Posted by: Mark Upson

So when and where should you do the deep dive?  Demand Rating™ and Demand Ranking™ offer insights to determine when and where analysis is warranted.

Evaluating the range on Demand Ratings, the difference between the high and low, provides a uniformity measure of subscriber loyalty.  In general, the tighter the range, the more uniform the subscriber loyalty is, and the more uniform the loyalty the less time should be spent comparing subscribers to each other. 

Outliers, however, can throw a wrench into the works by creating a big range and potentially raising unnecessary analysis.  Demand Rankings increase the accuracy of a range by filtering which Demand Ratings should be included.  Within a subscriber segment, the Demand Rating with a rank of 1.0 should be the high, and the Demand Rating with a rank of -1.0 should be the low.  Using these two ratings to create a calibrated range eliminates the outliers that are not representative of the subscriber base in general.  The calibrated range can be assessed on uniformity and the need for further analysis.  

So what do you do with the outliers?  As you can imagine, outliers prove to be an important source of clues to loyalty drivers.  Much like the previously mentioned cluster analysis for high ranking and low ranking subscribers, outliers can be compared to the segment in general to identify additional loyalty drivers.

Demand Ranking extends the power of Demand Ratings.  Whereas Demand Rating gives you a measure of subscriber loyalty, Demand Ranking lets you understand the drivers behind subscriber loyalty. 

Closing out the series on Demand Rating and Rankings it is important to underscore the importance of firmographics.  Firmographics provide the basis for tracking behavior needed in ratings and for segmentation needed by rankings.  In the next blog series, Pete will examine the challenges and strategies to accurate firmographics.

Demand Ranking, Demand Rating, Firmographics, Subscriptions Demand Ranking, Demand Rating, Firmographics, Subscriptions

Posted by: Mark Upson

Last time, we talked about how Demand Ranking is a statistical method for grouping subscribers based on their Demand Ratings, so let’s take a little deeper dive. Because Demand Ranking gives us a new dimension for comparing and understanding subscribers, it can be correlated with all sorts of firmographic and usage attributes to gain new understanding into loyalty drivers.  The visualization of the two dimensions looks something like this where the horizontal axis is the Demand Ranking and the vertical axis is a firmographic or usage attribute:

If loyalty is not correlated to a particular firmographic or usage attribute, the visualization looks similar to this:

If loyalty is correlated to an attribute, the visualization would look more like the following:

When charted against usage attributes such as topic, frequency, denial and license patterns, Demand Ranking can uncover issues and opportunities that can be addressed through account management.  For instance, low ranking groups might not be taking advantage of content used by high ranking groups.  In this case, account management can be leveraged to promote the availability of more relevant content that can boost subscriber loyalty. 

When correlated with firmographic information such as geography, industry and company size, it can spotlight issues and opportunities associated with the product itself.  For instance, a global organization might see a normal distribution of rankings when correlated against license use, but when correlated against geography, might identify a dramatic issue in one particular country that requires product changes.

Utilizing Demand Ranking as a new ordinal for analysis enables specific issues and opportunities to be visualized and acted upon– all the way down to the specific subscriber level.  Training sessions might be put in place for Subscriber A, while license terms might be offered to Subscriber B.  A new sales policy might be put into effect for a specific geography, or content or product sets might be refined.  Best of all, the effectiveness of the efforts can be measured and clearly quantified.

Behavioral Analytics, Demand Ranking, Firmographics, Subscriptions Behavioral Analytics, Demand Ranking, Firmographics, Subscriptions

Posted by: Mark Upson

Like any CEO worth his salt, I look for ways to better understand which prospects and customers are my best sources of revenue.  I’m constantly concerned with understanding the drivers of loyalty.   In a subscription business, this job is extra tricky.  Because of the decoupled nature of purchase and fulfillment, subscriber loyalty can change and adjust over time due to many factors—without an immediate effect on revenue. 

So how do you get more insight into loyalty drivers?  The answer is Demand Ranking™, a statistical qualification of Demand Rating™. While Demand Rating creates the ability to compare demand between customers over time, Demand Ranking enables you to discover the drivers behind subscriber loyalty.  Demand Ranking is a quality score that tells you whether a Demand Rating is high or low.  Essentially, Demand Ranking tells you whether a subscriber’s demand rating is good or bad in terms of future revenue potential from that subscriber.

At the simplest level, ranking paints a picture of subscriber distribution using demand rating.  Demand Ranking is derived from a z-score, a statistical calculation, of each demand rating.  Those subscribers with a negative rank have low demand rating and indicate risk.  Those with a positive rank have a high demand rating and indicate revenue growth opportunities.

It is this statistical grouping that can provide P&L owners of recurring revenue businesses powerful new insights.  By examining Demand Rankings based on different aspects of the business (e.g., demographics, usage, and spend), it becomes apparent what the drivers to loyalty are, enabling the P&L owner to better understand and direct revenue generation initiatives.

Behavioral Analytics, Demand Ranking, Subscriptions Behavioral Analytics, Demand Ranking, Subscritptions