They're doing in-home coffee, merch, etc. and now a big chain of pure retail locations. Starbucks is really starting to open up alternative revenue streams. Good for them.
This is a good article. I have a few issues with price-reduction for existing customers, though, that I want to highlight. I think it's fantastic that OP got the desired results on customer churn, which was his goal - but I'd categorize pricing changes as "gray hat" retention improvement with regard to the overall health of his business and future revenue. Here's why:
On price specifically: In a subscription business like this one, you have to meet a minimum utility requirement in each month that a customer is able to cancel if you want to retain customers. Each customer's minimum utility is different and could even be comprised of different factors/features depending on the breadth of the product offering. But there is one factor that cuts across all of them: price. A significant element of churn is price because the initial purchase thrill may decrease over time and result in customer cancellation requests at a certain point in their lifecycle. So, cutting price is kind of an easy way to reduce churn in a subscription model...particularly because people bought in at X and are now paying fractional X. Boom - happy customers. Also, price-cutting is habit-forming, and the customers who received a reduced price will come back asking for more reductions in time.
On features: Multiple times, I've seen the "get more people using our product" as a good way to reduce churn. I won't comment on permission customer marketing and whether or not what OP did was legal, but the results of a feature like this are great, and seems like he added more than just this one. He added improved functionality and invested in his product at reduced prices - great deal!
On onboarding & cohort analysis: OP was right to focus on onboarding features and adoption to improve stickiness among new cohorts. He would have also been smart to raise the price for new customers if he materially improved the product (which it sounds like he did). Over the same time period, he could have had newer cohorts of higher paying customers, making the older ones less important to the financials of the business. By "hiring" higher priced customers to increasingly recent cohorts and continually "firing" older-lower-priced customers, the balance of his revenue would have shifted to these newer, more valuable customers over time, making the older-less-happy customers less important to his business. That's how you really turn the crank on a subscription business, and if your onboarding is good enough to continually improve retention in new cohorts, you've really nailed it.
Overall, I don't mean to be overly critical of OP's choices. I aim to highlight where optimizing for customer churn alone can harm the financials of the business, particularly around price-cutting for existing customers. He's doing lots and lots right with his cohort analyses, onboarding improvements, and assumptions about churn impact of new features. However, we're in business to make money, so these have to be balanced with the health of the business itself.
You can create a set of 301 redirects to make sure traffic that is sent directly to a given post finds the correct page. It will also let search engines re-index your content at the new address.
You can do this by dumping the relative paths of your previous blog posts and current ones into your .htaccess file. This won't get all of the old links (category/tag links, for instance) but at least direct links to a specific post will end up in the right place.
I guess the only way to accomplish that is to set up the new blog on my own server where I will have access to a .htaccess file. That is, I can't use any hosted blog like blogger, tumblr, wordress.com. Is this correct, or are there any hosted blog services that will give you this fine-grained control? Or are there any things I can do on the domain registrar side?
Alternatively, is it a good or bad idea to route all traffic to my blog through a VPS I have, so that all the old blog post addresses go to the right place on one of the hosted blog services? (I'm just trying to avoid hosting my own blog, since I assume there are a lot of headaches involved)
I decided a while ago to move my personal site from Posterous to GitHub pages [1]. It's been a little tricky to set up but only because I'm fussy and haven't messed with css before. Still not finished since I can't find a sensible way to extract my content from Posterous (that dosen't involve the API).
With GitHub pages, you don't need to worry about the hosting aspect and you'll always have a copy of your site locally. Pretty sure you can deal with the .htaccess file stuff too.
If you decide to look into this, check out Jekyll-bootstrap too [2].
I moved mine from Tumblr to GitHub recently and used a migration script to grab all the posts and turn them into Markdown files. There's a script that works with Posterous too: https://github.com/mojombo/jekyll/wiki/blog-migrations
edit: I've just realised I don't need the code to be merged into jekyll in order to use it (facepalm).
edit2: ok, maybe not as straightforward as I thought. I'm not really a coder so it takes me longer to understand what scripts are doing (and then tweak them so they work for me).
Routing all blog traffic through your VPS is a bad idea, IMHO. Your VPS becomes a single point of failure for your blog - if it stops working all of your posts are unavailable, not just the ones that require 301s.
I think that's precisely what parent comment is referencing; the Music design scheme may be familiar to Android users, but non-Android users likely see it as a bit surprising/inconsistent. Two quick examples: button styling and top account-bar background.
This is also somewhat revealing of how Google wants this app perceived. I see it as leaning _heavily_ toward a native experience on Android devices, and a push from that mobile experience into the browser. It's interesting.
Of course more market share is good. But Microsoft is not purely interested in growing share with Bing; non-differentiation with Google is a good thing in and of itself. The less differentiated Microsoft is from Google, the greater perception of their platform having feature parity with Google. That way consumers are not forced to choose based on features, just ecosystem.
This is a the reason that Microsoft is a fast copier of market leaders, so that everything consumers could want, on paper, is housed within their roof (and Google's). It seems counterintuitive that less differentiation would be useful, but I think it's what Microsoft is going for.
Microsoft used to be able to "embrace and extend" in order to extinguish the competitor. With Bing it seems they can only "embrace", by which I mean copying and trying to decrease differentiation. But look at the trend. In the future, when/if Google search incorporates social feedback effects (ala +1), Bing won't even have the user-base to be able to copy the competitor, let alone extend and extinguish.
One look at my website statistics tells me Bing is already as good as dead.
I'm not completely convinced that Bing lacks the user base to compete with Google. There are diminishing returns in user base volume after some point, and Bing has around 100mm US users[1]. I think any of us would be pleased as punch with that volume and it's not clear it's not enough to do something-social-with-search.
Disagree for the most part. There's always something that can be given away for free: blog posts, free trials that lack support and require a paid upgrade for it (e.g. Magento), ebooks, contest giveaways, etc. If you can't give something away for free as part of your marketing, you're probably not thinking creatively enough.
Not that this isn't a cool analysis, but seems as if there's selection bias to these data. Lots of psychographic segments will never start a search with "how can I...".
And the better the offer, the more a landing page can "get away" asking for. Offering a month of free software? Test and see if you can extract a company name and role from the visitor, or even a phone number. Offering just a short article or low-value offer? Stick to email and name. People are so used to filling our forms with their information online that if an offer is compelling, you can really push the limits and ask for an extra piece or two of important info.
- The first one, even with all its well-known shortcomings, was "Rich Dad Poor Dad" by Robert Kyosaki. It opened my eyes to "there's another option out there".
- Benjamin Franklin's autobiography (translated into modern English).
- PG's "Hackers and Painters" (why I joined this forum).
- Tim Ferris's "Four Hour Work Week" (has to be taken with a gigantic grain of salt, but has many very helpful and practical tips and ideas.)
- "Mastery" by George Leonard
- "Good to Great" by Jim Collins
And finally (and I don't want to turn this into a political flamewar, "grain of salt" applies here as well, etc, etc) but the book that had the most influence on me was "Atlas Shrugged" by Ayn Rand. Unlike all the others on the list above, it's a work of fiction, but I think it is the best at capturing and romanticizing the joy and euphoria that you feel when you build something that works.
I would add: The Entrepreneur's Manual: Business Start-Ups, Spin-Offs, and Innovative Management by Richard M. White. It is out of print and by Chilton (the auto manual maker) and is dated, but a very fun read. Business is nothing new as this book will point out.
C'mon, it's not credible but it's a popular book that gets people to shift their perspective on money (I read it in 8th grade). I think it deserves recognition for that, even if the rest of Kiyosaki's stuff is pure shill.
