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Involuntary churn can be a significant challenge for subscription-based businesses, leading to lost revenue and disengaged customers. However, with the right subscription / churn management tools and strategies, you can drastically reduce the number of customers who unintentionally drop off due to issues like payment failures. High end subscription apps (like Loop Subscriptions) usually are equipped with features to combat involuntary churn.
Here are 8 powerful ways to minimize involuntary churn and keep your customers engaged.
One of the simplest yet most effective methods to combat involuntary churn is to set up automated payment retries. Instead of losing a customer after a single failed payment, configure your system to retry the payment at optimized intervals. This increases the chances of a successful transaction without any manual intervention.
Loop allows you to configure the number of retries for failed payments, the timing of those retries, and the actions to take if all retries are unsuccessful.
1. Retry Failed Payments: Choose how many retries will be provided.
2. Delay Before Retrying a Failed Payment: Configure the number of days before a payment is retried.
Customers often face issues when their payment methods are outdated or invalid. Offering an easy, self-service option for customers to update their payment information can significantly reduce involuntary churn. By providing a straightforward way to update payment details, you ensure smoother transactions and continued customer engagement
With Loop, you can upload multiple payment methods, allowing customers to easily set their preferred payment option and make payments seamlessly.
Dunning management is essential for recovering lost revenue due to failed payments. A well-designed dunning process includes sending personalized emails or SMS notifications to customers, alerting them about payment issues, and guiding them through resolving the problem. By keeping the communication clear and customer-friendly, you can recover a significant portion of potentially lost revenue.
Loop Subscriptions offers powerful dunning features accessible directly from the Loop app. With advanced logic, our platform predicts and reduces failed subscriptions, helping you address issues before they occur.
Prevent payment failures by sending automated reminders to customers when their credit or debit cards are about to expire. These proactive notifications give customers ample time to update their card information, ensuring uninterrupted service and reducing the risk of involuntary churn.
Customer Success Story - The Patch Brand reduces payment failures by 65%
Patch Brand reduced payment failures by 65% and recovered over 94% of their subscription revenue. Their SMS campaign on failed payments achieved a ~12% CTR in just one month. Customers appreciated the convenience of updating payment details via one-click logins through SMS.
Identifying at-risk customers before they churn is key. Use your subscriptions / churn management tool to pinpoint customers who frequently encounter payment issues and engage with them proactively. Personalized communications, such as special offers or reminders, can help resolve issues before they lead to churn.
The Loop app lets you set up admin alerts to proactively manage payments at high risk of failure. You can configure it to send weekly or monthly reports with a list of these upcoming payments.
Offering multiple payment options is another effective strategy. By enabling payments through various methods—such as credit cards, PayPal, and digital wallets—you reduce the chances of payment failures due to limitations in available payment methods. The more options you provide, the less likely a transaction is to fail.
Leverage the analytics provided by your churn management tool to identify trends and patterns in payment failures. Understanding the common reasons behind involuntary churn allows you to proactively address these issues. For instance, you might discover that certain customer segments are more prone to payment failures and can then tailor your strategies accordingly. Choose a subscription / churn management app that gives you a statistics drilldown of high risk payments, expired card stats, failed payments - so that you can take corrective steps.
Loop’s dunning management - analytics section provides a clear visual overview of your upcoming subscription payments. Here’s what you’ll find on the dashboard:
Additional insights include:
One size doesn’t fit all when it comes to billing cycles. By allowing customers to choose or adjust their billing dates, you make it easier for them to manage their finances. This flexibility can be crucial in reducing failed payments, as customers can align their billing with their cash flow.
The Loop app gives you the ability to have flexible billing dates making financial management easier and more streamlined.
Reducing involuntary churn requires a proactive and strategic approach. By utilizing these 10 strategies with the help of a robust churn management tool, you can not only recover lost revenue but also build stronger, more loyal relationships with your customers. In today’s competitive landscape, every effort to retain customers counts—and these techniques can make a significant difference in your business’s success.
Emma Johnson is celebrated for her strategic brilliance and innovative flair. By seamlessly blending creativity with data-driven insights, she has propelled Loop’s brand to new heights, establishing it as a formidable force in the Shopify Subscriptions space.
