Pay sites offerring HUGE discounts for unhappy members...
 

We've been reviewing pay sites of all types in the last year, and one of the trends we've seen are sites that go from $40/mo memberships to offering a discount of 75% ($9.95/mo) when a member cancels, in order to desparately squeeze every last penny out of the individual.

For business purposes, this is obviously a good strategy... but at what cost? This method is clearly saying "hey, since you were smart enough not to be scammed into paying $40, and it costs us almost nothing to provide this service, how about we reason at $10?"...

In my opinion, this method of business is weak, and if I were a loyal member who did pay $40/mo only to know later that I could of paid $10, I'd be pissed!! Isn't this the WRONG way of treating loyal members?

Appreciate any feedback...

dejavu?

Yeah I posted this originally yesterday, but it got deleted an hour later during the server move... so hopefully we'll get some more opinions. :thumbsup

On the other side, you have quality sites that offer loyalty discounts to members who stay longer than 1 month. They are building relationships with members, pro-active about customer service, message boards where their users can complain or give suggestions.

Also, from a webmaster point of view, what's the etiquette? I'd love to advertise to my surfers this "little secret" to my users... but I'm thinking this isn't something they would want disclosed. I'm sure newsgroups/forums have already uncovered this to savvy users, but would webmaster programs (who use this practice) ban their affiliates for advertising this? Why shouldn't we show our surfers how to take advantage of the best deal possible?

Here's an example of what I'm talking about:
http://www.clients-support.com/cancel2.html

they are considered "loyal members" after a certain period of time (3 months in my case) and only then can they qualify for the discounted price.

i agree with you, but few in this business has ever given two shits about long term relationships with the buying public. God knows how millions of surfers we turned into confirmed lifetime freeloaders.

and you would be turfed out of any affiliate program for marketing that there is a cheaper secret deal that pops up on exit or whatever. that's fair - you can't expect them to pay you $30 per signup on that kind of marketing, they'd lose money.

Well, this of course depends on the pay site. I know a pay-site that charges $29.95 first month, then recurs at $9.95/mo after. It's besides the point what is considered "loyal". Point is, you have sites looking to reward loyalty (which is great), and other sites charging 4x MORE to loyal members.

Good question. Since we are talking about commercial sites seeking to maximize their profits I don't think it's a weak business, just business. A different linking code very often determines the price of a product and it's up to the affiliate or the program/service owner to choise it. From his side, he tries to make the most from his traffic. It's a frequently used strategy/method because it works. I dont find anything wrong on this.

What if I wasn't the one marketing this secret? What if I had a forum where my users were advertising this? I shouldn't have to delete that post, just because the program might not make money. They choose their business model, not me.

The way I see it, is that all programs should base final payout on member retention, if it's unsatisfactory... or at least have a backup program where the webmaster can take 50-60% recurring if performance is low. I don't mind taking less money, and we should be able to disclose the truth to our users! Don't ya think?

This isn't true. There are lots of programs (Huster, Vivid), who do offer discounted memberships... that's not what I'm talking about. I'm talking about pay-sites (w/programs) offering discounts when they try to cancel. This isn't an option in any webmaster program... it's just a practice large programs do (not all, but some). I have no problem with the business side of it.

BUT, as a webmaster who runs a site aimed earning the trust of my audience, shouldn't I have the right to disclose this info without being canned? If I keep my mouth shut, then my users will question my intentions.

p.s. I have yet to advertise this to my users, and am worried I'd get terminated if I did.

I get a tons of people that join my sites for a couple months then cancel then in a month they join agin for a couple months. I think having the cancel discount is a very bad move.
The returning surfers know that they can just go halfway through the cancellation process and get a cheap membership..that sucks..i would never do that

We have that very setup loyalty discount for our members.... ie www.TNVGirls.com

Well, you're getting paid per signup and you've already been paid...so the site wants to maximize that member, if it means saving a member to give them a discount, what's wrong with that? God forbid a site should make a proift, huh? Advertising that would be stupid, it would make that surfer worth less money.

Why should you have the RIGHT to disclose anything? The surfer is not YOUR customer, the surfer (once they sign up) is the site's customer. The paysite is YOUR customer.

There's always been 2 sides of this business:

1. Sites looking to provide a great product, and retain users for a reasonable price.

2. Sites looking to mass market their mediocre product, convert users from a cheap trial to an overpriced monthly fee, not worry about retention, and hopefully cash out for slightly more than option #1.

Option #2 has been the flagship business model of this industry since the beginning. I think FINALLY things are turning the other way, or will soon. Am I way off base?

Business is business, of course... but I expect these sites to LOSE business when users become more savvy. I wouldn't advertise this if it meant getting terminated from a program, but there's not much I can do if my users post it in our forums (coming soon).

Why shouldn't I have the right? I'm not saying I would deserve the same amount of commission... Even if I get nothing in return, I should have every right to disclose legal ways for my users to save money. Ever heard of techbargains.com?