Archive | August, 2012

Why Churn is a Problem for Digital Media

At what point does churn rate inhibit growth and profit in a digital media business model?  Both in the information services and SaaS industries, a churn rate over twenty percent is problematic for the business model. In both of these industries, sustainable profits exist at around ten percent churn. In controlled circulation of print media, a twenty percent churn rate would have been difficult to sustain. In digital media, the lifetime value of audience members is a key success factor to creating a profitable business model. This research note begins to explore the dynamics of the lifetime value of a digital audience. In September of 2011, Scout Research began tracking several audiences on B2B publisher sites to understand the lifetime value of the […]