Building a Subscription Ecommerce Business That Addresses Churn From the Ground Up: Seeing Results Takes Time. Be Patient.

This article is the second in our three-part series on addressing the root causes of churn. Check out the first and third parts to learn about making your business churn-resistant.‍

As you discover and address the causes of churn in your business, you’ll notice that results take time. No change or improvement you make to increase retention will take effect immediately. Some take three months or more!

Nevertheless, building your business with churn-fighting in mind is crucial, even though seeing the results takes time. Let’s talk about why results take time and the fundamental areas where you should focus on improving your business. 

Why Fighting Churn Takes Time

Many marketing strategies show results immediately. You should see traffic within the hour if you buy ads or post on social media. If you email your list, anyone who will open it will do so within a few days. 

But fighting churn is frustratingly slow.

“Retention is slow,” said Joelle Goldman during an episode of Subscription Ecommerce Live. (Joelle co-founded Churn Buster, a SaaS company that helps subscription ecommerce brands reduce churn by recovering failed payments.) “It takes a long time to see its effects, especially if you’re tracking month-over-month. You have to wait months to see what happens.”

Why months? Because you have to wait for a true cohort of people to come through your retention system. Time is the only way to get an accurate picture of your results.

Look at it like this: Suppose you implement a new retention strategy on Day 1. You already have subscribers in some churn mode, so your retention-reducing method is too late for them. It may work on some of your existing subscribers, but you won’t be measuring its full effect because it may not be enough to stop someone who already has one foot out of the door.

So you must wait 30 days to get a fresh crop of subscribers who haven’t considered churning yet. Day 30 is when you start tracking the effectiveness of your strategy.

Day 60 is the first renewal, where you’ll start to see if your retention is working. You’ll know you're getting somewhere if the number of first renewals exceeds the previous month’s.

But it isn’t until Day 90 that you get a complete picture. Some people will unsubscribe before their first renewal, whether actively (by deliberating unsubscribing in the account portal) or passively (failing to update their subscription with new payment details).

Day 60 to 90 is when you should attempt to recover churned subscribers. If they don’t subscribe by Day 90, you can officially count them as churned. That said, depending on the nature of your products, you might continue to work to win them back past 90 days. 

Focus on Your Fundamentals

The primary challenge of fighting churn is that it isn’t as simple as installing an app or plugin. You can’t just sign up for a new tool and call it a day. Addressing churn is about making fundamental changes to your business.

Addressing churn is about making fundamental changes to your business.

“[Retention involves] All the things we know we need to do. And they’re hard to do. There are no shortcuts,” Joelle told us. 

So what are the fundamentals of a low-churn subscription business?

Feedback

Your first step is to analyze why churn happens in the first place. Gather as much information as you can from your customers. Send surveys, host interviews, and explore your analytics with as much detail as possible. Pay people for their feedback if you must.

Don't disregard any piece of feedback. If a customer says your product is the problem, consider how you can change it. “Make sure you’re offering a product that people want and keep getting,” Joelle said. “There’s competition everywhere. If your product sucks, people will figure it out and stop buying it.”

Acquisition

Acquisition is about finding the right people for your business. These are your “good fit” subscribers we discussed in our previous article.

Focusing on the right subscribers takes time. Sometimes they’re harder to reach because you must know them well enough to find them. But it’s worth the effort because they’re far more likely to renew over and over.

You don’t have to decline customers who don’t fit your profile perfectly (a few months of sales is still good) but don't go out of your way to acquire people who will probably cancel early. 

Personalization

The best experiences are personalized experiences. Your subscribers want an experience tailored to their needs, not a generalized subscription designed for everyone.

Your subscribers want an experience tailored to their needs, not a generalized subscription designed for everyone.

How do you personalize? Learn as much as possible about each subscriber and store it in an accessible place, like a marketing automation tool. Using a quiz to collect early data points is always helpful. 

Communication

Use clever and well-timed communication to ease your subscribers’ anxieties, solve their problems, and make them feel understood. Keep the value coming with education, entertainment, and other valuable content via email and SMS. Don’t make every interaction transactional.

Control

There's always a bit of anxiety involved with subscribing to a product. Subscribers don’t want to run out but don’t want too much. And they don’t want to pay for something they didn’t need.

You can put them at ease by giving them tools to control the subscription without contacting customer support. They'll feel more comfortable subscribing if they can solve their problems and make their own changes.

Pro tip: ARPU gives your subscribers control over their subscriptions without the need to log into the account portal. They can swap variants, change shipment intervals, delay shipments, and add 1-time products and subscriptions to their order.

Getting Quick Wins in the Fight Against Churn

As we said, properly fighting churn means building retention in your business from the ground up by focusing on those fundamentals. That said, there are some things you can do to get some quick wins.

Here are a few tactics you can implement right away to fight churn. These will become more effective once you address the root causes of churn in your business. 

1. Establish a Dunning Process

Sometimes, subscribers churn because their payment methods fail. These failures can happen for several reasons, but not because they want to unsubscribe. We call this passive churn. (The opposite is active churn when a subscriber deliberately cancels.)

Passive churn is frustrating because the subscriber never intended to cancel. They were happy with the subscription, but logistics got in the way.

You can recover these subscribers with a dunning process. “Getting a strong dunning process in place is the lowest hanging fruit,” Joelle told us.

A dunning process is simple: When a payment fails, interrupting a subscription, the subscriber receives emails that prompt them to update their payment details. You can customize these emails with anything you like - custom content, unique copy, special offers, etc.

With a tool like Churn Buster, you can implement this process in just a few moments. Once the process is in place, you should reduce the passive churn to very little. Subscribers will either a) update their payment details or b) refuse to update their payment details, which turns their passive churn into an active churn. 

2. Don’t Consider Them Canceled Right Away

Don’t give up on your subscribers after they cancel. They may have some objections or problems that you can overcome and win them back.

When a subscriber cancels, a recovery process should kick off. There’s a period where they might be willing to resubscribe if you can solve whatever objection made them cancel in the first place. But you have to act quickly.

Don’t give up on your subscribers after they cancel. They may have some objections or problems that you can overcome and win them back.

Create an email flow that asks them why they canceled. If they have a solvable problem, offer a solution. 

3. Use Different Touchpoints to Contact Subscribers

If you can’t reach a subscriber by email, use other communication methods to get their attention. No, you don’t want to spam them everywhere, but sometimes a poke on a different platform is an excellent way to let someone know you’re trying to reach them.

• SMS - If the subscriber gave you their phone number, they don’t mind you contacting them this way. Send a short text message with a link to a landing page tailored to churned subscribers. 
• Push notifications - If you’re selling through an app or the subscriber has enabled push notifications on your site, create an automated flow that nudges them to visit your landing page for churned subscribers. 
• Ad retargeting - Since you have the subscriber’s email address, you can serve them ads on social networks, like Facebook and Instagram. Doing this is advertising to a custom audience.

4. Don’t Send the Same Messages Over and Over

When you communicate with churned customers, sending different content in each message is critical. Don’t spam them with the same copy and images over and over. It’s annoying and a great way to convince the subscriber to block your messages.

Besides, if a message didn’t work the first time, why would the same message work the second or third time?

If every message is identical, your subscribers' email clients might consolidate them into the same thread. They could all end up in the same place, like the spam folder.

Create unique content for each message that appeals to your subscriber. Use the message map we mentioned in the first article of this series to use the right language. Remind the subscriber about why they subscribed in the first place. If you aren’t getting anywhere in the first few messages, consider offering something to sweeten the deal, like a discount.

Experiment with simple, text-based emails as well. Sometimes branded messages are hard to ignore, but if an email shows up that looks like it came from a friend, they might give it a read.

Big Changes Take Time

Making fundamental changes to your business isn’t easy. You may have to return to the drawing board and rebuild your key systems, like your email flows, product offerings, and website. But the results of those changes are worth the wait, and your subscribers will thank you for it.