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Subscription boom: Lockdown subscribers to boost long-term customer retention, new study reveals

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Subscription boom: Lockdown subscribers to boost long-term customer retention, new study reveals 1
  • 37% British adults signed up to at least one new subscription service in lockdown
  • 3 out of 4 consumers intend to continue their subscriptions post-lockdown
  • Five key audiences identified for subscription brands

New research by independent media agency The Kite Factory and YouGov finds almost 2 in 5 (37 percent) UK consumers signed up to at least one new subscription service during lockdown (since 23rd March 2020). And the prolonged lockdown measures are driving consumer loyalty with nearly three quarters of new subscribers (72%) likely to continue. According to YouGov, consumers who are signed up to physical subscription boxes jumped from 7.9m to 8.2m (+3.3%) from Feb to Oct 2020. The largest growth was in those over 55 up 74% from 590k to 1 million. The nationally representative survey of 2,141 consumers revealed that video streaming services were most popular across all demographics with three in five consumers signing-up to a new video streaming service since lockdown.

Noticeable differences in purchasing behaviours were identified between generations with 18-24s the most likely to sign up to a music streaming service (41 percent) and 25-34s twice as likely to sign up to fitness, health and wellbeing services. Newspapers and magazines proved most popular with over 55s. Those who signed up to magazines and music streaming services were much more likely to continue subscribing than those that signed up to services such as food & drink boxes or education services such as online language schools. And pet owners who love the newfound convenience of pet food subscription services resulted in none of them (0%) saying they would be very likely to cancel in the next six months.

James Smith, Managing Director, The Kite Factory said: “These findings are hugely encouraging for brands already offering subscription services and may offer hope to those that are considering it. The second lockdown will be another huge challenge for the retail and hospitality sectors but offering a subscription service could help mitigate losses by tapping into these audiences engaging in subscription culture. Our new insight into the different subscriber attitudes will help brands looking to dip their toe into subscription services better identify how best to reach them.”

The study identified five key subscription audiences:

Tech Savvy researchers:

Consisting of late millennials and early Gen-X, 46 percent are between 25 to 44 and over index for women aged 35-44. This group see technology as a benefit to the way they live and are often early adopters of new technology services and apps.

  • 11 percent signed up to an education service in lockdown and 61 percent signed up to an online video streaming service, both possibly linked to children staying home from school.
  • 42 percent say it is very likely they will continue subscribing in the next six months.

Subscription stackers:

A younger, male audience aged 25-44, over indexing for males aged 25-34. Many are pre-family (70 percent without children) and household incomes average at around £40,000 a year. Two thirds prefer to buy things online rather than in-store and two in five are willing to pay more for luxury brands. This group are more into gaming and technology than sports. Many admit struggling to manage their personal finances and are likely to buy things on impulse. They’re comfortable living in minor debt. Many added one or two subscription services to their existing list with self-improvement on their agenda.

  • Eight percent signed up to educational and self-help services.
  • 40 percent say it is very likely they will keep subscribing over the next six months.

Subscription switchers:

A female audience living in middle income households predominantly outside of city centres. They value meaningful brands over luxury, and many signed up to several subscriptions in lockdown.

  • One in ten signed up to pet subscription products
  • 22 percent signed up to a new magazine subscription
  • This demographic is the most likely to say they will remain subscribed to their lockdown subscription for the next six months.

Financial Trackers:

The oldest demographic with 44 percent over 55 and 29 percent currently retired (although there are also a portion of full-time students that fall into this attitudinal segment). Most consider themselves financially secure and nearly all have a wary outlook on fraud – 97 percent regularly check their bank and credit card statements for suspicious activity. This group will switch brands for speed and convenience, and they are happy to pay more for good quality. They trialled food and drink boxes during lockdown and one in five signed up to a new magazine subscription.

  • The least loyal audience, six percent have already cancelled their lockdown subscription and a further five percent say it is very unlikely they will continue subscribing over the next six months.

Offer seekers:

This audience are looking for a short-term offer and will cancel any ongoing payments at full price. Made up of individuals with lower household incomes including students and low-income families, this audience is most likely to sign up to food and drink boxes such as Oddbox or Naked wines, music streaming, beauty, or grooming products. This audience signed up to the greatest number of subscriptions of all audiences and are hard to avoid for brands promoting free trials or discounts as they pride themselves on their ability to seek out offers online.

  • Two in three (68 percent said they would continue subscribing to their lockdown subscription over the next six months.

Business

Can a leader’s level of enthusiasm and optimism really impact the bottom line?

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Can a leader’s level of enthusiasm and optimism really impact the bottom line? 2

By Mark E. Brouker, Captain, United States Navy, founder of Brouker Leadership Solutions

Can a leader’s level of enthusiasm and optimism really impact the bottom line? We hear of the leader’s ability to influence others in powerful ways in politics, academia, sports, among other areas. However, in business, profitability is where the rubber meets the road.  How impactful is the leader’s level of enthusiasm and optimism in creating a healthy bottom line?

One of the truly remarkable and rewarding tours of duty I had during my Navy career was with a small group of highly motivated doctors and pharmacists from all three services – Army, Navy, and Air Force. These professionals were all hand-picked to join a newly-formed team which was directed to reduce the escalating cost of prescription medications provided for all Department of Defense (DoD) active duty (Army, Navy and Air Force) and family members. Our task was made more challenging because we were to reduce costs without decreasing quality of care. At that time, there were over eight million men, women, and children eligible for prescription medications throughout DoD. The annual cost was over five billion dollars and climbing fast.

Our boss, Dan, was a brilliant, hard-working, and extremely passionate leader who was highly respected by all. Dan cared for us and we cared for him. We were a tight group. We treated each other as family. Dan’s passion was contagious, and he quickly established a culture of caring, hard work and trust. We were poised for success. Because I was senior to other members of the team, Dan selected me to be his deputy.

The idea of creating a small team to bend the cost curve for the entire DoD pharmacy benefit was novel – it had never been tried before. While the team shared a genuine passion for this noble and ambitious undertaking, early wins were few and far between.

After the 6-month honeymoon period ended, enthusiasm was slowly replaced with frustration.  Every morning we’d meet with Dan to share the progress or, more accurately, lack of progress with our respective projects. It was slow and insidious at first, but sarcasm, frustration and pessimism crept into the meetings. A few of the more vocal naysayers would spew their negative venom and Dan and I would make meager attempts to mitigate the damage, or in times of weakness simply join in. These meetings frequently went much longer than scheduled, drained everyone of energy, and were generally recognized to be a waste of time. In short, neither Dan nor I led these meetings. We attended them. One could feel the energy, passion and trust dissipate like air leaking from a balloon.

Mark E. Brouker

Mark E. Brouker

It was clear that Dan and I needed to change our attitudes. We candidly discussed the culture of pessimism that we were creating and, more importantly, how it was sucking trust and the creative juices from the team. Over a handshake, we agreed to help each other curb our negativity and celebrate small victories that were indeed happening. We’d address the challenges, but not mire in them. We agreed to not let anyone hijack the meeting with their negativity.

We were more careful in the words we chose – we rid ourselves of cynical remarks. We were careful with our body language. No scowling or worried looks. Above all, we focused on staying positive. We’d invest a few minutes before meetings to reflect on past successes, however minor, and mention them at the beginning of the meeting. We’d then address the challenges, and close each meeting with a reminder, once again, of past successes.

Frustration and pessimism were slowly replaced with enthusiasm and optimism. Wins starting coming. More wins followed. Within 2 years, our small team was saving DoD over $100 million annually with no reduction in quality. Our small team was recognized within the industry as a center of excellence. Our success was nothing less than stunning.

How did this happen? It turns out that Dan’s and my behaviors had a much more profound impact on our team members than we could have ever imagined. In fact, studies have shown that the leader’s level of enthusiasm and optimism directly impacts their team members level of enthusiasm and optimism. Why is this the case? A study by Gallup found that employees who are supervised by highly enthusiastic leaders are 59 percent more likely to be enthusiastic than those supervised by unenthusiastic leaders.[1] In other words, the leader’s behaviors, in this case optimism and enthusiasm, are contagious. Further, studies have indeed shown that businesses led by enthusiastic and optimistic leaders were significantly more profitable than those led by apathetic and pessimistic leaders. [2] [3]

Can a leader’s level of enthusiasm and optimism really impact the bottom line? Unquestionably the answer is yes. The leader’s ability to influence in politics, academia, sports and yes, profitability in business, is profound. Those businesses led by leaders who understand, respect, and embrace the strong correlation between the leader’s level of enthusiasm and optimism as it relates to performance and profits – and most importantly practice these behaviors – are at a distinct competitive advantage.

Be a great leader – lead with enthusiasm and optimism.

Mark E. Brouker, Captain, United States Navy (retired), Pharm.D., MBA, FACHE, BCPS, is founder of Brouker Leadership Solutions, and author of Lessons From The Navy: How To Earn Trust, Lead Teams, And Achieve Organizational Excellence. For more information visit http://www.broukerleadershipsolutions.com/.

[1] Gallup, “State of the American Workplace, 2017.” Accessed February 12,2020.

[2] Michael Bush, A Great Place to Work for All (Oakland, CA: Berrett-Koehler, 2018), 26

[3] Marcus Buckingham, First, Break All the Rules (New York, NY: Simon and Schuster, 1999), 40

 

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JPMorgan to launch UK consumer bank within months

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JPMorgan to launch UK consumer bank within months 3

LONDON (Reuters) – JPMorgan Chase & Co will launch a digital consumer bank in Britain under its Chase brand within months, the U.S. banking giant said on Wednesday.

The bank said the new business had already recruited 400 people and would offer a range of products, including current accounts.

The UK venture will be led by Sanoke Viswanathan, who has been named chief executive. Viswanathan was previously chief administrative officer for JPMorgan’s corporate and investment bank.

The digital bank will be headquartered in London’s Canary Wharf financial district, with customers supported from a new call centre in Edinburgh.

Reports about a likely tilt by JPMorgan at the UK consumer market have been circulating for around a year, but the bank had publicly disclosed few details.

“The UK has a vibrant and highly competitive consumer banking marketplace, which is why we’ve designed the bank from scratch to specifically meet the needs of customers here,” said Gordon Smith, CEO of consumer and community banking for JPMorgan.

(Reporting by Iain Withers; Editing by Jan Harvey)

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European regulator clears Boeing 737 MAX airliner for return to service

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European regulator clears Boeing 737 MAX airliner for return to service 4

(Reuters) – Boeing Co’s modified 737 MAX airliner is safe to return to service in Europe, the European Union Aviation Safety Agency (EASA) said on Wednesday, lifting a 22-month flight ban after two crashes of the jet which caused 346 deaths.

EASA Executive Director Patrick Ky said it had “every confidence” that the plane was safe following an independent European review of changes ranging from cockpit software to maintenance checks and pilot training.

“Let me be quite clear that this journey does not end here,” Ky said in a statement.

“We have every confidence that the aircraft is safe, which is the precondition for giving our approval. But we will continue to monitor 737 MAX operations closely as the aircraft resumes service.”

Regulators around the world grounded the MAX in March 2019, after the crash of an Ethiopian Airlines jet five months after one flown by Indonesia’s Lion Air plunged into the Java Sea. A total of 346 passengers and crew members were killed in the two crashes.

The United States lifted its ban in November, followed by Brazil and Canada. China, which was first to ban the plane after the second crash, and which represents a quarter of MAX sales, has not said when it will act.

Relatives of some crash victims have strongly criticised the move the clear Boeing’s best-selling airplane.

EASA represents 31 mainly EU nations, excluding Britain which formally left the bloc this month. Britain is expected to issue its own separate approval on Wednesday.

(Reporting by Sudip Kar-Gupta, Rachit Vats; editing by Jason Neely)

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