When a company has a policy that requires all new customers be put on auto-renew at the time of purchase (based on annual use/ contract) they are telling customers: “We do what’s best for us, so there!”
I am mad at the magazine Real Simple because they are following this practice. Their online subscription form forces you into auto renew. I imagine you’d have to call them to get off that program. That is just unkind to customers. Why assume customers want to continue a relationship with you year after year? Yes, I know magazines are in a dying print medium and need recurring revenue, but trapping customers doesn’t create value in the long term. Instead, this practice creates backlash for those who want out or don’t want a never-ending relationship (like me).
Auto renew is also a common tactic for software products. Kudos to Norton Internet Security for offering a kinder alternative. When I recently needed to renew my Norton Internet Security, they at least gave me the opportunity to un-check the box that indicates you want to auto-renew. I’m glad they allow customers to opt out (even though I’m sure many customers could miss that nuance).
Customers want flexibility; can you find one that doesn’t? You are required to allow customers to opt out of your email newsletters, it should apply here too. I say this because angering customers only ends up lowering customer value and creates negative word of mouth. When you consider boxing customers in like this, please consider the long-term damage. For example, if Norton had boxed me in, I would have chosen a competitive product – there are plenty available. And in fact, I still haven’t subscribed to Real Simple because I’m mad about their approach. Maybe I won’t subscribe at all.
Think long-term about customer value – believe it or not, customers are a scarce resource! You don’t want to scare them away for good.
