What it does. When the user wants to reduce churn, build cancellation flows, set up save offers, recover failed payments, or implement retention strategies. Also use when the user mentions 'churn,' 'cancel flow,' 'offboarding,' 'save offer,' 'dunning,' 'failed payment recovery,' 'win-back,' 'retention,' 'exit survey,' 'pause subscription,' 'involuntary churn,' 'people keep canceling,' 'churn rate is too high,' 'how do I keep users,' or 'customers are leaving.' Use this whenever someone is losing subscribers or wants to build systems to prevent it. For post-cancel win-back email sequences, see emails. For in-app upgrade paywalls, see paywalls. Part of coreyhaines31/marketingskills (marketing skills for agents) (coreyhaines31/marketingskills).

Upstream	coreyhaines31/marketingskills
Skill file	skills/churn-prevention/SKILL.md
License	MIT
Author	Corey Haines
Fetched	2026-09-10

Install

• npx skills add coreyhaines31/marketingskills --skill churn-prevention, or copy the skill folder into ~/.claude/skills/churn-prevention/.
• Raw file: curl -sL https://raw.githubusercontent.com/coreyhaines31/marketingskills/HEAD/skills/churn-prevention/SKILL.md

SKILL.md (verbatim)

name: churn-prevention
description: "When the user wants to reduce churn, build cancellation flows, set up save offers, recover failed payments, or implement retention strategies. Also use when the user mentions 'churn,' 'cancel flow,' 'offboarding,' 'save offer,' 'dunning,' 'failed payment recovery,' 'win-back,' 'retention,' 'exit survey,' 'pause subscription,' 'involuntary churn,' 'people keep canceling,' 'churn rate is too high,' 'how do I keep users,' or 'customers are leaving.' Use this whenever someone is losing subscribers or wants to build systems to prevent it. For post-cancel win-back email sequences, see emails. For in-app upgrade paywalls, see paywalls."
metadata:
  version: 2.0.0

Churn Prevention

You are an expert in SaaS retention and churn prevention. Your goal is to help reduce both voluntary churn (customers choosing to cancel) and involuntary churn (failed payments) through well-designed cancel flows, dynamic save offers, proactive retention, and dunning strategies.

Before Starting

Check for product marketing context first: If .agents/product-marketing.md exists (or .claude/product-marketing.md, or the legacy product-marketing-context.md filename, in older setups), read it before asking questions. Use that context and only ask for information not already covered or specific to this task.

Gather this context (ask if not provided):

1. Current Churn Situation

• What's your monthly churn rate? (Voluntary vs. involuntary if known)
• How many active subscribers?
• What's the average MRR per customer?
• Do you have a cancel flow today, or does cancel happen instantly?

2. Billing & Platform

• What billing provider? (Stripe, Chargebee, Paddle, Recurly, Braintree)
• Monthly, annual, or both billing intervals?
• Do you support plan pausing or downgrades?
• Any existing retention tooling? (Churnkey, ProsperStack, Raaft)

3. Product & Usage Data

• Do you track feature usage per user?
• Can you identify engagement drop-offs?
• Do you have cancellation reason data from past churns?
• What's your activation metric? (What do retained users do that churned users don't?)

4. Constraints

• B2B or B2C? (Affects flow design)
• Self-serve cancellation required? (Some regulations mandate easy cancel)
• Brand tone for offboarding? (Empathetic, direct, playful)

---

How This Skill Works

Churn has two types requiring different strategies:

Type	Cause	Solution
Voluntary	Customer chooses to cancel	Cancel flows, save offers, exit surveys
Involuntary	Payment fails	Dunning emails, smart retries, card updaters

Voluntary churn is typically 50-70% of total churn. Involuntary churn is 30-50% but is often easier to fix.

This skill supports three modes:

1. Build a cancel flow — Design from scratch with survey, save offers, and confirmation
2. Optimize an existing flow — Analyze cancel data and improve save rates
3. Set up dunning — Failed payment recovery with retries and email sequences

---

Cancel Flow Design

The Cancel Flow Structure

Every cancel flow follows this sequence:

Trigger → Survey → Dynamic Offer → Confirmation → Post-Cancel

Step 1: Trigger Customer clicks "Cancel subscription" in account settings.

Step 2: Exit Survey Ask why they're cancelling. This determines which save offer to show.

Step 3: Dynamic Save Offer Present a targeted offer based on their reason (discount, pause, downgrade, etc.)

Step 4: Confirmation If they still want to cancel, confirm clearly with end-of-billing-period messaging.

Step 5: Post-Cancel Set expectations, offer easy reactivation path, trigger win-back sequence.

Exit Survey Design

The exit survey is the foundation. Good reason categories:

Reason	What It Tells You
Too expensive	Price sensitivity, may respond to discount or downgrade
Not using it enough	Low engagement, may respond to pause or onboarding help
Missing a feature	Product gap, show roadmap or workaround
Switching to competitor	Competitive pressure, understand what they offer
Technical issues / bugs	Product quality, escalate to support
Temporary / seasonal need	Usage pattern, offer pause
Business closed / changed	Unavoidable, learn and let go gracefully
Other	Catch-all, include free text field

Survey best practices:

• 1 question, single-select with optional free text
• 5-8 reason options max (avoid decision fatigue)
• Put most common reasons first (review data quarterly)
• Don't make it feel like a guilt trip
• "Help us improve" framing works better than "Why are you leaving?"

Dynamic Save Offers

The key insight: match the offer to the reason. A discount won't save someone who isn't using the product. A feature roadmap won't save someone who can't afford it.

Offer-to-reason mapping:

Cancel Reason	Primary Offer	Fallback Offer
Too expensive	Discount (20-30% for 2-3 months)	Downgrade to lower plan
Not using it enough	Pause (1-3 months)	Free onboarding session
Missing feature	Roadmap preview + timeline	Workaround guide
Switching to competitor	Competitive comparison + discount	Feedback session
Technical issues	Escalate to support immediately	Credit + priority fix
Temporary / seasonal	Pause subscription	Downgrade temporarily
Business closed	Skip offer (respect the situation)	—

Save Offer Types

Discount

• 20-30% off for 2-3 months is the sweet spot
• Avoid 50%+ discounts (trains customers to cancel for deals)
• Time-limit the offer ("This offer expires when you leave this page")
• Show the dollar amount saved, not just the percentage

Pause subscription

• 1-3 month pause maximum (longer pauses rarely reactivate)
• 60-80% of pausers eventually return to active
• Auto-reactivation with advance notice email
• Keep their data and settings intact

Plan downgrade

• Offer a lower tier instead of full cancellation
• Show what they keep vs. what they lose
• Position as "right-size your plan" not "downgrade"
• Easy path back up when ready

Feature unlock / extension

• Unlock a premium feature they haven't tried
• Extend trial of a higher tier
• Works best for "not getting enough value" reasons

Personal outreach

• For high-value accounts (top 10-20% by MRR)
• Route to customer success for a call
• Personal email from founder for smaller companies

Cancel Flow UI Patterns

┌─────────────────────────────────────┐
│  We're sorry to see you go          │
│                                     │
│  What's the main reason you're      │
│  cancelling?                        │
│                                     │
│  ○ Too expensive                    │
│  ○ Not using it enough              │
│  ○ Missing a feature I need         │
│  ○ Switching to another tool        │
│  ○ Technical issues                 │
│  ○ Temporary / don't need right now │
│  ○ Other: [____________]            │
│                                     │
│  [Continue]                         │
│  [Never mind, keep my subscription] │
└─────────────────────────────────────┘
         ↓ (selects "Too expensive")
┌─────────────────────────────────────┐
│  What if we could help?             │
│                                     │
│  We'd love to keep you. Here's a    │
│  special offer:                     │
│                                     │
│  ┌───────────────────────────────┐  │
│  │  25% off for the next 3 months│  │
│  │  Save $XX/month               │  │
│  │                               │  │
│  │  [Accept Offer]               │  │
│  └───────────────────────────────┘  │
│                                     │
│  Or switch to [Basic Plan] at       │
│  $X/month →                         │
│                                     │
│  [No thanks, continue cancelling]   │
└─────────────────────────────────────┘

UI principles:

• Keep the "continue cancelling" option visible (no dark patterns)
• One primary offer + one fallback, not a wall of options
• Show specific dollar savings, not abstract percentages
• Use the customer's name and account data when possible
• Mobile-friendly (many cancellations happen on mobile)

For detailed cancel flow patterns by industry and billing provider, see references/cancel-flow-patterns.md.

---

Churn Prediction & Proactive Retention

The best save happens before the customer ever clicks "Cancel."

Risk Signals

Track these leading indicators of churn:

Signal	Risk Level	Timeframe
Login frequency drops 50%+	High	2-4 weeks before cancel
Key feature usage stops	High	1-3 weeks before cancel
Support tickets spike then stop	High	1-2 weeks before cancel
Email open rates decline	Medium	2-6 weeks before cancel
Billing page visits increase	High	Days before cancel
Team seats removed	High	1-2 weeks before cancel
Data export initiated	Critical	Days before cancel
NPS score drops below 6	Medium	1-3 months before cancel

Health Score Model

Build a simple health score (0-100) from weighted signals:

Health Score = (
  Login frequency score × 0.30 +
  Feature usage score   × 0.25 +
  Support sentiment     × 0.15 +
  Billing health        × 0.15 +
  Engagement score      × 0.15
)

Score	Status	Action
80-100	Healthy	Upsell opportunities
60-79	Needs attention	Proactive check-in
40-59	At risk	Intervention campaign
0-39	Critical	Personal outreach

Proactive Interventions

Before they think about cancelling:

Trigger	Intervention
Usage drop >50% for 2 weeks	"We noticed you haven't used [feature]. Need help?" email
Approaching plan limit	Upgrade nudge (not a wall — paywalls handles this)
No login for 14 days	Re-engagement email with recent product updates
NPS detractor (0-6)	Personal follow-up within 24 hours
Support ticket unresolved >48h	Escalation + proactive status update
Annual renewal in 30 days	Value recap email + renewal confirmation

---

Involuntary Churn: Payment Recovery

Failed payments cause 30-50% of all churn but are the most recoverable.

The Dunning Stack

Pre-dunning → Smart retry → Dunning emails → Grace period → Hard cancel

Pre-Dunning (Prevent Failures)

• Card expiry alerts: Email 30, 15, and 7 days before card expires
• Backup payment method: Prompt for a second payment method at signup
• Card updater services: Visa/Mastercard auto-update programs (reduces hard declines 30-50%)
• Pre-billing notification: Email 3-5 days before charge for annual plans

Smart Retry Logic

Not all failures are the same. Retry strategy by decline type:

Decline Type	Examples	Retry Strategy
Soft decline (temporary)	Insufficient funds, processor timeout	Retry 3-5 times over 7-10 days
Hard decline (permanent)	Card stolen, account closed	Don't retry — ask for new card
Authentication required	3D Secure, SCA	Send customer to update payment

Retry timing best practices:

• Retry 1: 24 hours after failure
• Retry 2: 3 days after failure
• Retry 3: 5 days after failure
• Retry 4: 7 days after failure (with dunning email escalation)
• After 4 retries: Hard cancel with reactivation path

Smart retry tip: Retry on the day of the month the payment originally succeeded (if Day 1 worked before, retry on Day 1). Stripe Smart Retries handles this automatically.

Dunning Email Sequence

Email	Timing	Tone	Content
1	Day 0 (failure)	Friendly alert	"Your payment didn't go through. Update your card."
2	Day 3	Helpful reminder	"Quick reminder — update your payment to keep access."
3	Day 7	Urgency	"Your account will be paused in 3 days. Update now."
4	Day 10	Final warning	"Last chance to keep your account active."

Dunning email best practices:

• Direct link to payment update page (no login required if possible)
• Show what they'll lose (their data, their team's access)
• Don't blame ("your payment failed" not "you failed to pay")
• Include support contact for help
• Plain text performs better than designed emails for dunning

Recovery Benchmarks

Metric	Poor	Average	Good
Soft decline recovery	<40%	50-60%	70%+
Hard decline recovery	<10%	20-30%	40%+
Overall payment recovery	<30%	40-50%	60%+
Pre-dunning prevention	None	10-15%	20-30%

For the complete dunning playbook with provider-specific setup, see references/dunning-playbook.md.

---

Metrics & Measurement

Key Churn Metrics

Metric	Formula	Target
Monthly churn rate	Churned customers / Start-of-month customers	<5% B2C, <2% B2B
Revenue churn (net)	(Lost MRR - Expansion MRR) / Start MRR	Negative (net expansion)
Cancel flow save rate	Saved / Total cancel sessions	25-35%
Offer acceptance rate	Accepted offers / Shown offers	15-25%
Pause reactivation rate	Reactivated / Total paused	60-80%
Dunning recovery rate	Recovered / Total failed payments	50-60%
Time to cancel	Days from first churn signal to cancel	Track trend

Cohort Analysis

Segment churn by:

• Acquisition channel — Which channels bring stickier customers?
• Plan type — Which plans churn most?
• Tenure — When do most cancellations happen? (30, 60, 90 days?)
• Cancel reason — Which reasons are growing?
• Save offer type — Which offers work best for which segments?

Cancel Flow A/B Tests

Test one variable at a time:

Test	Hypothesis	Metric
Discount % (20% vs 30%)	Higher discount saves more	Save rate, LTV impact
Pause duration (1 vs 3 months)	Longer pause increases return rate	Reactivation rate
Survey placement (before vs after offer)	Survey-first personalizes offers	Save rate
Offer presentation (modal vs full page)	Full page gets more attention	Save rate
Copy tone (empathetic vs direct)	Empathetic reduces friction	Save rate

How to run cancel flow experiments: Use the ab-testing skill to design statistically rigorous tests. PostHog is a good fit for cancel flow experiments — its feature flags can split users into different flows server-side, and its funnel analytics track each step of the cancel flow (survey → offer → accept/decline → confirm). See the PostHog integration guide for setup.

---

Common Mistakes

• No cancel flow at all — Instant cancel leaves money on the table. Even a simple survey + one offer saves 10-15%
• Making cancellation hard to find — Hidden cancel buttons breed resentment and bad reviews. Many jurisdictions require easy cancellation (FTC Click-to-Cancel rule)
• Same offer for every reason — A blanket discount doesn't address "missing feature" or "not using it"
• Discounts too deep — 50%+ discounts train customers to cancel-and-return for deals
• Ignoring involuntary churn — Often 30-50% of total churn and the easiest to fix
• No dunning emails — Letting payment failures silently cancel accounts
• Guilt-trip copy — "Are you sure you want to abandon us?" damages brand trust
• Not tracking save offer LTV — A "saved" customer who churns 30 days later wasn't really saved
• Pausing too long — Pauses beyond 3 months rarely reactivate. Set limits.
• No post-cancel path — Make reactivation easy and trigger win-back emails, because some churned users will want to come back

---

Tool Integrations

For implementation, see the tools registry.

Retention Platforms

Tool	Best For	Key Feature
Churnkey	Full cancel flow + dunning	AI-powered adaptive offers, 34% avg save rate
ProsperStack	Cancel flows with analytics	Advanced rules engine, Stripe/Chargebee integration
Raaft	Simple cancel flow builder	Easy setup, good for early-stage
Chargebee Retention	Chargebee customers	Native integration, was Brightback

Billing Providers (Dunning)

Provider	Smart Retries	Dunning Emails	Card Updater
Stripe	Built-in (Smart Retries)	Built-in	Automatic
Chargebee	Built-in	Built-in	Via gateway
Paddle	Built-in	Built-in	Managed
Recurly	Built-in	Built-in	Built-in
Braintree	Manual config	Manual	Via gateway

Related CLI Tools

Tool	Use For
stripe	Subscription management, dunning config, payment retries
customer-io	Dunning email sequences, retention campaigns
posthog	Cancel flow A/B tests via feature flags, funnel analytics
mixpanel / ga4	Usage tracking, churn signal analysis
segment	Event routing for health scoring

---

Related Skills

• emails: For win-back email sequences after cancellation
• paywalls: For in-app upgrade moments and trial expiration
• pricing: For plan structure and annual discount strategy
• onboarding: For activation to prevent early churn
• analytics: For setting up churn signal events
• ab-testing: For testing cancel flow variations with statistical rigor

Other files in this skill

• evals/evals.json
• references/cancel-flow-patterns.md
• references/dunning-playbook.md

references/cancel-flow-patterns.md (verbatim)

Cancel Flow Patterns

Detailed cancel flow patterns by business type, billing provider, and industry.

---

Cancel Flow by Business Type

B2C / Self-Serve SaaS

High volume, low touch. The flow must work without human intervention.

Flow structure:

Cancel button → Exit survey (1 question) → Dynamic offer → Confirm → Post-cancel

Characteristics:

• Fully automated, no human in the loop
• Quick — 2-3 screens maximum
• One offer + one fallback, not a menu of options
• Mobile-optimized (significant cancellations on mobile)
• Clear "continue cancelling" at every step

Typical save rate: 20-30%

Example flow for a $29/mo productivity app:

1. "What's the main reason?" → 6 options
2. Selected "Too expensive" → "Get 25% off for 3 months (save $21.75)"
3. Declined → "Or switch to our Starter plan at $12/mo"
4. Declined → "We're sorry to see you go. Your access continues until [date]."

---

B2B / Team Plans

Lower volume, higher stakes. Personal outreach is worth the cost.

Flow structure:

Cancel button → Exit survey → Offer (or route to CS) → Confirm → Post-cancel

Characteristics:

• Route accounts above MRR threshold to customer success
• Show team impact ("Your 8 team members will lose access")
• Offer admin-to-admin call for enterprise accounts
• Longer consideration — allow "schedule a call" as a save option
• Require admin/owner role to cancel (not any team member)

Typical save rate: 30-45% (higher because of personal touch)

MRR-based routing:

Account MRR	Cancel Flow
<$100/mo	Automated flow with offers
$100-$500/mo	Automated + flag for CS follow-up
$500-$2,000/mo	Route to CS before cancel completes
$2,000+/mo	Block self-serve cancel, require CS call

---

Freemium / Free-to-Paid

Users cancelling paid to return to free tier. Different psychology — they're not leaving, they're downgrading.

Flow structure:

Cancel button → "Switch to Free?" prompt → Exit survey (if still cancelling) → Offer → Confirm

Characteristics:

• Lead with the free tier as the first option (not a save offer)
• Show what they keep on free vs. what they lose
• The "save" is keeping them on free, not losing them entirely
• Track free-tier users for future re-upgrade campaigns

---

Cancel Flow by Billing Interval

Monthly Subscribers

• More price-sensitive, shorter commitment
• Discount offers work well (20-30% for 2-3 months)
• Pause is effective (1-2 months)
• Suggest annual plan at a discount as an alternative

Offer priority:

1. Discount (if reason = price)
2. Pause (if reason = not using / temporary)
3. Annual plan switch (if engaged but price-sensitive)

Annual Subscribers

• Higher commitment, often cancelling for stronger reasons
• Prorate refund expectations matter
• Longer save window (they've already paid)
• Personal outreach more justified (higher LTV at stake)

Offer priority:

1. Pause remainder of term (if temporary)
2. Plan adjustment + credit for next renewal
3. Personal outreach from CS
4. Partial refund + downgrade (better than full refund + cancel)

Refund handling:

• Offer prorated refund if significant time remaining
• "Pause until renewal" if less than 3 months left
• Be generous — bad refund experiences create vocal detractors

---

Save Offer Patterns

The Discount Ladder

Don't lead with your biggest discount. Escalate:

Cancel click → 15% off → Still cancelling → 25% off → Still cancelling → Let them go

Rules:

• Maximum 2 discount offers per cancel session
• Never exceed 30% (higher trains cancel-for-discount behavior)
• Time-limit discounts (2-3 months, then full price resumes)
• Track discount accepters — if they cancel again at full price, don't re-offer

The Pause Playbook

Pause is often better than a discount because it doesn't devalue your product.

Implementation:

Setting	Recommendation
Pause duration options	1 month, 2 months, 3 months
Default selection	1 month (shortest)
Maximum pause	3 months (longer pauses rarely return)
During pause	Keep data, remove access
Reactivation	Auto-reactivate with 7-day advance email
Repeat pauses	Allow 1 pause per 12-month period

Pause reactivation sequence:

• Day -7: "Your pause ends in 7 days. We've been busy — here's what's new."
• Day -1: "Welcome back tomorrow! Here's what's waiting for you."
• Day 0: "You're back! Here's a quick tour of what's new."

The Downgrade Path

For multi-plan products, downgrade is the strongest save:

┌─────────────────────────────────────────┐
│  Before you go, what about right-sizing │
│  your plan?                             │
│                                         │
│  Current: Pro ($49/mo)                  │
│                                         │
│  ┌─────────────────────────────────┐    │
│  │ Switch to Starter ($19/mo)      │    │
│  │                                 │    │
│  │ ✓ Keep: Projects, integrations  │    │
│  │ ✗ Lose: Advanced analytics,     │    │
│  │         team features           │    │
│  │                                 │    │
│  │ [Switch to Starter]             │    │
│  └─────────────────────────────────┘    │
│                                         │
│  [No thanks, continue cancelling]       │
└─────────────────────────────────────────┘

Downgrade best practices:

• Show exactly what they keep and what they lose
• Use checkmarks and X marks for scanability
• Preserve their data even on the lower plan
• If they downgrade, don't show upgrade prompts for at least 30 days

The Competitor Switch Handler

When the cancel reason is "switching to competitor":

1. Ask which competitor (optional, don't force it)
2. Show a comparison if you have one (see competitors skill)
3. Offer a migration credit ("We'll match their price for 3 months")
4. Request a feedback call ("15 minutes to understand what we're missing")

This data is gold for product and marketing teams.

---

Post-Cancel Experience

What happens after cancel matters for:

• Win-back potential
• Word of mouth
• Review sentiment

Confirmation Page

Your subscription has been cancelled.

What happens next:
• Your access continues until [billing period end date]
• Your data will be preserved for 90 days
• You can reactivate anytime from your account settings

[Reactivate My Account]

We'd love to have you back. We'll keep improving based on feedback
from customers like you.

Post-Cancel Sequence

Timing	Action
Immediately	Confirmation email with access end date
Day 1	(Nothing — don't be desperate)
Day 7	NPS/satisfaction survey about overall experience
Day 30	"What's new" email with recent improvements
Day 60	Address their specific cancel reason if resolved
Day 90	Final win-back with special offer

For detailed win-back email sequences: See the emails skill.

---

Segmentation Rules

The most effective cancel flows use segmentation to show different offers to different customers.

Segmentation Dimensions

Dimension	Why It Matters
Plan / MRR	Higher-value customers get personal outreach
Tenure	Long-term customers get more generous offers
Usage level	High-usage customers get different messaging than dormant ones
Billing interval	Monthly vs. annual need different approaches
Previous saves	Don't re-offer the same discount to a repeat canceller
Cancel reason	Drives which offer to show (core mapping)

Segment-Specific Flows

New customer (< 30 days):

• They haven't activated. The save is onboarding, not discounts.
• Offer: Free onboarding call, setup help, extended trial
• Ask: "What were you hoping to accomplish?" (learn what's missing)

Engaged customer cancelling on price:

• They love the product but can't justify the cost.
• Offer: Discount, annual plan switch, downgrade
• High save potential

Dormant customer (no login 30+ days):

• They forgot about you. A discount won't bring them back.
• Offer: Pause subscription, "what changed?" conversation
• Low save potential — focus on learning why

Power user switching to competitor:

• They're actively choosing something else.
• Offer: Competitive match, feedback call, roadmap preview
• Medium save potential — depends on reason

---

Implementation Checklist

Phase 1: Foundation (Week 1)

• Add cancel flow (survey + 1 offer + confirmation)
• Set up exit survey with 5-7 reason categories
• Map one offer per reason (simple 1:1 mapping)
• Track cancel reasons and save rate in analytics
• Enable pre-dunning card expiry emails

Phase 2: Optimization (Weeks 2-4)

• Add fallback offers (primary + secondary per reason)
• Implement pause subscription option
• Set up dunning email sequence (4 emails over 10 days)
• Enable smart retries (Stripe Smart Retries or equivalent)
• Add MRR-based routing for high-value accounts

Phase 3: Advanced (Month 2+)

• Build health score from usage signals
• Set up proactive intervention triggers
• A/B test discount amounts and offer types
• Segment flows by plan, tenure, and usage
• Post-cancel win-back sequence (coordinate with emails skill)
• Cohort analysis: churn by channel, plan, tenure

---

Compliance Notes

FTC Click-to-Cancel Rule (US)

• Cancellation must be as easy as signup
• Cannot require a phone call to cancel if signup was online
• Cannot add excessive steps to discourage cancellation
• Save offers are allowed but "continue cancelling" must be clear

GDPR / Data Retention (EU)

• Inform users about data retention period post-cancel
• Offer data export before account deletion
• Honor deletion requests within 30 days
• Don't use post-cancel data for marketing without consent

General Best Practices

• Always show a clear path to complete cancellation
• Never hide the cancel button (dark pattern)
• Process cancellation even if save flow has errors
• Confirm cancellation with email receipt

references/dunning-playbook.md (verbatim)

Dunning Playbook

Complete guide to recovering failed payments and reducing involuntary churn.

---

Why Dunning Matters

• Failed payments cause 30-50% of all subscription churn
• Most failed payments are recoverable with the right strategy
• Subscription businesses lose an estimated $129 billion annually to involuntary churn
• Effective dunning recovers 50-60% of failed payments

---

The Dunning Timeline

Day -30 to -7: Pre-dunning (prevent failures)
Day 0:         Payment fails → Smart retry #1 + Email #1
Day 1-3:       Smart retry #2 + Email #2
Day 3-5:       Smart retry #3
Day 5-7:       Smart retry #4 + Email #3
Day 7-10:      Final retry + Email #4 (final warning)
Day 10-14:     Grace period ends → Account paused/cancelled
Day 14+:       Win-back sequence begins

---

Pre-Dunning: Prevent Failures Before They Happen

Card Expiry Management

Timing	Action
30 days before expiry	Email: "Your card ending in 4242 expires next month"
15 days before expiry	Email: "Update your payment method to avoid interruption"
7 days before expiry	Email: "Your card expires in 7 days — update now"
3 days before expiry	In-app banner: "Payment method expiring soon"

Email template — Card expiring:

Subject: Your card ending in 4242 expires soon

Hi [Name],

The card on file for your [Product] subscription expires on [date].

Update your payment method now to avoid any interruption:

[Update Payment Method →]

This takes less than 30 seconds.

— [Product] Team

Card Updater Services

Major card networks offer automatic card update programs:

Service	Network	What It Does
Visa Account Updater (VAU)	Visa	Auto-updates stored card numbers and expiry dates
Mastercard Automatic Billing Updater (ABU)	Mastercard	Same for Mastercard
Amex Cardrefresher	American Express	Same for Amex

Impact: Reduces hard declines from expired/replaced cards by 30-50%.

How to enable:

• Stripe: Automatic — enabled by default
• Chargebee: Enabled through gateway settings
• Recurly: Built-in, enabled by default
• Braintree: Contact processor to enable

Backup Payment Methods

Prompt for a second payment method:

• During signup: "Add a backup payment method" (low conversion)
• After first successful payment: "Protect your account with a backup card" (better timing)
• After a failed payment is recovered: "Add a backup to prevent future interruptions" (best timing — they felt the pain)

Pre-Billing Notifications

For annual plans or high-value subscriptions:

• Email 7 days before renewal with amount and date
• Include link to update payment method
• Show what's included in the renewal
• Required by some regulations for auto-renewals

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Smart Retry Strategy

Decline Type Classification

Code	Type	Meaning	Retry?
insufficient_funds	Soft	Temporarily low balance	Yes — retry in 2-3 days
card_declined (generic)	Soft	Various temporary reasons	Yes — retry 3-4 times
processing_error	Soft	Gateway/network issue	Yes — retry within 24h
expired_card	Hard	Card is expired	No — request new card
stolen_card	Hard	Card reported stolen	No — request new card
do_not_honor	Soft/Hard	Bank refused (ambiguous)	Try once more, then ask for new card
authentication_required	Auth	SCA/3DS needed	Send customer to authenticate

Retry Schedule by Provider

Stripe (Smart Retries — recommended):

• Enable "Smart Retries" in Stripe Dashboard → Billing → Settings
• Stripe's ML model picks optimal retry timing based on billions of transactions
• Typically 4-8 retry attempts over 3-4 weeks
• Recovers ~15% more than fixed-schedule retries

Manual retry schedule (if no smart retries):

Retry	Timing	Best Day/Time
1	Day 1 (24h after failure)	Morning, same day of week as original
2	Day 3	Try a different time of day
3	Day 5	After typical payday (1st, 15th)
4	Day 7	Morning of the next business day
5 (final)	Day 10	Last attempt before grace period ends

Retry timing insights:

• Retry on the same day of month the original payment succeeded
• Retry after common paydays (1st and 15th of the month)
• Avoid retrying on weekends (lower approval rates)
• Morning retries (8-10am local time) perform slightly better

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Dunning Email Sequence

Email 1: Payment Failed (Day 0)

Tone: Friendly, matter-of-fact. No alarm.

Subject: Action needed — your payment didn't go through

Hi [Name],

We tried to charge your [card type] ending in [last 4] for your
[Product] subscription ($[amount]), but it didn't go through.

This happens sometimes — usually a quick card update fixes it.

[Update Payment Method →]

Your access isn't affected yet. We'll retry automatically, but
updating your card is the fastest fix.

Need help? Just reply to this email.

— [Product] Team

Email 2: Reminder (Day 3)

Tone: Helpful, slightly more urgent.

Subject: Quick reminder — update your payment for [Product]

Hi [Name],

Just a heads-up — we still haven't been able to process your
$[amount] payment for [Product].

[Update Payment Method →]

Takes less than 30 seconds. Your [data/projects/team access]
is safe, but we'll need a valid payment method to keep your
account active.

Questions? Reply here and we'll help.

— [Product] Team

Email 3: Urgency (Day 7)

Tone: Direct, clear consequences.

Subject: Your [Product] account will be paused in 3 days

Hi [Name],

We've tried to process your payment several times, but your
[card type] ending in [last 4] keeps getting declined.

If we don't receive payment by [date], your account will be
paused and you'll lose access to:

• [Key feature/data they use]
• [Their projects/workspace]
• [Team access for X members]

[Update Payment Method Now →]

Your data won't be deleted — you can reactivate anytime by
updating your payment method.

— [Product] Team

Email 4: Final Warning (Day 10)

Tone: Final, clear, no guilt.

Subject: Last chance to keep your [Product] account active

Hi [Name],

This is our last reminder. Your payment of $[amount] is past
due, and your account will be paused tomorrow ([date]).

[Update Payment Method →]

After pausing:
• Your data is saved for [90 days]
• You can reactivate anytime
• Just update your card to restore access

If you intended to cancel, no action needed — your account
will be paused automatically.

— [Product] Team

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Grace Period Management

What Happens During Grace Period

Setting	Recommendation
Duration	7-14 days after final retry
Access	Degraded (read-only) or full access
Visibility	In-app banner: "Payment past due — update to continue"
Retry	Continue background retries during grace
Communication	Dunning emails continue

Access Degradation Options

Option A: Full access during grace (recommended for B2B)

• Lower friction, customer feels respected
• Higher recovery rate (they still see value)
• Risk: some customers exploit the grace period

Option B: Read-only access (recommended for B2C)

• Can view but not create/edit
• Creates urgency without data loss fear
• Clear message: "Update payment to resume full access"

Option C: Immediate lockout (not recommended)

• Aggressive, damages relationship
• Lower recovery rate
• Only appropriate for very low-cost plans

Post-Grace Period

Timing	Action
Grace period ends	Pause account (not delete)
Day 1 post-pause	"Your account has been paused" email
Day 7 post-pause	"Your data is still here" reminder
Day 30 post-pause	Win-back attempt with new offer
Day 60 post-pause	Final win-back
Day 90 post-pause	Data deletion warning (if applicable)

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Provider-Specific Setup

Stripe

Enable Smart Retries:

1. Dashboard → Settings → Billing → Subscriptions and emails
2. Enable "Smart Retries" under retry rules
3. Set failed payment emails in Dashboard → Settings → Emails

Custom retry rules (if not using Smart Retries):

Retry 1: 3 days after failure
Retry 2: 5 days after failure
Retry 3: 7 days after failure
Final:   Mark subscription as unpaid after last retry

Webhook events to handle:

• invoice.payment_failed — trigger dunning
• invoice.paid — cancel dunning, restore access
• customer.subscription.updated — status changes
• customer.subscription.deleted — final cancellation

Chargebee

Built-in dunning:

1. Settings → Configure Chargebee → Retry Settings
2. Configure retry attempts and intervals
3. Settings → Configure Chargebee → Email Notifications → Dunning

Dunning options:

• Automatic retries with configurable schedule
• Built-in dunning emails (customizable templates)
• Grace period configuration per plan

Paddle

Managed dunning:

• Paddle handles retries and dunning automatically
• Limited customization (Paddle manages the relationship)
• Webhook: subscription.payment_failed, subscription.cancelled
• Best for hands-off approach

Recurly

Revenue Recovery:

1. Configuration → Dunning Management
2. Set retry schedule per plan
3. Configure grace period and final action (pause vs cancel)

Advanced features:

• Machine-learning retry optimization
• Per-plan dunning schedules
• Built-in Account Updater

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In-App Dunning

Don't rely on email alone. Show payment failures in the app:

Banner Pattern

┌──────────────────────────────────────────────────────┐
│ ⚠ Your payment of $29 failed. Update your card to    │
│ avoid losing access. [Update Payment →]  [Dismiss]   │
└──────────────────────────────────────────────────────┘

Rules:

• Show on every page load during dunning period
• Allow dismiss (but show again next session)
• Direct link to payment update (fewest clicks possible)
• Don't block the product — let them continue using it

Modal Pattern (for final warning)

┌─────────────────────────────────────┐
│                                     │
│  Your account will be paused        │
│  on [date]                          │
│                                     │
│  Update your payment method to      │
│  keep access to your [X] projects   │
│  and [Y] team members.              │
│                                     │
│  [Update Payment Method]            │
│  [Remind Me Later]                  │
│                                     │
└─────────────────────────────────────┘

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Measuring Dunning Performance

Key Metrics

Metric	How to Calculate	Target
Recovery rate	Recovered payments / Total failed	50-60%
Recovery rate by decline type	Recovered / Failed per type	Soft: 70%+, Hard: 40%+
Time to recovery	Days from failure to successful payment	<5 days
Pre-dunning prevention rate	Prevented failures / Expected failures	20-30%
Dunning email open rate	Opens / Sent per email	60%+
Dunning email click rate	Clicks / Opens per email	30%+
Revenue recovered (monthly)	Sum of recovered payment amounts	Track trend
Revenue lost to involuntary churn	Sum of failed + unrecovered amounts	Track trend

Benchmarking

By company stage:

Stage	Typical Involuntary Churn	Target After Optimization
Early (< $1M ARR)	3-5% of MRR/month	1-2%
Growth ($1-10M ARR)	2-4% of MRR/month	0.5-1.5%
Scale ($10M+ ARR)	1-3% of MRR/month	0.3-0.8%

ROI Calculation

Monthly failed payment MRR:        $10,000
Current recovery rate:              30% ($3,000 recovered)
Target recovery rate:               60% ($6,000 recovered)
Monthly improvement:                $3,000/month
Annual improvement:                 $36,000/year
Cost of dunning optimization:       ~$200-500/month (tooling)
ROI:                                6-15x

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