Managing churn is a constant battle for subscription publishers. The ability to attract and convert new subscribers is undermined if a large portion consistently fails to renew. While subscriber churn isn’t always something to be feared, understanding and managing it is a fundamental requirement for any sustainable subscription publishing business.
Not all churn is alike. It’s essential subscription publishers delineate between passive churn and active churn, and that they institute effective strategies to address each.
What is passive subscriber churn?
Churn can be broken out into two distinct categories:
- Passive churn (or involuntary churn) refers to instances where a person’s subscription lapses without them taking action, typically because a publisher cannot successfully charge the subscriber’s card or payment method, or because of other technical failures outside of the subscriber’s control.
- Active churn (or voluntary churn) refers to cases where a subscriber takes specific action to cancel a subscription or disable auto-renewal, or intentionally lets a subscription lapse.
This guide focuses on tactics for mitigating passive (or involuntary) subscriber churn.
Causes of passive subscriber churn
Passive subscriber churn is most often caused by a publisher’s inability to successfully charge the credit card or payment method that has been provided by the subscriber. Reasons for payment failure can include:
- Expired credit cards.
- Canceled credit cards.
- Changes of address.
- Insufficient funds or credit limit reached.
- Credit card issuers declining payment for security reasons.
- Subscription management software or other technology failing to initiate transactions correctly.
How to reduce passive subscriber churn
For subscription publishers, ignoring passive churn is not an option. All credit cards expire, and eventually, a publisher’s entire subscriber base will churn passively without a mitigation strategy in place.
The following tactics and best practices can be used to reduce passive subscriber churn: