Why a SaaS Customer Hasn’t Truly Churned After They Cancel: How To Win Back Churned Customers

From our research, you can win back up to 34% of customers who cancelled your product. Here’s how you can leverage this huge opportunity to expand revenue.

Wrap your head around this: even if a customer decides to cancel it doesn’t mean that they’ve churned permanently. All of this centers around the concept of reactivations: winning back customers who cancelled with targeted campaigns.


We'll cover:

  • common reasons behind cancellations
  • why a subscription customer hasn’t churned when they cancel
  • how to use win-back campaigns to re-engage former customers
  • how Churnkey can make winning back customers easier than ever with Reactivations

What are the most common reasons for cancellations?

When a customer decides to cancel a subscription, it's easy to jump to conclusions and assume the worst–that the customer is lost forever. But the fact is that there are a few common reasons why customers cancel. And when we understand them, it makes it easier for us to potentially offer a solution that can re-engage the customer. 

This section assumes that you’re collecting cancellation reasons at the point of cancellation. If you’re not, it’s a good idea to set up cancellation/exit surveys or—if you want to be even more effective with retention efforts—cancellation flows to harvest this useful data.

Temporary issues

A cancelled subscription doesn't always signify a permanent departure. Customers might be need to hit the pause button due to budget constraints, changing business priorities, being a seasonal business, or a temporary shift in needs. This is also why it’s incredibly important to offer customers the option to pause their subscription. Having this option automates the process of subscription reactivation.

Perceived value

Customers may cancel their subscription if they perceive a misalignment between the value offered and the price paid. This doesn't necessarily mean your product is lacking; it could be a matter of effective communication or showcasing features that align more closely with their evolving needs.

Onboarding hurdles

Sometimes customers cancel because they haven't fully grasped the breadth and depth of your product's capabilities. It could be a user adoption issue rather than a flaw in your product. Identifying and addressing these hurdles is crucial for retention, and it happens during onboarding. It’s vital to provide new customers with all of the education and support they need to onboard successfully.

Missing functionality

Your product simply may not have had what a customer needed at the time. And just because you have a checkmark on that line item in the feature grid doesn’t mean that the way your product works is fulfilling the need.

Competitive pressure

New products come and go as customer needs, technology, and hard costs change. Competitors who steal your customers may have a different way of solving the problem, be priced for unique use cases, or win on the experience. Understanding why people leave you and where they’re going is an essential bit of data to capture.

How is it possible that a Saas customer hasn’t churned when they cancel?

No matter what reason a customer had for cancelling, it’s important to keep one fact front-of-mind: they signed up for your product for a reason. They used it. Incorporated some of it into their life or their workflow.

In some cases (based on our research, up to 34% of your previously-cancelled customers), there’s a way you can win them back. So let’s start re-framing the way you view “cancelled” customers: they’re not necessarily all churned. They’re definitely an opportunity for expanding revenue.

Here’s why a SaaS customer hasn’t churned when they cancel.

Customer loyalty is a long game

Customer loyalty—and, correspondingly, healthy LTV or ACV stats—won’t always provide instant gratification. So it’s important to think about some bucket of your cancelled subscribers as strategic retreats rather than full-scale surrender.

Try engaging with cancelled customers through ongoing, personalized communications. You can showcase product updates, improvements, and success stories that highlight the value they might be missing. The goal is to provide them with compelling reasons to reconsider their decision.

The feedback you gather at cancellation is golden;

A tight, connected loop from cancellation → feedback analysis → messaging strategy → reactivation operations can potentially create an extremely performant revenue boost. Past customers who believe you can still speak to their needs will be more likely to reconsider returning home to you.

Analysis of your exit data isn’t enough. You need to use this data to identify recurring themes and pain points, then use it to inform product enhancements and messaging. Only then will your reactivation campaigns have any hope of winning.

Understand that subscription fatigue is real

We’re in an age of abundance, and we’re bombarded with choices. Subscription fatigue is real, despite the fact that the Subscription Economy is set to continue growing. With this in mind, a cancelled subscription might be a customer's way of decluttering, not necessarily a rejection of your product.

Keep in mind that evolving needs require agile solutions

Business landscapes evolve, and so do customer needs. What was once a perfect fit may no longer align with a customer's current goals. Rather than viewing cancellations as losses, consider them as signals that your customers are dynamic entities with evolving needs.

Regularly reassess your customer personas and conduct market research to stay attuned to industry trends. Focus on positioning your SaaS product as an agile solution that grows with the customer.

How do you win back customers who have cancelled?

How do you actually re-engage customers who have cancelled? How do you stop cancellations from becoming true churn? Here are the strategies you can use to win back cancelled customers.

Use your cancellation survey data to improve what your product is missing

Losing customers to a competitor? A key feature not working as intended? Major outage affect customer data? Address the problems your product has head-on. This provides you currency with old customers that you’ll use later.

Create segments of receptive customers from this data

Analyze your cancellation survey data and create segments of customers who you think will be most receptive to hearing from you again. This is also a chance to remove obvious detractors or disappointed parties from consideration. Did someone dispute your charges? Leave an all-caps rant in your support inbox? Probably best to filter them out.

But if you’ve got segments of customers who you think would be receptive to hearing from you again—especially after you have improvements to bring them—this is where opportunity lies.

Craft your reactivation campaigns

While they’re simple in concept, crafting successful campaigns can be an art form. You have to leverage customer data to tailor your message to the specific reasons behind the cancellation. You can then showcase product updates, new features, or pricing adjustments that directly address their concerns.

The goal: rekindle that flame, speak directly and plainly, and personalize as much as you can.

Provide tailored offers and incentives

Consider offering tailored incentives to entice cancelled customers back into the fold. This could include limited-time discounts, extended trial periods, or exclusive access to premium features. By sweetening the deal, you demonstrate your commitment to customer satisfaction and provide a tangible reason for them to reconsider.

Remember that the key to re-engaging customers with incentives is by creating offers that have a temporary shelf life. You want to instill a sense of urgency. So put an expiration date on your offer — say, 48 or 72 hours from the time of delivery.

You can reactivate cancelled customers with Churnkey 

Reactivation campaigns can be incredibly effective when it comes to re-engaging lapsed customers. Research has actually shown that 45% of customers who receive a win-back email will open subsequent emails from your company. But executing an effective winback campaign can be complicated—it requires the coordination of an email campaign (Marketing team), customer data to personalize every email (Data team), billing data (Finance team), offer creation, and one-click reactivation (Product and Engineering teams).

Churnkey Reactivations takes advantage of the data your company has across the Churnkey platform, allowing you to send targeted winback campaigns by targeting cancellation reasons, customer sentiment, whether they cancelled due to failed payments, and so much more. And to make things as frictionless as possible for both you and your customers, Reactivations provides you the ability to offer one-click subscription reactivations. 

Sound helpful? Check us out to see how Churnkey helps SaaS businesses reduce churn and retain more customers.