As an objective measure of business performance, benchmark data is an invaluable resource on which businesses rely to help them make better-informed decisions. With a wide range of customers in multiple industries using Recurly, we have unique access to comprehensive data and metrics, which subscription businesses can use to make those critical decisions.
Effective decline management is critical to improving subscriber retention and maximizing revenue. Recently, the Recurly Research team completed an analysis of the effectiveness of these techniques in repairing failed payments and credit card declines that lead to involuntary churn. To conduct this research, we studied 1,200 subscription businesses over a four-month period, including analysis by audience (B2B vs. B2C), industry, and price point.
Overall, we found that subscription businesses risk losing 7.2% of subscribers each month due to involuntary churn—a significant figure.
The Recurly Research team investigated the issue from multiple perspectives to understand the impact of declined transactions: by percentage of subscribers lost, by revenue affected, and by revenue recovered. A multi-layered approach is necessary to address payment failures: through an Account Updater service, dynamic retry technology, and a well-crafted dunning strategy.
Recurly knows that minimizing involuntary churn is critical for subscription businesses. Without effective mitigation strategies, this loss of subscribers can inexorably harm a business’ vitality and growth.
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The value of Recurly is that we no longer have to worry about the different aspects of subscription management. Instead, we can focus on things that are our core competency, like adding value to our service and expanding our offering. That’s been a huge win for us.