Guest
Mauro Bartoletti
Former Head of Digital Transformation
Episode description
Discover key objectives, learnings, and pitfalls to avoid when running a subscription business within a product organization. Delve into essential topics like setting up the right technology and infrastructure, the importance of customer experience and value proposition for retaining subscribers, and the game-changing role of AI in enhancing operational efficiency and predictability.
Highlights
The flexibility I have in mind is that if you want to introduce an additional service, an additional feature, a premium functionality, your platform has to be able to introduce quickly, not to enter in a two-year project to make it happen. And this is not just a flexibility that you need to achieve technically. It’s also the organizational readiness to understand that this business flies fast. I was not referring to the need to change pricing or to be able to manipulate your proposition on the fly. Some businesses do. I’m not my favorite type of proposition, but just to have the capability and the agility in your organization to be ready mentally to accept the always-in-beta type of concept, but also then have a platform that has that extension of your flexibility.
Nowadays, I would say that you need to make two calls related to the need of efficiency. So the world is moving fast. Artificial intelligence, machine learning, competitors are effective and efficient. You cannot always be clunky. You might start, but at a certain point, you need to move out of the compromise. And in that sense, if you design good integration, you start identifying your data, and structure your data correctly, you can then leverage several aspects technically that can help you in engaging with your customers. So if you build it correctly, your data set, if you understand that you can create your machine learning parts and understand usage, churn rate, parts you can develop technically – aspects that are not strictly necessary to launch a proposition, but they would be fundamental to offer the proper customer experience because at the end of the day, I think the challenge is not to introduce a different pricing mechanism to access a product. I think that this is the secret that everybody knows with subscriptions to be achieved, is to offer a totally different experience and to engage with a customer.
So you decided to unsubscribe. It’s your frontend but powered by something. Then it’s up to you to decide if you want to put it in the billing system or into your CRM or whatever, but it’s very much connected. Your billing system might be called in action because maybe it’s time to offer Behdad a discount or a couple of months free in order to keep him in the loop. But I think this is already a too late type of action you might take with data. So to keep Behdad, yes or no, but more importantly, your billing system plus your data system must be able to understand much earlier before that Behdad decided to unsubscribe. That Behdad is at a risk to unsubscribe. And at that point your data set have to be able to call in action something to take Behdad back and remind Behdad that there is value in staying, and that’s where I think is the most strategic point not to have just the (type of) billing system that is (only) able to offer you a discount at the time you already decided to go. Use your data before the decision is taken to increase the value, keeping the price the same, but justify why I need to be subscribed, not to depreciate the value of the subscription.
Relevant links