Renewal Email: 20 Best Practices to Follow
Every flourishing business knows that in order to achieve the utmost success, retaining old customers is even more crucial than acquiring new ones.
By perfecting renewal emails, you can help keep a strong relationship with your existing customers which will in turn strengthen your brand's reputation. After all, loyal customers are your greatest advocates.
So, what exactly are renewal emails?
Renewal emails are automated messages sent to customers reminding them that their memberships, subscriptions, or contracts are soon to be expired.
They are essential to customer retention and loyalty. These membership renewal letters call on clients to take action in order to continue using your service or product.
1. Personalize
Using your customer's name in the subject line and email body is an excellent way to let them know that they are in your thoughts. The more personalized your email is, the more likely your customers are to read it.
Furthermore, If you know a thing or two about this customer, you may want to use that information as well, to spark the user's interest further.
One good example of this is to refer to the period of time they have been a customer of yours when sending a membership renewal letter (i.e. “Hi Daniel, thank you for being a loyal customer for almost a year now”).
2. Make the renewal process easy—add a clear CTA
Your customers will appreciate that you value their time! A complex renewal process can drive customers away.
Make it easy and timely for your customers to renew their subscription by adding a CTA button that stands out from the rest of the email, and allows a one-click renewal via email, website, or member profiles.
It can read as simple as “Click here to renew your subscription”.
3. Keep it simple
Renewal emails are sent to customers that are previously familiar with your business, so there is no need to burden them with promotional content and lengthy descriptions of your products or services.
Keep your renewal reminder email short and to the point.
4. Try offering incentives
Motivate your customers to continue their business with you by offering them an enticing reward. This is a great way to keep them aware of the value you provide.
Discounts on annual plans and one month free services are some of the many extra benefits you can offer your customers. To increase the chances of renewal, you can also create a sense of urgency by adding a time limit in your membership renewal email.
Who doesn't like a good deal?
5. Send a sequence of emails
Instead of sending one solo email, create a sequence of emails to increase the chances that customers will open the email and renew their subscription.
Three emails are likely to do the trick. The first email should be sent one month prior to the account expiration involving a friendly easy-going reminder that it's almost time to renew the subscription.
The second email is usually sent 10 days before the account expiration and can include an incentive (refer to #4 above).
Lastly, the third email should be sent 3 days before the account expiration, and ought to include a very clear and obvious call-to-action button.
6. Use a reliable email service provider
The most effective way to guarantee that your renewal emails will reach your customer's inbox is to use a reliable email service provider.
With the help of our simple, secure, scalable, and automated email delivery service, Mailer To Go, you can send out well-timed, automated renewal email sequences and succeed at your customer retention goals!
7. Create a sense of urgency
Your message should contain phrases that show a sense of urgency, or fear of missing out (FOMO), and encourage customers to kickstart the renewal process.
Examples of such phrases include "act now," "upgrade now," "don't miss this discount," etc. These phrases entice the email recipient to take swift action about their automatic renewal.
This strategy works especially with millennials, 69% of whom say they experience it on a daily or hourly basis. For better results, you can include a time-limited incentive in the message alongside the phrases that create a fear of missing out.
The incentive can entice the recipient to take the automatic renewal option.
8. Mention the date of renewal and payment details clearly
If you're sending a renewal email to retain an active member, ensure you state clear details about the renewal process. Let the customer know the exact date their membership expires and the exact renewal date.
State clearly the payment information, the price, and how they're expected to pay for it. This makes the renewal process easier for the recipient, meaning they'll be more likely to follow through.
9. Highlight value points
A smart email marketing strategy is to highlight the value points of your product for the recipient, and this applies to renewal emails.
State clearly the benefits of your product that the customer has enjoyed and what they'll continue to enjoy if they renew. You can even state new features that you're working on to remind customers of what they may miss out on if their membership expires.
Highlighting the value points goes a long way in convincing current members or lapsed members to cling to their monthly or annual subscriptions. It's one of the most effective ways to keep premium members paying for your product and generating stable revenue.
10. Add a direct link to the payment page
It is important to keep customers in control of the fate of their subscription-based services. Thus, you can add a link that redirects them to the payment update page where they can control everything about the payment process.
On this page, they can update their account details and card details or cancel their subscription if that's what they want. This page makes everything about recurring payments much easier and makes customers trust you more.
11. Segment your lists
Segmentation refers to breaking up your single email list into several smaller, more targeted lists. The smaller lists contain email addresses grouped according to shared interests and factors such as age, length of subscription, customer spending, etc.
The idea of segmenting your lists is so that you can offer a more personalized experience to each segment instead of employing the same email marketing strategy for all segments.
Segmenting your lists means you can send more effective renewal reminders to each segment. For example, you can send a different renewal reminder to customers that have been with you for less than a year and those that have been customers for years.
The different renewal letters will employ different messaging for each segment. This way, you can appeal to the characteristic of each segment better and increase the chances of customers renewing their yearly subscription.
A small-digit conversion rate boost from email segmentation can add a lot to your revenue. Segmented email marketing campaigns get 14% higher open rates than non-segmented ones and are responsible for 77% of return on investment (ROI) from email marketing spend.
12. Allow automatic renewal
Automatic renewal is a great way to boost your subscription renewal rates. When you send a renewal email, you can allow recipients to opt-in for automatic renewal. This way, they won't have to manually renew their subscription and risk losing it if they forget.
They just provide their payment details and your payment processor can automatically charge their cards for auto renewal. The only time they might need to change stuff is when their debit or credit cards expire.
Explore our latest posts to improve your email deliverability rate, and more!
13. Use a creative email subject line
The subject line is the first thing that the recipient of your renewal email will see. Thus, it should employ creative messaging that creates a sense of urgency.
"Hi, your subscription is running out," "Don't let your subscription lapse," and "Renew early to enjoy our features" are good examples of creative subject lines. Note that the subject lines must be short and precise, or else recipients won't be able to grasp the idea at a glance.
47% of email recipients open emails based on the subject line alone, so it's very important to use one that'll get their attention.
14. Generate automatic lists
Your subscription management software should be able to generate an automatic list of all members that haven't paid past their expiration date.
This will make it easy to know which customers to send renewal reminder emails to instead of sifting through spreadsheets to identify those that let their subscriptions expire.
When you generate the list, you can then segment them into smaller lists for more effective marketing or send the same message to all addresses on the list, although segmentation gives more effective results from membership renewal emails.
15. Give customers more time to renew
Don't just cut off a customer's subscription if they don't pay their membership fees on the due date. There are many reasons why a customer can forget to renew, and it's best to try to find out.
You can send a follow-up email shortly after the expiration date to ask them why, as it could be a reason you could fix easily. If you send one, two, or three follow-ups to the customer directly and they don't still renew, then you can cancel their access.
16. Create a referral program
You can create a referral program for customers to spread the reward about your brand to their social circles. You can even add renewal incentives to entice them to do this, e.g., a 50% discount on the renewal price if they successfully refer a customer to you.
This helps your renewal letter be more effective and turns your customer base into a network of brand ambassadors. Referral programs are known to generate 3-5x higher conversion rates than other marketing channels.
17. Offer great customer service
Customer service is one of the major considerations in customer retention. You should set up a system for customers to ask you questions about their annual subscription and get a quick response.
Being responsive will make them more willing to renew their memberships because you're there to guide them through every step. It will also improve customers' friendliness towards your brand, which plays a big role in membership renewals.
Great customer service helps you retain users and build long-term customer relationships.
18. Make it easy to cancel or pause subscriptions
This point seems counter-intuitive to optimizing for membership renewals, yet it works. Remember that it's advisable to keep the customer in control. Make it easy for them to cancel or pause their subscriptions if that's the choice they want.
Avoid "dark patterns" that many platforms employ to make it difficult to cancel subscriptions, such as hiding the cancel or pause button or requesting a phone call for cancellation.
If you employ dodgy patterns, you may retain revenue for some time from customers finding it difficult to cancel, but you'll lose much more in brand appeal and sales when these customers give bad reviews about your service.
19. Send card expiration emails
Most debit and credit cards expire three to five years after issuance, and expired cards are one of the main causes of customer churn.
Hence, it is important to send notifications to customers whose cards are about to expire, so that they can input new card details and pay for renewals successfully. You should do this 30 to 60 days before the card expiration, and you can send multiple emails to remind the customer.
There are many software tools that let you send automated card expiration reminders to customers. These tools go a long way in reducing your customer churn.
20. Appreciate your customers
It's important to appreciate the customers that stick with your service and renew their subscriptions for many years.
You can send appreciation emails to customers who have stuck with you for a while, e.g., 5 years, to make them feel important and cherished. You can even add freebies such as a discount on the next renewal to make them happy and more likely to stay.
We talked earlier about email segmentation and it applies here. You can simply segment your email lists according to the number of years a customer has subscribed to your service and send an appreciation email to the correct segment.
In closing
Acquiring new customers is one thing and retaining your existing customers is another. Renewal emails are necessary for subscription companies to keep their customers and reduce churn.
We have laid out the best practices to follow to send the most effective renewal emails and retain your customers as much as possible. Follow these practices, and you'll likely see positive results and maintain stable revenue.
Explore our latest posts for more transactional email best practices.
Frequently asked questions
What is a renewal email?
A renewal email is an automated message sent to customers to remind them that their subscription, membership, or contract with your company is about to expire. The purpose of this email is to prompt customers to renew their agreement or subscription, ensuring continued use of your product or service.
Why are renewal emails important?
Renewal emails are important because they help retain customers and maintain revenue. By reminding customers of their upcoming renewal date, you give them the opportunity to continue using your service without interruption. This also provides a chance to communicate any changes or updates related to the renewal.
What should be included in a renewal email?
A renewal email should include the following:
A clear subject line indicating that it's a renewal notice.
Personalized greeting.
Information about the renewal date and the process to renew.
Details about the product or service that's up for renewal.
Contact information for customer support in case the customer has questions or issues.
If you're using a transactional email service like Mailer To Go, they can help you automate and manage these renewal emails effectively.
How can I make my renewal emails more effective?
To make your renewal emails more effective, ensure they are personalized and sent at the right time. Personalization can include addressing the customer by name and mentioning the specific service they are using.
Timing is also crucial - you want to give customers enough notice to take action, but not so much that they forget about the renewal. It's also helpful to provide clear instructions on how to renew and who to contact for support.
Can renewal emails be automated?
Yes, renewal emails can be automated. This is often done using a transactional email service provider like Mailer To Go. These services can automatically send renewal emails based on the expiration date of each customer's subscription or contract.