3 Ways to Improve the Customer Cancellation Experience
You don’t go into the subscription business dreaming about designing the perfect customer cancellation experience. Chances are you’re far more focused on customer acquisition.
Yet, the customer cancellation experience is one of the most natural places to reduce customer churn and improve customer retention – both of which can significantly impact your bottom line. For example, did you know that increasing customer retention metrics by just 5% can increase your profits from 25-95%?
That’s why at ProsperStack, we view the cancellation experience as part of the entire customer experience. It’s not something to tack on at the end or design as an afterthought. Instead, the cancellation experience should be given as much attention as any other customer touchpoint.
This approach aims to preserve more monthly recurring revenue and position yourself for higher lifetime customer value.
Here, we walk you through three ways to improve the customer cancellation experience and offer tips and best practices to save more customers on the verge of canceling.
Customers don’t always cancel because they’re unhappy with your product. Sometimes they cancel because they’re facing unrelated challenges.
When you design a simple customer cancellation experience, you ensure their last interaction with you is pleasant and leaves them with a favorable impression. This can lead to positive word of mouth, referrals, or even their returning when circumstances change.
Here’s what we recommend:
Make sure your cancel button is easy to find
Share what happens once they click cancel (e.g., what info they lose access to and when)
Include an acknowledgment if they’ll lose data of any kind
Explain what happens next (e.g., any final charges or download deadlines)
To save customers, you need to find out why they want to cancel. This is where an exit survey comes in. We recommend keeping it simple and asking just two questions:
What is your primary reason for leaving (multiple choice)
How can we improve (open-ended)
This approach provides quantitative and qualitative data you can use to improve your product. And identify subscribers you have the chance to save.
Side benefit: ProsperStack’s easy-to-read dashboard lets you see individual and aggregate survey results. Hello, insights.
Now it’s time to provide a cancellation alternative. But again, the goal here is to be quick and make your best offer upfront. No games. No labyrinths. Just a targeted offer based on their reason for leaving. Your options include the following:
Discounted price – provide a temporary discount such as 50% off for three months. This option appeals to customers who want to cancel due to financial constraints.
Plan change – offer a downgraded subscription plan that provides fewer features at a lower cost. This option will also appeal to customers canceling due to financial constraints.
Subscription pause – allow customers to take a break from the product without canceling altogether. This option will appeal to customers who are facing a temporary challenge.
Trial extension – let customers keep using your free version for a defined period. This option works well if customers aren’t sure whether they’ll benefit from your product.
Over time, you can add more conditions to this step while keeping the experience simple for customers. With ProsperStack, you can:
A/B test different offers – pit offers against each other to see what’s working and optimize your results.
Segment by customer types – divide your customers into groups based on payment criteria like MRR, billing interval, subscription duration or plan, data from your CRM or CDP, or custom data from your application or service.
If you’re ready to improve your customer cancellation experience, you have two choices: build a better process in-house or add a platform like ProsperStack to your existing tech stack.
ProsperStack is a seamless, user-friendly, low-code solution your development team can implement within days. Our platform works by easily integrating with the most popular payment processors and multiple CRMs. Then, we match you with a dedicated retention expert who is there to personally support and guide you through initial implementation and ongoing optimization.
Find out how our customers reduce churn by up to 30%. Get a ProsperStack demo.