on the team can pop into my office for five minutes when they have a cool idea. We did the virtual thing for a year and a half, and it was much harder and less fun. The office was better. You don’t have to reinvent everything to be successful.” I laughed when he said that and asked if he was wearing a suit. “I’m wearing jeans,” he replied.

So, aside from field sales reps and a single programmer who moved with her spouse and now works from home, everyone else at Fastcase is in the actual office.

That’s not the case here at SubscriptionSiteInsider.com. We do have an office in Newport Rhode Island that I and two other staffers work from. But Rhode Island has a very limited workforce to draw from, so we do extend offers to virtual workers. For example Editor Sean Donahue is in Portland Maine and CFO Cassandra Farrington is in Colorado. It would be cool if they could all be here. The energy in the office when folks fly in for our quarterly in-person meetings is tremendous. I guess I’m a bit jealous of Fastcase…..

Posted by Anne Holland
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Most Subscription Sites Are Breaking US Laws: The Perils of Autorenews and Trial Offers

Date: December 3, 2010 Topic: Card Processing, Recurring Billing, The Law & Paid Content Tags:

I’ve been involved in selling and reporting on selling online subscriptions since 1995. On a daily basis. So I’m kinda freaked out by all the new stuff I’m learning as we work with specialist attorney Lisa Dubrow on our upcoming virtual workshop Laws on Recurring Billing & Trial Subscriptions: How to Avoid Trouble.

There are more laws and regulations on autorenewals for online subscriptions than I ever suspected. California just enacted a new one this month in fact. And now that 52% of online subscriptions sold to consumers are sold using debit cards, even the Federal Reserve Board is getting into the act of regulating our industry with their Regulation “E”. (The darn thing is something like 600 pages long, but I’ll have our editors excerpt out the section that matters and post it on the legal section of our site shortly.)

The other thing that’s been freaking me out is how incredibly hard finding good samples for the presentation has been. It’s super easy to find samples of online publishers breaking the law. Because nearly everyone is. Ignorance is rife. For example, did you know you may have to send a printed retention notice via first class postal mail 30 days before you auto-renew certain online customers? Or how to copywrite your free trial offers so as not to fall afoul of Regulation E?

But does it matter? Why should anyone care if they are breaking the law if it’s never enforced? I asked Lisa Dubrow how much we really should worry about this stuff. She said the problem now is that watchdogs are starting to really look for violations. And, even if a state government or the feds don’t come after you, because to them you are small fry, the credit card companies are now starting to act as judge and jury. And to them, small fry are the easiest merchant accounts of all to cut off. So it’s not prison or fines you have to worry about so much as it is losing your ability to charge customers using Visa cards… permanently.

Posted by Anne Holland
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B2B Premium Niche News Publisher Says His #1 Subscription Marketing Tactic Isn’t Online

Date: November 30, 2010 Topic: Attracting Traffic, B2B Subscription Sites Tags:

He’s got a great Twitter following, a strong opt-in email list and solid SEO for keywords that count in his industry… but publisher Dan McGovern of the premium b2b news site, Sustainable Food News, told us in an exclusive interview for our Case Study this week that an offline marketing tactic is what sells the most subscriptions.

Turns out Dan’s most important subscription marketing tactic is getting on a plane and personally attending as many industry events as possible each year. He goes to nearly a dozen shows a year, showing up even if he’s not one of the
speakers. The point is to meet as many execs in person as possible.

It’s paid off for Dan’s site which now boasts subscriptions from more than 200 companies in the organic food industry, including some highly profitable site licenses.

But, it’s diametrically opposite of what many other online publishers do. Most tend to sit behind their computers and build virtual relationships instead of real-world meetings. Plus, most b2b trade magazines have cut back in travel budgets so harshly that few reporters ever go to real-world events anymore.

According to Dan, that could be hurting their potential subscription business. Just because you’re a virtual publication doesn’t mean you should do everything virtually!

Posted by Anne Holland
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How Wikipedia’s Missing Out on Substantial Funding

Date: November 22, 2010 Topic: Recurring Billing Tags:

wikipedia's donations form Every year at about this time, Wikipedia runs site-wide ads pitching for donations. There’s a tasteful series of photos of Jimmie Wales making his personal appeal and then an offer for the amount of your choice from $20-$250. You can give via the form or through a wide variety of avenues.

But, unless you’ve integrated Wikimedia into your payroll deductions (which is, frankly, a bit much) you can’t opt to have your credit card charged on a monthly basis. No recurring billing option. Jimmy, if Doctors Without Borders, not to mention my local church, have no compunction about asking me to plunk down a credit card number to be charged in the amount I desire as a routine monthly donation, than why don’t you? Even if only 10% of all contributors said OK to a recurring charge, and you only got say six months worth from each, that’s still a sizeable addition to the pot.

No, Jimmy just wants that one-time donation from me annually. Every year I give something. But I also am annoyed by the lameness of the offer.

Posted by Anne Holland
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4 Common Recurring Billing Mistakes TechSmith Makes: How NOT to Handle Annually Charged Customers

Date: November 19, 2010 Topic: Card Processing, Recurring Billing, Retention & Renewals Tags:

I am a fan of TechSmith. We use their Camtasia software for many of our on-demand tutorials and I was impressed to discover their service team frequently monitors Twitter looking for customer questions and concerns to answer.

But when I got an email receipt out of the blue from them this week, when as far as I’d known I hadn’t bought anything in months, it was definitely a WTF?! moment. And it’s one that I fear many subscription-based businesses are causing in their annual customer bases – needlessly.

Charging an annually renewed customer is a tricky business at best. Too often they may have completely forgotten either about the subscription as a whole, or that now is the day it’s going to be renewed. Suddenly their budget has a bigger hole in it than expected. We detail in Insider’s Renewals Optimization Kit the practical steps you should take to ensure great retention. TechSmith broke some basic rules that now probably hurt their retention:

#1. No reference to the renewal in the email
Their generic “you have been charged” email receipt doesn’t explain why the charge has happened or that it’s a previously authorized renewal. It could as easily be for a new sale made that day. In fact, when I got it, I assumed that someone had fraudulently used my account to buy something.

#2. No marketing copy or “gift” in the email
The email baldly states the product purchased and the price — as I said it’s a stripped down receipt. But, best practices in retention are to add a bit of schmoozing into the message. Not, perhaps, an povert sales message, but at least a benefit statement. And popping in some type of gift, such as a free download in ‘thanks for your loyalty’ can go a long way to ameliorating the unexpected charge situation.

#3. Receipt sent after the charge was processed
Processing refunds costs you money — probably a flat fee plus a % of each refund. You know that a certain portion (hopefully small) of all your annual subscribers are going to bail when they get that receipt. It’s a given. So why charge everyone (which costs you money for card processing) and then pay to process those refunds afterwards? Smart recurring billing merchants send an announcement FIRST for annual renewals and then wait for the cancels to come in before they actually process any transactions. Some wait a day, others a week. You have to watch your cencel patterns to know what’s best for you.

TechSmith actually processed the charge before alerting me and now have to reverse it. Not smart.

#4. Make customer service super-easy to access
Well trained service reps can actually save (or cross-sell/upsell) a certain portion of accounts when people call in to cancel. But, perhaps more importantly, they save customer goodwill. If you offer a range of products and services to the same customers, as TechSmith does, you don’t want to leave anyone with a bad taste in their mouth because you lose that future possible sale.

Every barrier you put in front of your customer – even irate ones – and your service team hurts your bottom line. Unfortunately TechSmith requires that customers enter a username and password (which they’re unlikely to recall a year after a purchase) just to get to a form which they then have to fill out and hope that a human being will get back to them. Money falling off the table. Look at it fall….

I feel kinda mean using TechSmith as a poster child for worst practices when so many continuity merchants and subscription services make mistakes that are just as bad. But, if this example helps someone, then it’s worth it.

Posted by Anne Holland
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