Yet, historically, companies haven’t understood how to manage churn.
For example, most don’t realize that there’s a key difference between voluntary and involuntary churn – the former being a customer service problem, and the latter being a card decline problem.
While I won’t address how to solve credit card decline problems in this post (I’ll do that later this week), I’ll offer a few pieces of insight on how best to service customers who are on the fence of canceling.
Saving a sale starts with ‘incentives’ – namely, incentives that are in the interest of the CUSTOMER, not the company.
Good incentives help reduce subscriber churn by roughly ~30%/year.
Here are some effective tactics, ranked most important to least
Most important:
- Re-iteration of value proposition (I/e: Why and how the subscription is of value to them) — >> If your CS team can’t explain this in 5 seconds or less, you’re done.
And,…
- Discount(s)
- Account credit(s)
- Plan downgrade to lower price tier
- Subscription ‘pause’/ hold/ skipped payment
- Additional benefit(s)
- Free product