Software Growth

Cancellation flow

A cancellation flow is the sequence of screens after a customer clicks cancel, usually a reason survey followed by a pause, downgrade or discount offer.

A cancellation flow is what happens between "Cancel subscription" and the confirmation. A bare flow asks "Are you sure?" and cancels. A designed one asks why, offers an alternative that fits the answer, and records the reason. It does two jobs: it saves a share of the customers who would have left, and it gives you the data on why the rest left.

The usual parts

Paddle's Retain tool, formerly ProfitWell Retain, describes three elements:

  • Survey. The customer picks a reason for leaving and says what they valued.
  • Salvage attempt. Based on the answer, they are offered a pause (useful for seasonal businesses), a cheaper plan, or a way to contact support, with their survey answers passed along.
  • Salvage offer. If they decline, a final discount.

Stripe's customer portal supports the same idea. Its retention rules show an offer, a coupon or a lower-priced plan, targeted by cancellation reason, subscription tenure and total spend. One example in the docs gives customers who say "too expensive" and have subscribed for more than six months a 30% discount for three months.

How to measure it

If 100 customers start canceling in a month and 15 take a pause or a lower plan, the save rate is 15%. Then check whether the saved customers are still there 90 days later. A discount that only delays cancellation by one month gives you a good save rate and no extra retention.

Matching the offer to the reason

  • "Too expensive": a cheaper plan or a short discount.
  • "Not using it enough" or a seasonal pause: a pause for 1 to 3 months.
  • "Missing a feature": a note from you, since discounts will not fix that.
  • "Found an alternative": ask which one. This is some of your best competitive research.
  • "Don't need it anymore": let them go cleanly and add them to a later win-back list.

Common mistakes

  • Making cancellation hard to find or hiding the button. It breeds anger and chargebacks.
  • Discounting everyone. Customers learn that canceling gets a deal.
  • Collecting reasons and never reading them. Review the tagged list monthly.
  • Counting failed payments here. Those customers never reach the flow, which is why involuntary churn needs its own fix.

For small SaaS

Start with a single required question and a free-text box, with the customer still able to cancel in one more click. Ask one more thing: what would have kept you. With 20 cancellations a month you will see the top reasons in under two months, and that is worth more than a polished offer engine.

Sources

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