Thursday, May 22, 2008

The Nudge

Dan and Chip Heath write a great article in the May issue of Fast Company. It is about changing people's opinions with just a small nudge, or change in the way things are normally done. One example they give is that in Austria, you are automatically an organ donor unless you opt out. Therefore, 99% of residents are donors. When you have to opt in, only 12% of residents of Germany are donors.

Could you make renewals automatic? Once you sign up, we will automatically charge your credit card each year unless you opt out? Are there laws against that? Would you get a big backlash? I know credit card companies try to do that with their "insurance" plans in you lose your job, etc.


David M. Patt, CAE said...

Yes, you need to check the legalities of that.

By the way, I don't select automatic renewals when I sign up for anything. When the term is up I want to be asked again.

I think opt-out is presumtuous and takes advantage of people who are either uninformed or inattentive.

You don't have to persuade people to renew when their membership expires, simply inform them it is time to renew.

Matt Baehr said...

Actually, I am with you David. I just wanted to throw it out there.

However, even though it may take advantage of the uninformed, those may become informed by being automatically renewed.

Scott Oser said...


When I was working in the publishing world for a number of years credit card automatic renewal was the panacea. Every publisher in the world thought people would flock to it and it would make the world a better place. As we all tested it no one was real successful. There were numerous issues including lower response, bad credit cards, etc, etc. Bottom line was I don't think that people wanted you to sit on their credit card info and just zap them over and over again.

What many companies went to was what we call automatic billing. It is really semantics but what publishers were doing was getting subscribers to sign up for an auto bill program. What this meant is that you were giving written consent (not legally enforceable of course)that you were going to renew for the foreseeable future and that the publisher could invoice you and expect payment. Instead of sending a "renewal" to you they would send a "bill" to you stating that you had signed up for this program and your payment was now due. It did work in some cases and their are several publishers that are now using it as part of their regular process.

Personally I think that associations are different than publishers. Associations need to show their members the value of membership on a consistent basis so that renewal is a no-brainer. If all were able to do that we wouldn't have to worry about hoping that some folks gave us credit card numbers that we could just hit regularly and hope that even some of those that wanted to drop their membership were just too lazy to figure out how to get us to stop charging their cards.