How to write a good cancellation email; change your subscribers’ worldview on subscription deception; and optimize recovering revenue, chargebacks, and order processing data.

Key Takeaways

• It’s best practice to re-engage a subscriber before we get to the point of inactivity/cancellation, which is why we built our Recovery Optimizer solution to auto-optimize payment retries.
• Programmatically cleaning up subscription and order data minimizes the chance of chargebacks, which are costly and time consuming to manage.
• The worldview on subscriptions is changing. With dozens of apps and financial wellness experts disparaging “sneaky” subscriptions for being intentionally difficult to cancel, disengaged clean-ups are a strong step towards maintaining a trustworthy and transparent relationship with your subscribers.
• Disengaged Subscription Concierge sets you up for a better recovery rate from the start. Most other subscription providers will cancel subscriptions after the first failed payment retry flow; missing out on subscriptions that may re-engage when a card’s funds are renewed. Whereas our disengaged flow allows for 3 consecutive (in a row) failed orders to qualify for an automatic cancellation; maximizing the likelihood of re-engagement while still avoiding an excess of chargebacks and fees.
• When canceling a subscription, transparent communication with a clear indication of next steps gives you the best shot at re-engaging a subscriber.

In our next module, we talk about using subscriber winback/reactivation campaigns to recoup thousands of dollars in recurring revenue (if you haven't seen that yet, check it out here). In that module, we briefly mention disengaged subscription cleanups; or intentional cancellations of subscriptions with three or more consecutive failed orders.

Ordergroove's Disengaged Subscription Concierge automatically cancels these subscriptions for you after their third consecutive failed order; keeping your order processing rates healthy and letting you most accurately monitor your subscription program. (yes, it's pretty cool!) You can choose to notify customers via email of this cancellation or not - but we recommend reaching out to them with some options for next steps. So today, we'll break down how to use disengaged clean-ups to maintain healthy customer relationships, how to re-engage subscribers before a cancellation is needed, and how to create the optimal disengaged subscription clean up cancellation email flow. 

What makes a subscription disengaged?

We consider subscriptions as "disengaged" when they hit 3 consecutive (in a row) failed orders. The most common causes of this are expired payment information, or missing customer information like an address. Giving customers 3 consecutive orders to update their information means these subscriptions are not likely to be updated without further action and should be cleaned up.

Disengaged subscriptions are not the same as inactive subscriptions. Inactive subscriptions are just that - inactive. They’ve been canceled by either the customer, your support team, or your Disengaged Subscription Concierge.

What’s in it for my business?

Great question! Disengaged subscriptions are pesky for a couple of reasons. Here’s why cleaning them up benefits your business.

Expensive Chargebacks from Friendly Fraud

Transparently, chargebacks aren’t fun for anyone involved. They’re often time consuming and fraught with emotion on the customer side - and they’re costly for businesses, with payment processors charging varying fees like Stripe’s $15 fee per chargeback.

Disengaged subscriptions are often the cause of what’s referred to as “friendly fraud,” or when a customer disputes the charge because they’ve forgotten about this expense or don’t immediately recognize it. If a subscription has been disengaged for enough time and a subscription provider continues to attempt order fulfillment, in the cases where a customer’s card is potentially topped off or renewed, a charge may finally go through further down the line. If it’s longer than 3 order cycles away, we risk the customer forgetting about this subscription and disputing the charge due to genuinely believing this charge to be fraudulent. 

Cleaning up your disengaged subscriptions prevents these chargebacks from happening. If a customer decides to re-engage their subscription (we’ll talk more about how to incite this with a good reactivation email flow later), they’ll need to update their payment information and will also remind themselves where this charge is coming from in the first place.

Order Processing Rates and Clean Data

It’s relatively self explanatory - disengaged subscriptions will continue to try to place orders, which drops your order processing rates (which measures the percentile of subscription orders that are placed successfully vs. failed) and can make it hard to interpret a true measurement of your program’s health.

Subscription Program Pulse Checks and Goal Setting/Attainment

Due to messy order processing rates, it can be difficult to understand areas of opportunity and growth for your subscription program. If your enrollment rate is climbing but your recurring revenue output is plateaued, businesses are often left scratching their heads as to how to change performance for the better. Cleaning up these disengaged subscriptions with regularity can reveal opportunities for growth such as moving to a more prepaid-subscription first model (more on that here) or collecting and actioning on more specific cancellation reasons (more on that here).

Inventory Management and Demand Forecasting

Shameless plug: we have a handy complete guide to handling subscription stockouts in our next course. But for the purposes of disengaged subscriptions, we specifically wanted to callout demand forecasting. Subscriptions are quite possibly the most useful inventory forecasting tool - you have a real understanding of how many upcoming orders per product are slated to place within a timeframe. Disengaged subscriptions can occlude this foresight; making it difficult to understand how many successful orders (and thus those requiring inventory/product) will actually place ahead of time. 

Now that we understand why disengaged subscriptions aren’t ideal for your subscription program management, growth, and data hygiene, let’s talk about how to curate a smooth and engaging cleanup process.

Change the worldview on subscriptions by being transparent about disengaged subscriptions

Recent media and pop culture coverage of subscriptions has surfaced a negative perspective of distrust for consumer audiences.

With dozens of apps, influencers and trends (like the pictured blogpost by NerdWallet) enforcing the perspective that largely digital subscription programs are designed to take advantage of our absentmindedness, eCommerce brands need to do the work to break this stereotype for CPG and retail subscriptions.

Even the Federal Trade Commission (FTC) has guidelines and ongoing legal cases enforcing the narrative of intentional deception around subscriptions. So what can we do about it?

Transparency goes a long way - recent consumer research shows that customers are actually 20% more likely to purchase a product that’s priced transparently (meaning the seller breaks down the COGS, or Cost of Goods Sold). 

Communicating transparently about how your program handles disengaged subscriptions leans on the appeal of transparency and makes it clear to customers that if the subscription isn’t working for them, you won’t hold on longer than is respectful or necessary. 

Use transparent customer communication to position regular disengaged subscriptions clean-ups as a stronghold of customer trust and relationships. 

We’ll go through email and SMS communications in the next section, but it’s always a good idea to include your automatic cancellation policy within your subscription program landing page. Something as simple as the following addition to your landing page can start your customer relationships off on the right foot by reframing the idea of subscriptions.

In summary - be upfront with your customers about your disengaged cleanup efforts. Having a disengaged subscription only hurts your business and your customer’s routine - so help them avoid that at all costs!

How to create the optimal disengaged subscriptions cancellation flow with engagement opportunities

Like we discussed above, the ideal situation is to re-engage these subscribers prior to even having to clean up or cancel their disengaged subscriptions. 

We just learned how to position these cleanups as a reason to trust in your subscription program, rather than foster subscription anxiety. But some subscribers will inevitably skip over your subscription landing page.

So today we’ll not only talk about writing a strong cancellation email, but we’ll also get proactive and break down the ideal flow to talk to these subscribers even before they reach the 3 consecutive failed orders mark.

Pre-failed order: how to warn customers about upcoming card expiration dates

Talk about a head start! Like we emphasized in the last section, subscriptions are a win-win situation for you and your subscribers - so we should do everything we can to help them avoid a pesky missed order in the first place.

The credit card expiration warning email is available via our default Ordergroove transactional emails, and also available as a trigger through our Klaviyo and Attentive integrations.
Here’s a breakdown of a great credit card expiration warning email:

What to say to subscribers after their first and second consecutive failed orders

At this point, the subscription order will likely go through the Recovery Optimizer process, where our system will automatically apply a strategic cadence of retrying the payment type to maximize opportunities from updates like a top-up of funds in a card after a payday. If those recovery retries aren’t successful and the payment remains invalid or insufficient, their order will ultimately be rejected. (Most order failure reasons are retryable, but some aren’t. More on that process here!)

As a reminder, a subscription can have 2 consecutive rejected orders and still go through the retry flow - after its third consecutive rejection, the Disengaged Subscription Concierge will automatically cancel that subscription.

For merchants on Ordergroove default Transactional Emails: 

During the Recovery Optimizer process, they will by default receive emails for every retry placement depending on the original reason for placement failure. This reason is 1 of the 3 that trigger emails configured within your Subscriptions -> Emails platform area. Those triggers and their emails are: 

• Order not placed - CC Expired 
• Order not placed - CC issue
• Order not placed - Generic issue

Once the order retry process (Recovery Optimizer) has completed all attempts and the reason for order failure is still not resolved, the order will move into final rejection status and cancel that specific order, but not the entire subscription. 

On our default emails within Ordergroove, the same email will trigger throughout the Recovery Optimizer retry attempts and final rejection attempt/failure (depending on the failure reason, of course). 

We recommend styling and branding these emails in line with the rest of your program transactional emails. Here’s a quick breakdown of each order not placed email.

Order not placed - CC Expired

Order not placed - CC issue

Order not placed - Generic issue

For merchants on our Klaviyo v2 integration and Attentive integrations for Transactional Emails: 

During the Recovery Optimizer process, we’ll send the Order Retry-able Failure trigger through your Klaviyo or Attentive integration. This Retry-able trigger will send on every unsuccessful order placement attempt until the last one (at which point you’ll receive the Order Rejected trigger). 

You should write and brand these Retry-able Failure emails within the same guidelines outlined above in the default Ordergroove emails section - with CTAs to update necessary information, clear steps on how to resolve the order failure reason, and strong value propositions to enact engagement. One impactful differentiator here is our "retries" event property; that lets you know how many retry attempts have triggered to customize message urgency and what to expect for each reminder like in the below example:

Upon total order rejection, you’ll receive the Order Rejected trigger; at which point you can send subscribers a notification that this order has been canceled and will not be retried until their next frequency/shipping date. Order Rejected triggers will be sent with other data like a reject reason and reject code to help you tailor these messages to the reason the order was rejected.

You’ll want to heavily emphasize subscription benefits and action steps required here - enticing customers to take action and make the appropriate changes before their next order placement date.

Order rejected - CC expired

Order rejected - CC issue

Order rejected - Generic issue

Here’s the full list of information that we’ll send to Klaviyo through our integration.

Here’s the full list of information that we’ll send to Attentive through our integration.

How to write a strong cancellation email with easy to follow next steps for re-engagement

It’s time! Hopefully, one of the multiple re-engagement opportunities we outlined above worked and you’ve re-engaged your loyal subscriber. However, there will be cases where it’s not possible to engage a subscriber and get an updated payment before reaching a third consecutive rejected order. Here’s a breakdown of the best cancellation email to send to subscribers when canceling their disengaged subscription.

**Important: If sending this email through the Ordergroove default transactional emails, you will need to update the “log in” link within the body text of this email to the specific URL of your account login. You can find the email template and update that link here.

Winback campaigns: a chance to reunite

After a subscription is canceled for disengagement (or for any other reason, whether by the customer or a support agent), it’s always a good idea to re-engage them further down the line for the opportunity to return (and save on recurring orders!). 

We suggest automatically sending all disengaged subscriptions customers into a winback/reactivation flow (if using Klaviyo) or journey (if using Attentive) where you’ll re-engage them at a later time. Here’s our module on creating a compelling winback campaign. Bonus points if you use our 1-click reactivate functionality, available through our Klaviyo and Attentive integrations!

📝 Try it now!

• Make sure your Recovery Optimizer tool is turned on (we recommend auto-optimize, which balances the best likelihood of recovering revenue while minimizing chargebacks and fees) to maximize the potential of re-engaging a subscription before order rejection.
• Be transparent about your disengaged subscriptions cleanups on your subscription program landing page FAQs. Position regular disengaged subscriptions clean-ups as a stronghold of customer trust and relationships. 
• Ensure your credit card expiration warning email is branded and configured for optimal engagement. You can do this through either your default Ordergroove transactional emails, or through our Klaviyo or Attentive integrations. If you’re not sure which you’re using, please reach out to your Ordergroove CSM!
• If on Ordergroove transactional emails, ensure all three of the following emails are configured and styled for optimal re-engagement:
  • Order not placed - CC Expired 
  • Order not placed - CC issue
  • Order not placed - Generic issue
• If on our Attentive or Klaviyo integrations, configure flows or journeys to contain optimal language for re-engagement on initial Order Not Placed emails. 
• If unable to engage the customer through the retry flow, make sure the Order Rejected emails notify the customer that that order has been canceled and will require action to receive their product before their next order attempts to place.
• When creating a strong cancellation email, be sure to include a dynamic link to the customer account login, and emphasize subscription benefits and steps to update payment then reactivate their subscription.

Winback/Reactivation campaigns are a chance to reunite with disengaged customers. Send all disengaged cancellations into a delayed winback flow, following the guidelines in this module.