Your customers are key to the success of your business, so keeping them should be your number one priority, especially since it costs more to acquire new customers than to retain the ones you have. At Segpay, our merchants’ retention rate for recurring subscription memberships is just under three rebill cycles. The longer those memberships can be extended, the lower the customer acquisition costs will be. So, what are some of the best ways to increase customer retention rates? Follow these key steps.
First, you really need to understand your customers. Take time to analyze your usage data. For example, track how often someone is logging in. And if you see login rates falling, plan to implement a pre-emptive cancel strategy to interact with your customer before it’s too late. This can include an automated customer interaction, such as a survey — when the customer is not engaging as much with your content, try to find out why. Knowing why your customer’s interest level is waning can help you devise the best way to retain them.
Take time to analyze your usage data … knowing why your customer’s interest level is waning can help you devise the best way to retain them.
So, how exactly do you keep customers from leaving? That is the second step, remarketing to your customers. For example: offering clients discounts to stay. Segpay merchants who use retention offers with discounts to entice customers to reconsider their cancellation save seven percent, on average, of subscribers who otherwise would have canceled. Merchants that have used especially aggressive offers have seen rates as high as 10 percent. We introduced cancel/keep offers last year, allowing merchants to make discount offers to a member who wants to cancel. The offers only take minutes to set up but can save merchants big money in the long run. The longer you can retain a customer, the more lifetime value that customer brings to your business.
It also helps to have a strategy for winning back ex-customers. This year, we introduced reactivation offers so consumers can easily reinstate a cancelled or expired subscription without having to re-register. Merchants can have reactivation links automatically included in emails that are sent to the consumer to confirm his or her cancellation. Merchants can also create email marketing campaigns using reactivation links. Merchants can regularly run a report that shows recent cancels and expirations and easily send marketing emails to those ex-subscribers. To make things easier and more targeted, Segpay offers custom cancel reasons so merchants can obtain better insight into cancellations. You can segment those marketing emails by the cancel reason with targeted messaging to win back customers, letting them know you’ve heard their complaint and have addressed it.
Lastly, it’s important to simplify things and offer different services. For example, once a customer is back in the fold, make sure you are making it as easy as possible for them to purchase additional services. Using a one-click pricing option allows existing consumers to buy without having to re-enter their card information. That same one-click process also works well for cross-selling content to existing members. Prior to displaying a cancel/keep offer, try giving the customer other options like a different subscription either on the same site or a different one. Highlight the best offer available based on cost per day, making it crystal clear that for a long-term commitment, the cost per day goes down.
Providing great customer service and having consistent communication can go a long way towards retaining customers. When you find something your customer likes, give them more of that. Make them feel special by inviting them to beta test new products so they feel a part of your community. When you can, do something unexpected and nice for your customer like offering a promo offer or free gift. Welcome their feedback, good or bad. A happy customer knows you’re listening to them. Follow these steps to gain customer loyalty and lessen the chances they’ll hit the cancel button.
It took only three years for Cathy Beardsley to turn startup Segpay into a profitable company. As president and CEO, Beardsley oversees the day-to-day operations and long-term strategic planning for the company. Segpay is one of four companies approved by Visa USA to operate as a high-risk internet payment service provider in the U.S. Since 2005, Segpay has offered online merchants a state-of-the-art billing platform that provides real time payment processing around the globe.