Signal to Noise

I’ve noticed an interesting trend. Subscription-based services tend to be more expensive for existing customers than they are for new or returning customers. This was borne out in three ways for me recently. First, about a year ago I cancelled my World of Warcraft subscription. Sorry, the whole Reality Thing just made WoW a personal waste of time for me. But I started receiving really appealing offers from Blizzard to re-up, the most recent of which arrived in my mailbox: a copy of the Burning Crusade expansion on DVD along with a block of free playtime.

Second, I tried out an online dating site for a social networking white paper I’ve been working on (OK so maybe I went to a few dinners, too). After I concluded my inquiries, I cancelled the subscription to the dating site. After cancellation, I got a re-up offer at 20% off the original fee. Then, a few weeks later, I got a re-up offer at 35% off. Now, I’m up to 50% off. Maybe I should just keep waiting until it’s totally free.

Then there’s the whole new customer service bundle thing that the MSOs and telcos are doing. Want cheaper broadband access? Cancel your subscription for a month, say you went to a competitor, and then let the original service provider “win” you back at $20/month for a year. Sure it’s dirty, but no dirtier than charging happy customers more than available customers.

The lesson?  Prospective revenue is more valuable to these guys than current revenue.