Encourage annual subscription

💡 Offer your customers an annual plan option to guarantee that they stay with you for at least 12 months.

Why annual subscriptions?

  • Longer contracts give users fewer opportunities to cancel the subscription. (once a year instead of every month)
  • Annual contracts give them more time to fully master your product and integrate it into their workflow.
  • Annual contracts attract more high-value customers who are likely more invested in using your product.
  • Annual contracts give you more cash flow upfront to invest in your product.

“Businesses with a high proportion of annual plans will have a shorter payback period because you collect the cash up front! This is a key lever for businesses to pull, especially D2C companies that go after affluent consumers, or really any B2B product. You’re effectively getting a ‘loan’ from your current customers to buy more future customers. The typical path is making annual plan = 10x monthly, but I’ve seen as low as 6x just to have the positive cash cycle to grow. One of the highest-ROI ‘optimization’ hacks for mid-stage companies is running in-app promos, emails, etc. to get people from monthly to annual plans.”

—ChenLi Wang

How to

  • Price annual plan with a discount compare to monthly plan.
  • Run in-app promos and emails to get people from monthly to annual plans