Struggling with high churn rates? Effective strategies to bring it down

Learn key strategies to reduce churn, prevent payment failures, and enhance customer retention with simple, proven approaches.

Rohit Sai

September 5, 2024

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min read

Struggling with high churn rates? Effective strategies to bring it down

High churn rates can significantly hinder business growth, impacting both revenue and customer relationships. As the cost of acquiring a new customer is always much higher than retaining an existing one, it’s crucial to focus on reducing churn.

At Signeasy, we’re acutely aware of this. That’s why we are committed to reducing churn and improving the customer experience at every touchpoint. Below, we share some strategies we’ve implemented to effectively tackle this challenge.

Avoid payment failure before they happen

To proactively address potential issues before they impact the customer experience, there are several strategies to help prevent payment failures before they even happen.

Here’s how we can ensure a seamless and uninterrupted service for our customers:

1. 🔔 Nudge before payment

Timely reminders can significantly reduce the likelihood of payment failures, especially for auto-renewal subscriptions. Emails alone aren’t enough — you might miss them, or they could bounce back.

At Signeasy, we display in-app banners when a customer’s card is about to expire. This allows customers to update their payment details promptly, avoiding any disruption in service.

Alert bar on the dashboard when a card is about to expire.

Alert bar on the dashboard when a card has already expired before renewal.

Example: If a user’s card is set to expire next month, a banner appears on their Signeasy dashboard, prompting them to update their card information and ensure a seamless renewal process.

2. 💱Accept local currency

Offering payment options in local currencies can significantly boost customer trust and convenience, leading to higher payment acceptance rates. By creating a seamless and familiar transaction experience, we empower our customers to make confident financial decisions without the hassle of currency conversion.

Localizing currency options in any billing platform makes the payment experience more intuitive and comfortable for our global customers. This approach reflects our commitment to exceptional service and improves our international presence and customer retention.

Example: Customers in Europe could see prices and make payments in Euros, eliminating the uncertainty of exchange rates and making transactions smoother.

3. 💳Allow multiple payment options

Offering multiple payment options is vital to reducing failures and maintaining a seamless customer experience. By providing alternative payment methods — such as a second card or another payment type — we ensure that even if the primary payment method fails, customers can continue their transactions without interruption.

Primary and backup cards added for payment.

This proactive approach reduces churn and fosters customer loyalty by ensuring a more reliable experience. By addressing potential payment disruptions in advance, we enhance customer satisfaction and strengthen our relationship with users.

Managing payment failures

Even with the best preventative measures, payment failures can still occur. Here’s how we handle them:

4. ⏳ Provide a grace period

When a payment issue arises, it’s important to handle it in a way that doesn’t immediately disrupt the customer’s experience. Rather than blocking access right away, we offer a 14-day grace period across all paid plans. This allows users to continue using the product while they resolve their payment concerns.

This customer-centric approach is key to maintaining satisfaction, giving users the time they need to update their payment methods or resolve any issues without experiencing a service interruption. It also helps reduce involuntary churn and strengthens our relationship with our users.

5. 🔄 Smart payment retries

During the grace period, we employ smart payment retries and send friendly reminders to help users update their payment information. This approach gives users every opportunity to maintain uninterrupted service.

Additionally, we also include a “Contact Support” feature within these reminders, making it easy for users to get assistance if needed.

Example: If you’re using Signeasy and your payment fails during the grace period, our system automatically retries the payment and sends you a gentle reminder to update your details. If the retry fails, you'll receive a notification with a direct link to our support team, ensuring you have all the help you need to resolve the issue.

Other techniques

In addition to the above strategies, several other techniques address specific challenges to further reduce payment failures and enhance the overall customer experience. These methods ensure users enjoy a seamless and reliable service.

6. 🌍 Cross-border transactions

Cross-border payments can sometimes fail due to stringent security protocols and variations in banking practices between different countries. These challenges can cause delays or errors in transactions.

To address this, we can consider expanding our presence with local bank accounts in various regions. This approach streamlines transactions and makes cross-border payments smoother and more reliable for our users.

Example: By setting up a local bank account in India, we can process payments from our Indian customers more efficiently and reduce the risk of transaction failures.

7. 📊 Business payment history

A strong financial history isn’t just about numbers — it’s about trust, reliability, and the proactive steps we take to safeguard our business and customers. Payment processors rely on advanced algorithms to assess your business’s risk profile, which directly impacts your ability to process payments smoothly.

At Signeasy, we prioritize maintaining a good merchant record by promptly fulfilling orders and managing chargebacks. This ensures our standing with payment processors remains favorable.

This diligent approach not only avoids potential disruptions in payment processing but also builds trust with our partners, ensuring smooth and reliable transactions for our customers.

8. 📅 Offer longer-term plans

Offering longer-term plans can significantly reduce the number of recurring payments and minimize payment failures. By introducing options like yearly or even multi-year plans, users face fewer payment deadlines, resulting in greater financial stability and a significant reduction in churn.

For instance, if you opt for our new 3-year plan, you’ll only need to manage one payment every three years, drastically lowering the risk of payment issues and ensuring a more seamless, hassle-free experience. This approach simplifies the payment process and strengthens customer loyalty by offering more convenience.

However, it’s essential to recognize that longer-term plans might add a layer of friction for customers who prefer shorter commitments. Some users may be hesitant to lock in for extended periods, preferring the flexibility of shorter plans.

We’re committed to carefully evaluating this impact to ensure a smooth transition for all our users. Our goal is to balance the benefits of stability with the need for flexibility, ultimately enhancing the user experience while reducing payment-related challenges.

9. ⚖️ Payment disputes

Payment disputes can be challenging, but with the right approach, they are entirely manageable. Common disputes often arise from cases of fraud, where customers do not recognize a charge, or from situations where a subscription was canceled after renewal.

The outcome of these disputes can vary by country, making it essential to have clear terms and conditions and ensure customers are fully aware of our renewal and purchase policies.

By maintaining transparent policies and communicating them effectively, we can minimize misunderstandings and provide a smoother experience for our users. This proactive communication helps reduce the likelihood of disputes and builds trust with our customers.

At Signeasy, our team is trained to provide thorough documentation and evidence promptly, improving our chances of successfully resolving disputes.

We also rely on early fraud warnings issued by Stripe to act quickly and prevent future disputes. These alerts enable us to address potential issues before they escalate, ensuring that our users enjoy a secure and seamless experience.

By combining clear communication, robust policies, and proactive measures, we can navigate the complexities of payment disputes and maintain a positive relationship with our customers across the globe.

10. 💻 Using the right billing and payment software

The choice of billing and payment platform plays an important role in managing churn and payment issues. At Signeasy, we use Chargebee and Stripe for their robust features that are perfectly tailored for modern B2B SaaS billing. These platforms enable us to offer a seamless and flexible payment experience.

By leveraging their advanced capabilities, we ensure that our customers receive reliable service, supporting our mission to streamline business processes and enhance customer satisfaction globally.

By implementing these strategies, Signeasy is not only reducing churn but also enhancing the customer experience, building trust, and ensuring a smoother journey for all our users.

Let’s work together to make a resilient and customer-centric payment process!