Break point in the Internet Business World


I read a great post by Seth Godin today that was a quick discussion on "Breakage".

He related the breaking point to rising insurance costs (you know the ones… health and automotive that continue to increase well beyond inflation regardless of whether or not you have even dipped into their reserves).

At what point does one say ENOUGH! and switch to another service, where presumably the same cycle will repeat itself.

The insurance companies are juggling the trade off between the extra revenue they collect system wide relative to account attrition.  As I look at Blue Cross Blue Shield’s profit statement of over 100 million (not bad for a "nonprofit") I say they are balancing things just fine.

Now let’s take breakage in a different direction and look at online businesses.

The breaking point that I often see pushed is in the realm of email marketing and list ownership.  I have heard more than one successful list owner admit that once they get a name on their list they will hit them pretty darned unmercifully until they either convert to a customer or unsubscribe.  If they leave without buying then they weren’t worth having on the list.


The lead funnel for that type of business model must be huge.  It is also probably a safe assumption that most names on the lists are there in response to freebie, opportunity seeker type offers.  Not exactly the model customer prospects. 

Now, what if that breaking point were to be skewed just a little?

What if the attitudes and the messages were changed so the folks on the list felt they had a real relationship with the list owner.  What if the content they received in most mailings was so good that they were afraid to leave the list for fear of missing out on something.  Consider that a small change in the messages being sent out could sway 1-10% of the people normally heading back out the door.  Could that translate into a lot more customer conversions, even repeat customer conversions, with roughly the same amount of work.

I say, change the attitude and the income will follow.  You do not have to PUSH people to the breaking point, just lead them to drink your water.

The biggest problem with stretching a rubber band until it breaks is when it snaps back and smacks you in the hand.

Onward & Upward!

Sam Knoll

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