Zig Ziglar says, “Lack of direction, not lack of time” is the problem with modern involuntary churn. Payment failure is the number one cause of payment failure, and reducing card declines can bring payment failure rates as low as 0.5%. Altogether, that’s a 70% reduction in involuntary churn.
Today, auto-renewals account for 62% of subscription revenue. Yet, auto-renewal increases the likelihood of failed payments. Moreover, 47% of brands lose auto-renewals due to changes in payment data.
It costs 5x more to attract new customers into a business than to keep existing ones. In other words, remember that the customer is always right. More often than not, customers may only learn their payment failed when their service stops. Still, payment declines and their accompanying fees can create an enormous amount of customer frustration.
As a result, business leaders and customers should work together to address negligent payments. As a general note, a satisfied customer is more likely to cancel a subscription and more likely to add services or upgrade their existing package.
Do you have a wide percentage of involuntary churn within your business? Keep reading to learn how your team can fix that.