Tactical retention is 25-40% of your churn

Most of the time that there are two types of retention. There is strategic retention and then there's tactical retention. Strategic retention is all the stuff that you as a great product leader, a great product team are doing. Your ICPs, your time to value, road mapping, the right features, figuring out your mission metric, agonizing over every little thing, all the paper cuts of being a great product leader. But because you're so focused and so biased towards that, you miss out typically on this thing we call tactical retention, and these are things like payment failures, term optimization, cancellation flows, offboarding, et cetera.

If you're past product market fit this area, this tactical retention, it's typically about 25 to 40% of your churn problem, which is a significant amount, but you don't really look at it because again, you're like, 'I've got to go focus on features, I've got to do this, and I'm going to go be this great product leader.'

I looked at two million cancellation flows. We built some products for this, that's why I have this data, just to be clear. But looked at two million cancellation flows and we found you have about 18 to 30 seconds when someone hits that cancel button, we found you should ask two questions. One, 'Why are you leaving?' Multiple choice. Don't do the free response. You get one out of 100 great responses, and the 99 are not great. And then the other question we found works really, really well is, 'What did you like about the product?' And the reason that works so effectively is because that person's on a freight train to basically cancel. They're like, 'I'm already done. Oh yeah, this is why I'm leaving.' The minute you ask them what they like, you're basically tapping into this nostalgia effect and you're stopping that freight train.

When we looked at the cancellation reasons and we saw that their number one reason was, I still have too much fear, we actually decided, well, let's just add a pause button then. Because canceling the subscription is a permanent solution to having too much fear.