When a customer decides to discontinue their subscription of a particular DTC product, it triggers a knee-jerk reaction for all founders. Especially for DTC founders invested in their product, the emotional weight of each cancellation is immense.
At Loop, we work with many such DTC founders. And they have a strong bias-for-action to motivate subscribers to stick with the subscription.
We've recently partnered with three founder-led brands facing high cancellation rates, and built retention campaigns to tackle each of them. Our retention strategy involved two steps: first, identifying why subscribers were cancelling, and second, using video content to directly address those reasons.
As a result, we witnessed a significant decrease in churn. With the power of video, our merchants were able to forge stronger connections with their customers and bring down subscription cancellation rates.
Want to hear more stories of how Loop has helped businesses cut down customer churn? Dive into our detailed case studies.
One of Loop’s features that has been most effective in slashing churn is cancellation flows. Through cancellation flows, eCommerce operators can build interactive, custom cancellation flows. These flows can have multiple formats: surveys, bonus discounts, videos, gifs.
So how did we leverage cancellation flows as an essential part of our retention strategy? Let’s go step-by-step.
First, we analyse the cancellation reasons, based on which we segmented all users. This segmentation happens on the customer’s cancellation reason, total orders completed, and subscriber profile.
Second, ask the founders to step in, and record a video message for their subscribers that would appeal emotionally to those reasons.
Third, we activated Loop’s custom cancellation flows to set up this retention campaign.
After enough time passed, the results were impressive. We observed a substantial reduction in churn.
Additionally, more users than before chose to pause or skip their subscription instead of cancelling. This is a positive development because subscription cancellations are permanent. But customers skipping or pausing the subscription is a temporary setback.
And sometimes, when life happens, customers may have to step back from their subscription. However, with the pause/skip option, your customers have the flexibility and encouragement needed to maintain their subscription in the long term.
Founder: Dr. Blake Livingood (LinkedIn) | Shopify store
Reduction in cancellation rate: ~24.67%
Additional benefits of adding the video 👉
Percentage of subscribers opting for alternative actions (Swap, pause, delay or using a discount incentive): 3%For an in-depth look at Livingwood Daily's journey in scaling subscriptions, check out their customer story. Plus, here is the Shopify review they left for us. Providing the best merchant experience is at the heart of what we do at Loop. It’s truly rewarding to see our clients win in subscription growth.
Founder: Russell Saks (LinkedIn) | Shopify Store
Co Founder: Michael Yewdell (LinkedIn), Tarun P Singh (LinkedIn)
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Reduction in cancellation rate: ~28.86%
Additional benefits of adding the video 👉
Percentage of subscribers opting for alternative actions (Swap, pause, delay or using a discount incentive): 13%
Founder: Dr. Elena Seranova, Ph.D (LinkedIn) | Shopify store
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Reduction in cancellation rate: 37.63%.
Additional benefits of adding the video 👉
Percentage of subscribers opting for alternative actions (Swap, pause, delay or using a discount incentive): 11.76%
Here’s a glimpse into the Shopify review left by NMN Bionutrition, addressing their seamless migration experience and decrease in churn since they switched to Loop.
Subscribers cancel because they no longer feel a personal connection with the brand. Founders can bridge this gap with the right video messages when subscribers are about to cancel.
Within the video category, there is a lot of room to experiment. For instance, you can choose different content angles from educational to success stories to a Q&A format. Creating education-led retention campaigns can also yield impressive results. If you are also struggling with high subscription cancellations and were inspired to execute next-gen retention campaigns, try Loop for free today.
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