Is this what your retention data looks like?
Let’s look at the common retention curve in subscription model businesses:
A pretty dismal story for subscription businesses, right? Wrong! It looks like opportunity - now let’s take a peek at a sample of how that curve might change if you simply get more of your ‘trial’ customers to get a second order.
Instead, you could make it look like this:
Why you should spend time and energy on onboarding (hint: $$$)
Let’s pretend the price of your subscription for consecutive orders is $49.99 / order and you are acquiring 100 new customers per month. By simply improving first to second order retention by 15%, you’ve now scored yourself $39,000 in additional annual revenue by getting more of your customers to receive 9 orders. But that's a conservative ROI. You can do the math - the number almost doubles to $72K if they stay with your brand even longer - which you can assume they will do. Note your churn rate levels out around order 10.
While this gives you a place to focus your retention energies - onboarding doesn’t stop at order 1! So what additional ways to delight your customers between each early order can you deploy to install a sense a value and loyalty to further increase revenue? Cheers to opportunity sleuthing!
A word of caution...Keep it simple...at first. You are running with low staff and a lot of tasks to attack in each order cycle. So, what are some quick wins you can try out right now?
Don’t forget to read our follow-up post “Tangible Quick Wins: 3 Customer Onboarding Tactics That Will Score You Significant Payoff”
For an evaluation of your current new customer onboarding experience and where to focus, fill in our New Customer Insights & Action Plan request. There are often two or three quick wins you can implement within a few weeks to lower churn immediately. Let’s get started finding some revenue opportunities for you.
4/21/2022 10:17:08 am
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8/30/2022 02:23:20 pm
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