If you’re reading this, and you rely on a local ISP for internet access, will you please consider sharing? It could help them make it through this difficult time. Thank you.
America’s thousands of local ISPs connect tens of millions of households to the internet. Since our national strategy relies so heavily on the internet in order to work, learn, and receive healthcare from home, local ISPs are vital to our making through the Coronavirus pandemic. Yet many of them will not survive the accompanying economic recession, due to a lethal combo:
- Sudden sharp decline in revenue, from subscriber hardship
- Comparable or increased costs. Their “backhaul” isn’t cheaper; if anything the spike in bandwidth has added to costs. They must pay their crews to keep folks connected, with all-new social distancing precautions slowing down already tedious work.
Ready helps local ISPs grow. That can mean acquiring new subscribers, but far more importantly, it means retaining existing subscribers, and extending the value of services delivered to those subscribers. As COVID19 economic losses deepen, local ISPs are beginning to shoulder a difficult burden.
Local ISPs: here’s one technique you can use to weather the COVID19 storm. In this example, we show the smart collections logic of Ready’s subscription management system, but you can apply the principles no matter what tools you’re using.
This technique applies the following principles:
- Above all, stay safe out there. Help your subscribers do the same.
- Balance profitability with compassion.
- Believe in a near-future recovery, and help make it happen by staying alive.
Two statements are equally true:
- On the other side of every delinquent account sits a family of human beings who depend on the internet.
- You run a business, not a charity, you need cash flow to stay in business.
So … what would you do if a major portion of your subscribers haven’t paid you for months? That’s a scary question, and seems like a no-win scenario, but here’s a win-win solution:
Offer “use-anytime” payment credits in exchange for long term contract signups.
Put another way, trade a portion of today’s Monthly Recurring Revenue (MRR) for Total Contract Value (TCV). You “invest” a few months worth of deferred MRR into a long-dated boost to your TCV.
Since Ready gives you all the tools you need to implement this strategy, you can schedule a demo as a free consultation. Or keep reading the steps below to implement on your own.
Grow Smarter. Faster. Stronger.
Ready’s all-in-one platform for growing ISPs makes it easy to manage subscriptions, accept online payments, and offer long-term contract plans to subscribers. Learn how Ready can help you grow. Request a demo today.
Step 1: Evaluate Your Situation
If you saw a double digit spike in your accounts aging last month, you’re not alone. And our guess is you’re not looking at the last of them. It will almost certainly get worse before it gets better. What if half of your accounts fall delinquent in the coming months?
Step 2: Plan Your Offer
Work out the MRR you need to survive. From this, you’ll calculate an offer that helps your subscribers and you. The goal is to offer a few months worth of “use anytime” credits in exchange for longer term contract signups.
Focus on required survival MRR, since if you do this right, it will very easy to more than make up for the foregone revenue in absolute dollars, as you’re effectively investing a few months of otherwise late payments into a few years worth of contracted revenue. You may even be able to furnish a discount for extended periods, and cross-sell additional services to end up ahead.
Decide what contract durations, discount levels, and bundles work best for your business. Here’s an example:
Three months of use-anytime credits in exchange for 2 year contract at 100% plan price, OR 4 months of use-anytime credits in exchange for 3 year contract at 75% of contract price.
To enhance the economics, and make the offer more valuable to your subscribers, consider upsells and cross-sells you can use to further monetize the contracted subscriptions.
Here’s an example:
Add another month of use-anytime credit in exchange for 1 year of Upgraded Plan.
If you’re like most local ISPs, your residential subscriber base is month-to-month (even though every national incumbent utilizes contracts for residential service). Ready’s subscription management system makes it easy to configure, offer, and enforce subscription contract plans, including credits. Learn more here.
Step 3: Make The Offer
Let all of your subscribers know you care, and present the offer. If they’re late on internet payment, they may be worried about what you’re going to do.
🔑: Announce your offer to all subscribers know at once.
Announce your offer to all subscribers, not just currently delinquent accounts, since:
- The problem may deepen next month.
- You never know who is paying you their last dollar for fear you’ll turn them off, when they could be using that money for something urgent.
- If you did the offer math correctly, the unit economics of your offer are net positive to your long term growth, so, the more subscribers who take your deal, the stronger you’ll emerge on the other side.
- Word of your offer may spread. Offering to all subscribers is a great way to be consistent and transparent.
- Subscribers not struggling to make payments may appreciate the offer and think of the good you’re doing in the community in their future decisions.
🔑 : Make it a (mostly chatbot) conversation.
Now is the time to engage in conversation with large numbers of subscribers. You need to go beyond emailing a link for this technique to land, in order to discuss the situation with the portion of your subscribers who need to work out details with you. Your message is “Talk to us. We’re here for you.” But having hundreds or potentially thousands of conversations isn’t feasible without help from tech.
Thankfully, there’s a bot for that. Use chatbots to automate the start of your conversations, routing special cases to your busy subscriber happiness team.
Ready’s all-in-one ISP subscriber management system integrates with FreshChat and Hubspot for website messaging. Both offer easy to integrate chat bots. Configure a special topic to trigger your COVID19 offer flow.
Here’s an example configuration, inspired by one of our customers:
- Respects each subscriber’s privacy and situation
- Makes it clear to delinquent subscribers that action is required, with an easy path to win-win
- Gives the subscriber ample time to remedy the situation
- Avoids the heartache of absolute shutoff during extreme crisis
Here’s what it looks like implemented:
🔑: Make it easy to accept and administer the offer.
- The chatbot’s job is to route subscribers to the offer page while keeping a potential line of communication open for further conversation with a human member of your team. Link your chatbot to your deferred payment service subscription offer page.
- If the subscriber raises additional questions or issues, or wants to discuss alternatives with you, you’ll get alerted and can engage accordingly.
- For subscribers who accept your offer, keep service intact
- For subscribers who go delinquent without accepting, offer a graceful downgrade path to 1/1 “lifeline” bare connection – this avoids complete service disruption, but halts bandwidth-intensive entertainment uses like Netflix
- For subscribers who have a special situation, and cannot or will not accept your offer, you can engage in a conversation, then decide what to do on a case by case basis
Ready’s subscriber self-serve signup system integrates directly into your existing website, making it a breeze to set up the offer landing page.
Ready’s subscription management system integrates with a wide range of provisioning systems, making it easy to auto-provision based on the account payment status logic you configure.
Use this method to turn lemons into lemonade. From crises emerge seeds of opportunity for tomorrow’s strongest businesses.
Ready is purpose-built to make smart collections routing as painless as possible for your ISP subscription management. Schedule a demo to learn how Ready can help you survive and thrive.
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