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The Hidden Value of Retention

November 18, 2014 • Direct Mail

How much more does it cost to gain three new subscribers in a year’s time, rather than retain one for the entire year? Or more? Our savvy newspaper executive clients are calculating this rather than simply focusing on Cost Per Order (CPO). Are you?

We get asked about CPO every day. Yes, there may be cheaper acquisition sources than direct mail if you only look at CPO.

Think about call center outreach, for instance. This probably generates orders for you. But a person on the phone is trying to convince the person on the other end to subscribe. They feel pressured. The orders gained typically don’t retain as well. Kiosk efforts generate similar results.

Direct mail is different. Research shows that only voluntary starts surpass direct mail retention rates. That’s because a person is actively engaged in a proactive effort to subscribe after they see your offer come in the mail. They are incented to do so, and they are under no pressure to participate. It’s their choice.

The newspaper executives we talk to who “get it” are investing in regular direct mail campaigns to acquire new subscribers, rather than ignoring its value in their mix because the CPO is too high. The retention rate is so high because it is a non-pressure, close to voluntary start source. You can’t get much better than that.

High retention rate start sources will increase your total subscribers over time. Few acquisition sources perform as well as direct mail. We can help. Let’s talk.

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