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Chargebacks vs. Churn: How to Strike the Right Balance

Chargebacks vs. Churn: How to Strike the Right Balance

Chargebacks911® Marketing Director Jarrod Wright Shares Insights for the Chargebee Blog

Churn, or the cancellation of service by a customer, is something that every merchant engaged in subscription-based business wants to avoid. However, as Jarrod Wright of Chargebacks911 explains in a new guest feature for the Chargebee blog, it's important to balance this stat against your chargeback risk.

Chargebee is a SaaS product company dedicated to powering some of the fastest-growing SaaS and subscription-based companies in the world. Their blog is an important resource for thousands of merchants around the world looking to gain insights on subscription management and optimization.

In the post, Jarrod notes some similarities between chargebacks and churn. More specifically, many of the negative aspects of both.

"They both result in the loss of revenue and often mark the end of the relationship with your customer," he explains. "It is therefore understandable for merchants to lump them together as unavoidable costs of doing business. This conflation, however, is a costly mistake."

Some minor steps that merchants take to prevent churn may ultimately cause their chargeback issuances to spike. To prevent this, Jarrod recommends numerous practices including simplifying cancelations, reminding customers of upcoming rebills, and more.

"You need to leverage your unique insights to optimize your strategy and manage risk at the end of the day. Otherwise, subscriptions could easily transform from an opportunity into a liability."