From subscription cancellations to goodwill and retention

Subscription fatigue is real. So is the growing demand (including regulatory!) for transparency and simplicity in how subscriptions are managed—especially when it comes to cancellations. What once felt like a minefield of hidden buttons or drawn-out processes is shifting toward ease, trust, and customer-first thinking. The reason? Both market forces and evolving legislation are steering the subscription economy toward fairness and respect for consumer choices.

A recent State of Subscriptions report shows that the subscription economy is maturing and that businesses must pivot from acquisition-focused models to retention-first strategies. Here are a few of the trends identified in the report:

● Acquisition rates have dropped from 4.1% in 2021 to 2.8% in 2024. It highlights the increased importance of retention strategies.
● Subscription pausing surged by 68% year-on-year, with digital media and entertainment experiencing a whopping 330% increase. That said, pause options retain 51.7% of at-risk customers
● Returning subscribers made up 20% of acquisitions in 2024. Reactivation campaigns are critical.

On the legislative side, recent US legislation mandates that cancelling a subscription should be as easy as signing up (read the announcement of the FTC’s final “Click-to-Cancel” legislation here). Similar regulations are expected in the UK, and others will no doubt follow suit. While such legislation may seem like a win for consumers and a loss for businesses, it doesn’t have to be. Customer-first strategies build goodwill, with cancelled subscribers who leave on good terms far more likely to return.

Why Subscribers Leave—and What You Can Do About It
Why do subscribers cancel? It seems obvious, but often, it’s because they’re not getting the expected value. They may not use the product often enough (not creating a habit). Perhaps the on-boarding was poor. It could just be financial pressure. Whichever it is, understanding the triggers—and addressing them early—is key to reducing churn.

Consider this: customers who stop using your product are waving a red flag. Disengagement almost always precedes cancellation. If you’re monitoring subscriber behaviour, you’ll notice the signs. Reduced app opens. Fewer visits to your site. Lower interaction with your emails.

There are moments in the customer lifecycle when you should act and re-engage before they hit the cancellation button.

The Shift from “Hiding” to Helping
How often have you—or friends or colleagues—complained about how difficult some brands make cancellations? Outdated tactics like hiding buttons or removing phone numbers from your website are not only frustrating—they’re damaging to your brand.

Customers value transparency and honesty. When you make it hard for them to unsubscribe, they know you are trying to trap them. That doesn’t endear you to them. It makes them more unlikely to return.

Old approaches to cancellations are not just outdated. They’re a mistake. Today’s subscribers value honesty. They know when you’re trying to trap them. It’s off-putting, damaging brand relationships.

What should you do? Make cancellation and reactivation frictionless. Netflix, for example, makes reactivation seamless by storing details for easy re-registration. Audible uses engagement tactics like loss aversion (“You’ll lose access to the Plus Catalogue”) and pause options to retain customers. One global consumer publisher’s “friendly friction” approach—offering personalised retention offers at the moment of cancellation—has cut their churn rate significantly.

Pausing: A Powerful Alternative
Pausing subscriptions is one of the best ways to keep customers in your ecosystem. It’s ideal for subscribers who still like your product but need a temporary break—maybe due to financial pressures or seasonal shifts. By offering a pause option, you lower churn and make it easier for customers to return when ready. It builds on emotional drivers such as empathy, goodwill and trust.

Subscription experts suggest that this strategy works best with incentives. Offer discounts for reactivation. Keep paused subscribers engaged with updates and value-driven communication. Think of it as maintaining a warm relationship rather than saying goodbye entirely.

Reactivation as the New Metric
Subscription churn is often treated as an ultimate enemy. But there’s another metric that matters just as much: reactivation. Streaming services like Netflix lead the way, recognising that subscribers often come and go depending on their interests and needs. A frictionless path back is critical.

Ask yourself: how easy is it for a past subscriber to return? Are you holding their payment details securely? Do you offer reactivation perks like exclusive content or discounts? These small steps can make a big difference.

As Abi Spooner, Strategy Partner at Atlas, points out, retaining a customer is always cheaper than finding a new one. “Building customer relationships is crucial – delivering on your commitments to your customers will help to avoid cancellations. If customers do leave, that’s your opportunity to remind them what they’re missing.

“Customers don’t want to be ‘trapped’ by subscriptions. Make your cancellation process straightforward. Customers will be more likely to return when they’re ready to re-engage. If it was hard to cancel, they’re less likely to re-subscribe.

“There’s so much focus on streaming company churn, but perhaps it’s not churn metrics that need to be observed but reactivation!”

Subscription Fatigue and the “Essential” Test
Let’s not ignore the elephant in the room. Subscription fatigue is hitting hard. Consumers are overwhelmed with options and often looking to trim the fat. Banks and payment apps now make it easier than ever to cancel recurring payments. In this environment, your product needs to pass the “essential” test: does it deliver so much value that subscribers can’t imagine life without it?

The answer lies in understanding your customers deeply. Use data to see what’s working and what’s not. Offer flexible pricing or modular tiers to cater to varying budgets. Stay relevant.

Show your subscribers how your product fits into their lives and solves their problems. And if customers still want to pause or cancel their subscription after all of that, make it easy for them.

Turning Cancellations into Opportunities
Cancellations aren’t the end of the relationship with your customers. They’re an opportunity to show them that your brand is fair, respectful, and worth returning to.

● Embrace transparency.
● Offer flexibility.
● Focus on reactivation.

This will help reduce churn and increase long-term customer lifetime value built on stronger, more lasting relationships.

Subscriptions aren’t about locking customers by making it hard for them to leave. It’s about offering genuine value and earning their loyalty.

Again and again.

Re-cap: Practical Steps for Better Subscriber Relationships
Here is a re-cap with some practical steps you can implement to reduce cancellations, strengthen retention and encourage renewed engagement where a subscriber was lost.

1. Simplify the Process: Friction damages relationships. Transparency builds trust. Streamline the cancellation process with clear instructions and easily accessible options.
   Consider actions such as:
   ○ Introducing frictionless cancellation processes that prioritise customer experience.
   ○ Offering retention incentives during the cancellation flow to remind subscribers of your product’s value.
   ○ Creating re-engagement strategies post-cancellation to encourage a return.
   
2. Engage Early: Identify potential churn risks before they escalate. AI-driven tools can detect changes in subscriber behaviour, such as reduced usage or interactions, enabling timely interventions.
   Consider actions such as:
   ○ Using predictive analytics to identify at-risk subscribers.
   ○ Implementing personalised messaging campaigns that highlight relevant features or updates.
   ○ Adding meaningful perks (even if small) to re-engage disengaged users.
   
3. Offer Pausing Options: Flexibility matters. Many customers cancel not out of dissatisfaction but due to temporary circumstances. Providing a pause option allows them to return without the hassle of re-subscribing.
   Consider actions such as:
   ○ Offering pause durations tailored to customer needs.
   ○ Keeping paused subscribers engaged with occasional updates or exclusive offers.
   ○ Encouraging a smooth transition back to active status with added incentives.
   
4. Focus on Reactivation: Make it effortless for lapsed subscribers to return. Retention strategies of current subscribers don’t stop at cancellation; they extend to reactivation.
   Consider actions such as:
   ○ Sending tailored offers to former subscribers, such as access to new features or reduced rates.
   ○ Leveraging stored payment and other details to streamline the reactivation process.
   ○ Sharing reminders of what subscribers enjoyed previously, reinforced by social proof.
   
5. Personalise Retention Offers: Every cancellation has a story. Customise your retention efforts to address specific reasons subscribers leave.
   Consider actions such as:
   ○ Offering tiered pricing or modular options for price-sensitive customers.
   ○ Providing alternative packages for those whose needs have shifted.
   ○ Highlighting loss aversion by reminding users of features they’ll lose access to.

Cobus Heyl

Hely is a Content Partner at Atlas and Founder of That Coalition, a fractional event services and content provider.

Hely has worked with third-party clients such as Chartbeat, Lineup Systems, and Tubular Labs in Europe and the US, Prospect in the UK, and industry bodies such as PRCA (Communications and Public Affairs) in the UK, MVFP (German Publishers Association) and the Association of Indian Media (AIM).

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