Blog
/ Research

Ahmed Saleh

2023/08/22

Does account sharing prevention cause churn?

A customer I spoke with recently said: "Account sharing seemed like something we should eventually get around to, but we kept putting it off. We were afraid it would cause churn."

I understand the concern that companies have of losing customers they worked hard to acquire. But why would they leave if companies put a stop to illegal account sharing that's specifically against their policies?

I decided to do a deep dive into the data and see if this concern has merit, or if it's just a feeling to ignore.

Why do some fear account sharing prevention will cause churn?

Looking at this as an active "prevention" is negative framing. So when thinking about preventing users from using a product, the prevention is a negative thing that suggests users will be unhappy and leave.

Many people also fear that when a user is challenged for sharing their account that they will have a negative experience and churn.

Preventing or monetizing account sharing?

If the goal is to simply prevent account sharing, companies can impose harsh limits. For example, allowing only one single active session per account, and requiring users to sign in every new session, and the login is 2FA protected. This would likely remove 90% of account sharing. But it would be a dreadful user experience and likely cause churn due to friction using the product imposed on every user, not just the account sharers.

Therefore account sharing prevention is not the goal, but rather the growth that comes from it is. That's called account sharing monetization.

If companies were able to identify the extra people sharing accounts, and target them with the right messaging to get them to create their own accounts. This would be a much better user experience, and it would also grow companies' revenues and user bases. Rupt is the only product that does this, and puts it on autopilot!

When you reframe as account sharing monetization, account sharing becomes a positive growth channel that should be encouraged.

What does the data say?

We looked at data from 30 customers who use Rupt for account sharing monetization. We'll see the retention rate (in number of months) in the accounts being shared vs the accounts not being shared. Note that the accounts being shared have also seen at least one Rupt challenge (learn more about challenge). The other group never saw a challenge and are unlikely to know that account sharing is even being monetized.

Chart showing the retention period of accounts being shared vs accounts not being shared

Surprisingly, the accounts being shared have a higher retention rate than the accounts not being shared. This is likely because the accounts being shared are more active and engaged. These shared accounts are being shared because the users find the product valuable and are therefore more likely to be retained.

The above data is an aggregate of all 30 companies because it would take a genius chart artist to fit 30 charts in one image (and I'm not one). But the data is consistent across all 30 companies. The accounts being shared have a higher retention rate than the accounts not being shared.

Tips for effective account sharing monetization

We work with many companies to help them monetize account sharing. Some started with concerns about churn, but after seeing the data, they are now excited about account sharing monetization. Here are some tips we learned from working with them:

  1. Start by monitoring account sharing without taking action. Rupt gives companies the option to accurately measure how many accounts are being shared and how many people are using each account.
  2. Set generous rules for account sharing. For example, allow up to 2 people to share an account and up to 3 devices. This will weed out the most egregious account sharing, but still allow most people to share accounts. Rupt allows companies to create a custom configuration for limiting accounts
  3. Slowly tighten the rules over time. We've worked with many companies and can comfortably say that limiting each account to one person results in the highest growth. I've personally seen a customer's conversions double after they switched from a 3 device to a 2 device limit per account. But unless companies are comfortable with that, they can start with generous limits and slowly tighten them over time.

Conclusion

Account sharing prevention is a negative framing that suggests users will be unhappy and leave. But reframing it as account sharing monetization, it becomes a positive growth channel that should be encouraged.

Companies we've worked with have had more retention and engagement from accounts being shared than accounts not being shared.

If you're interested in learning more about account sharing monetization, book a call with us or sign up for a free trial and start monetizing account sharing today.