Customer retention is one of the most pressing matters for every business. This is especially true for subscription services that charge customers a recurring fee. Customers cancel their subscriptions for a variety of reasons. And if you don’t understand why customers leave and how to retain them, you’ll quickly lose customers and revenues.

A large number of customers canceling your subscription service creates high churn rates which definitely harm your business. So in this article, we will share how to decrease subscription churn rate. Hope that these tips are helpful for your business. 

What is the churn rate?

The churn rate is the number of customers who cancel or do not renew their subscriptions during a given time period. According to McKinsey, almost 40% of e-commerce subscribers have canceled their subscriptions. And more than one-third of them stop service in less than 3 months. A high churn rate can damage Monthly Recurring Revenue (MRR) and reflect customer dissatisfaction with a product or service.

decrease subscription churn rate

In subscription businesses, churn rate is a critical metric that influences product pricing, lifetime value, and customer acquisition cost ratio, etc. While a zero-churn rate is desirable, you should maintain a churn rate of less than 10% in the long run.

Why do churns occur? 

Churns can be voluntary and involuntary. When a subscriber does not find value in the service, he or she will churn. This voluntary churn can occur for a variety of reasons, such as the customer no longer requiring the service due to a change in circumstances. 

When a customer leaves a subscription without making a conscious decision, this is referred to as involuntary churn. Again, there could be a variety of causes, the most common of which is payment and transaction-related. Customer satisfaction can be affected as a result of involuntary churn. Customers will be confused if they are unaware that their payment has failed and are unable to access your product or service. This is a recipe for dissatisfaction, and it may even increase voluntary churn.

How to decrease subscription churn rate

Identify the common reasons why it occurs

Before you can take actions to reduce subscription churn, you must first understand why subscribers churn. If customers are leaving because the price is too high, for example, you should reconsider your pricing strategy. Check your release schedule if outdated content is the issue. Keeping subscriber data up to date can also help you detect churn patterns so you can address them before they hit the “unsubscribe” button.

Whatever the reason for churn, a subscription company must be on the lookout for it. It’s a good idea to ask each customer why they’re canceling their subscription. While a low churn rate is normal, if you have a high churn rate for an extended period of time, something is seriously wrong. You must assess the current situation with the utmost care and priority.

Ask for feedback and engage with your customers 

Ensure that you are consistently seeking feedback at key points to improve the customer experience. If you’ve already defined that customers are likely to churn if they don’t log into your tool every 15 days, ask for feedback from them around day 10 and try to re-engage them.

ask for feedback to decrease subscription churn rate

Build a good relationship with your customers by engaging with them on a regular basis so that they see you as a reliable partner. Plus, reach out via email marketing with information you believe they’ll find interesting. Besides, you can engage with them on social media and prompt reply to them if they need any help. 

Keep content up to date

It is critical to release content on a regular basis so that your channel remains fresh and reminds subscribers why they pay for your service. Providing new content creates interest and excites your audience no matter what industry you’re in. However, in some industries, consistent uploads are required to retain subscribers.

Moreover, you can provide your customers with helpful tips and guides as a method to retain them. For example, you can release posts about how to use your products and keep customers educated with high-quality content relating to your industry. Besides, building a community where you can keep in touch with your subscribers and share useful content will make your customers feel trustworthy and stay with your service longer. 

Reward subscribers for their loyalty

Promotion coupons have long been a popular approach to persuade new subscribers to join your subscription service. You can now utilize promotions to keep and reward your existing subscribers as well. Here are some suggestions:

  • Provide a discount to subscribers who are on the verge of leaving.
  • Reward customers that refer friends to your subscription box service
  • On their one-year subscription anniversaries, send promo codes to subscribers.

Win back your subscribers who cancel

The first and automated method that you can apply to win back your unsubscribers is creating an exit survey. Right after customers click on the unsubscribe button to ask them why they decide to leave, or either any improvements from your products or service. From these customers’ feedback, you can get valuable insights and improve your subscription box better.

For subscription service win back, email campaigns will be the most effective method to ask inactive subscribers to re-engage with your business. Keep in mind that win-back emails should include content like we miss you or come back has been overused. It is essential to dig deeper into customers’ needs and understand what they really expect by observing their behaviors.

Let’s take Tula as an example for a brand that has successful win-back email campaigns. It made a high engagement subject line: “We never do this but we miss you”. With the email content, Tula keeps customers irresistible with promotion discounts to persuade them to subscribe again. Besides, it put a CTA button to urge customer action immediately. 

In conclusion 

Above are some tips on how to decrease subscription churn rate for your business. Hope that with these tips, you can run a profitable subscription business with a low churn rate. 

If you have further questions about the churn rate or subscription box business, please contact us via live chat. Our dedicated support team is more than happy to assist you. 



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