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Vindicia in the News

As the subscription world curns, providers must get personal to avoid the cut

Jan 25, 2022 | By PYMNTS.com

"Usership, not ownership." That’s the new rallying cry of subscribers from gaming sites to streaming TV platforms as a new year of subscription delights beckon — all with a price.

After accumulating subscriptions with abandon during two years of lockdowns and restrictions, people are reevaluating their entertainment calculus, deciding what they can and can’t live without.

It’s on vivid display in the cloud-based gaming sector, where fans are highly engaged. According to Vindicia Chief Strategy Officer Trace Galloway "There’s a couple of things driving this. I think in subscriptions services … you’re seeing a lot more titles out there that are very, very popular. As a parent of a teenager who enjoys online gaming with his friends, there are more and more of the kinds of games he wants to play. More and more of his friends find themselves online in these games, and of course, that drives him to want to go there."

There’s no COVID in a role-playing game (unless it’s part of the preprogrammed action), so millions continue flowing into gaming platforms. Long beloved by millennials, gaming subscriptions can get pricey, and PYMNTS data found that 52% of gamers now subscribe to at least one service. That fact is pushing concepts like bundling forward this year.

"If you can get access to multiple [bundled] titles as opposed to going out and spending $50 or $60 per title, why wouldn’t you do that, especially if the experience is the same?" Galloway said.

See also: Microsoft to Buy Activision Blizzard for $75B, CEO Expected to Step Down

Subscriptions and Stickiness

In 2022, data will identify and create new bundles and features to keep consumers engaged with their subscriptions regardless of the health crisis or competing entertainments.

Galloway noted that Vindicia will focus its efforts this year on crunching its own platform data of numerous subscriptions brands to find the bundles with the most consumer stickiness.

"These are merchants that are in different industries, serving to some extent different market segments, but in some cases the same market segment," Galloway said. "And you realize, 'Wait a minute, 73% of the people who have my merchant A subscription also have merchant B subscription, and I’ll bet you A and B have no idea that they have such an overlap in their consumer base.'"

This ability to cross-curate subscription gift box contents from different brands is one area where Vindicia is helping brands and merchants generate better subscriber experiences. Along with popular subscription features like pausing one’s subscription, Galloway said that more subscription platforms would expand feature sets to reduce churn and supercharge retention this year.

"There’s a little bit of gamification that can be applied, there’s the idea of future credits, there’s the idea of promotional discounts for some period,” he said. “It’s going beyond what you would traditionally think of some of the techniques you use in ‘save’ offers."

Data and analytics will power that, particularly as subscription platforms like Vindicia look at usage patterns and become adept at predicting who is in jeopardy of canceling — and get a ‘save’ offer to them fast.

Higher levels of personalization informed by deeper analytics are getting this done. As Galloway told PYMNTS, "There’s different things you can do, and we’ve been trying and working here at Vindicia to expose more and more of what we call our subscription intelligence layer, which is really all about these underlying analytics that look into the big data trends of a business, to a large extent around core billing operations."

Combined with other datasets available under the Amdocs corporate umbrella, Galloway said that for Vindicia, 2022 will be about a subscription billing platform melded with other engagement information — giving the company a more accurate picture of which subscribers are more likely to churn, and allow it to come up with tactics to prevent it.

As personalization and curation become more widespread, subscription commerce will have less and less anxiety about an eventual return to "normal."

Get the report: The Subscription Commerce Tracker

Engagement Shifts as Pandemic Progresses

Subscriptions’ fate is tied to the pandemic to an odd extent, as indoor entertainment — when combined with two years of pandemic remodeling and nesting — makes subscriptions hyper-valuable.

Not willing to speculate on when "post-pandemic" time will begin (if ever), Galloway told PYMNTS, "This trend will continue. You will continue to engage with your entertainment options at home, maybe in not the same quantity that you do today because you find yourself at home far more often, but I think you’ll still keep those entertainment options."

PYMNTS’ research found that 84% of U.S. consumers still engage more with online entertainment options than find entertainment in public spaces, including theaters.

That will continue, regardless of COVID variants and changes, because people discovered they enjoy these services in complete comfort, privacy and safety.

"Am I going to go back to the movie theater if Disney and the other major studios continue to do release at home at the same time they do release in the theaters?" he said. "It’s not necessarily great for the theater, but it is very nice for me as a consumer to be able to watch it in the convenience of my own home. Do I want to pay $25 for it? I don’t know."

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