For businesses, particularly those with subscription-based and monthly recurring income business models, it has never been more important to keep your present customer base and sustain long-term customer relationships. Involving your current customers, urging them to continue with your product, enhancing retention, and lowering customer churn can all be achieved with the help of well designed and strategically timed renewal reminder emails.
What are renewal emails?
Automated messages called renewal emails are sent to current customers to inform them that their membership or subscription is about to expire and to prompt action. These kinds of emails are frequently used for products with recurring payments as well as subscription-based services.
Long-term income stability depends on people locking in subscriptions and renewing their plans. You need effective recovery emails that make it simple for your customers to continue paying for your product. You'll also deliver superior customer service if you prioritise your customers' demands.
Card Expirations Decimate Your Revenue
When a customer's payment doesn't go through, which you won't see until the end of the customer's subscription period, the harm is already done.
They are no longer providing revenue and you have no longer any means to bill them. This has a significant negative impact on your bottom line because recurring income is what subscription businesses rely on to fuel growth.
You could believe that your cash flow will only be momentarily hampered by this setback. The reality is much worse. Interruptions from failed payments often turn into permanent cancellations.
The explanation is straightforward: unintended renewal failures brought on by expired credit cards drive your clients to make a completely new purchasing choice (and an opportunity to churn). They must once more justify the price in comparison to other available options, which brings back a significant portion of the friction from their first purchase. Some will either decide to cancel the subscription or downgrade the plan. This is a significant unforced mistake for your company. Your yearly subscriptions, which are particularly prone to payment errors, will have an even greater impact.
The vast majority of credit cards have 36-month expiration dates. You could easily lose a significant portion of your yearly subscriptions each year due to late churn if all of those expirations remained unattended. Your plans' duration affects how likely it is that they will expire and impede successful billing. Because yearly plans are so crucial to your company, this might seriously hurt your bottom line.
One reason your yearly customers are more likely to have greater lifetime values is that a higher proportion of annual plans is associated with reduced customer attrition. You're also more likely to attract high-value enterprise customers that prefer annual plans over month to month arrangements.
Your yearly clients significantly improve your cash flow since they provide you with lump sum payments that you may use to fuel quicker business growth.
The benefits of yearly plans exceed the drawbacks, despite the larger likelihood of payment failures. Here are some tips for using email to reduce those risks and please your clients.
Writing Renewal Emails that Boost Retention
Emails for recovery and renewal often have a poor reputation. Nobody likes to appear to be asking for money, after all. There's no need to be afraid of sending them, though.
When done correctly, recovery emails may be a critical element of your strategy for providing the best possible all-around client experience. You can also utilise video editors to send emails that are more impactful. The three pillars of customer retention—keeping customers satisfied, minimising customer effort, and providing great customer service—can all be maximised with the use of these emails. Let's examine each pillar, beginning with consumer satisfaction.
Keeping customers satisfied
Your customers will be happy with your product if they perceive that:
- It offers the ideal solution to their issue, and
- They are paying a fair price considering the value they are getting.
You may remind them of both of these things in renewal emails. The best emails promote the things your customers use most frequently and include data that show ROI in terms of time or money saved. When it comes to publishing, you may show how much time a consumer has spent seeing your material overall or list their favourite subjects, among other things. These support your request for updated payment information and reduce the purchase friction. They make updating payment information a no-brainer - after all, a happy customer has just received a reminder of value from reading the email.
Minimising customer effort
The second pillar of retention focuses on minimising consumer effort. According to research published in the Harvard Business Review, one of the best ways to boost customer loyalty is to minimise the amount of labour they have to perform.
This means getting rid of every barrier to payment for recovery emails. Give your client all the tools they require to renew by:
- Providing a personalised link that takes the client to a page with pre-filled forms for their payment update
- Including a summary of their account details and an accurate pricing breakdown
- Describe the features your customers may expect in the future
Offering good customer service is the last pillar of retention. Utilise your recovery emails as a chance to get in touch with your consumer. If you're sending out recovery emails before a customer's membership cycle has expired, this is extremely effective.
Include the request for their payment information in a bigger discussion about how to make their experience with you better by:
- Requesting and responding to customer input about the product: Recovery emails are an effective tactic for starting conversations with your customer regarding future development or changes since they provide you the qualitative information you need to enhance your product while providing your customers a sense of ownership over your service.
- Personalised Email: Use custom email templates to express your gratitude to your customers for their ongoing support. At the very least, be sure to mention their names and the amount of time they have spent using your product.
Any effective renewal plan is built on optimised recovery emails. The greatest recovery emails remind your customers of the benefits they receive from your product, making it simple for them to update their payment information, and inviting customer development discussions you can use to enhance your offering.
An investment in the success of your business and your clients is made when you take the time to create an effective series of emails and incorporate some of the other renewal methods we outlined into your approach.
If you need any help with your subscription journey are you are thinking to migrate your publishing business to the subscription business model contact us today.
Evolok helps online publishers increase their revenues and drive audience engagement using Evolok’s end-to-end SaaS solution, which provides paywalls, subscription management, user segmentation and identity management. Evolok delivers a selective ecosystem to drive user engagement and mobilization. Evolok helps its clients increase readership and revenue by engaging and personalizing content, protecting valuable content through paywalls, utilizing login and social data to incrementally know customers and finally targeting products and pricing to boost subscriptions.