Login is restricted to DCN Publisher Members. If you are a DCN Member and don't have an account, register here.

Digital Content Next


Research / Insights on current and emerging industry topics

Cancellation strategy is an essential piece of subscriber retention

January 29, 2024 | By Michelle Manafy, Editorial Director – DCN @michellemanafy
The topline: Increasingly, customers expect streamlined cancellation processes and regulation requires it. Therefore, cancellation is a key aspect of a retention strategy.

As the industry increasingly incorporates subscriptions into diversified revenue strategies, media companies need to take a fresh look at their subscription cancellation processes. Not only do customers expect streamlined cancellation processes, smart companies conceive of cancellation as a critical aspect of an effective retention strategy. And all companies must be aware of changing regulations around facilitating the cancellation process.

In a new INMA report, Using Subscription Cancellations to Retain News Customers, Robert Skrob (author of the book Retention Point) cancelled subscriptions with 14 of the world’s largest English-language news media publishers in one week to experience and analyze their processes.

Using these experiences, Skrob outlines which companies are making it simple to cancel, which ones are making it difficult, and which ones offer lessons worth learning. With specific examples of what they’re doing right and what they could do better, Skrob offers an insightful look into the experience of subscribers as they try to cancel, which will help media companies design processes that leave audiences with a positive impression or – even better – convince them not to leave.

Building a retention-based cancellation process

Through his work, Skrob has found that many media companies have not developed the kind of cancellation process that is designed for retention. He finds that cancellations are an often-neglected aspect of the media business, relegated to accounting or administration. He suggests moving this function to the marketing department as an aspect of subscriber-retention.

Many media companies have created complex or opaque cancellation processes designed to dissuade unsubscribes. The effectiveness of this approach is the subject of some debate. However, the FTC has proposed the “click to cancel” rule, which would require companies to allow consumers to cancel their subscriptions in the same way, and just as easily, as they subscribed in the first place. So, whether companies like it or not, it’s time to develop easy cancellation processes that may actually improve retention.

While many types of subscription-based businesses have pushed back on this requirement, Skrob believes that there are tactics that can be incorporated to reduce the likelihood of churn. For one, companies can do a better job of communicating the benefits and value of subscription to audiences. For example, The Financial Times includes a “before you go” message which outlines exactly what subscribers lose when they cancel. The Telegraph cancellation process also includes a page that demonstrates the value of the exclusive subscriber benefits and explains what the subscriber will lose after cancellation.

Giving would-be cancellers an offer to stay increases retention, according to Skrob. He finds that upsells work better than downsells in terms of recurring revenue. He also suggests that, if you don’t have an upsell, that you consider offering a lower-priced subscription tier to retain customers.

If a customer does in fact cancel, it is important to send them a confirmation of cancellation so that they know that they’ve completed this step successfully. However, even this confirmation should be viewed as an opportunity to reengage. This, as well as communicating transparently their remaining subscription benefits and duration of subscription until cancellation is finalized, works towards building trust. And that trust will pay off as you work to regain them as a subscriber.

Case studies and a case for improved cancellation strategies

Based upon his research, and case studies examining the best (and some not so great) practices from the media companies’ processes he investigated for the report, Skrob makes a solid case for  investing marketing time and energy into your subscription cancellation processes. Yes, this can positively impact subscription retention and revenue growth.

However, the report also builds out the connection between these processes and improving audience trust – something the media industry has struggled with for some time. As Skrob explains, creating cancellation processes with skill and integrity can grow trust for your brand. Cancellation management is a critical piece of subscription growth which in turn will enable your media company to invest more in the products you deliver, and help grow a sustainable media industry.

Print Friendly and PDF