Klaus Miller

Who they are

This page records only what the working paper states about its authors. Biography beyond that is not given here.

Key papers

Sophisticated consumers with inertia (working paper; version of January 2023). A large European daily newspaper, which asked to remain anonymous, randomised the trial offers shown to new readers who hit its digital paywall between April and August 2018, and the researchers followed them until April 2020. In the version of January 2023, 2,092,861 readers took part. Offers varied in three ways: the trial lasted two or four weeks, it was free or cost 99 euro cents, and it either rolled into a paid subscription unless cancelled or ended unless the reader chose to continue.

Roughly half of the readers who took an auto-renewing trial went on to a full-price subscription. But readers anticipated the arrangement: between 24 and 36 per cent of potential subscribers avoided subscribing in the first weeks after an auto-renewal offer, and over the following two years the share of subscribers was about 10 per cent lower under auto-renewal. Auto-renewal earned more in the short term, and after a year the two contract types brought in about the same revenue. The authors estimated that about half of readers were inert and that at most 41 per cent of the inert readers were unaware of their own inertia. Later presentations of the work report revised figures, so the numbers here are tied to the January 2023 version.

Key ideas

The study shows two things at once. Inertia is real and valuable to a seller, since many people keep paying once a subscription renews by default. Yet many customers see the trap coming and stay away, which limits how much a firm gains from it over time. That makes the case against cancellation friction less about naive customers and more about the people whose attention runs out.

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