If you sell a WordPress theme or plugin with annual licenses then you probably have a desire to see those renewals be as high as possible. In my conversations with other product businesses, these renewal rates can be all over the place from really low to a little less low.
My own experience with Ninja Forms confirms this. We started selling annual licenses on September 1st, 2013. When this same month hit in 2014 our renewal rate was just over 7%. Obviously we weren’t very excited about this.
Let me provide some context before I share what we did to increase these rates. Ninja Forms is a free plugin but the business is built on selling add-ons that allow you to extend the functionality it provides out of the box. Our add-ons sell anywhere from $14 to $129 a piece.
Our current renewal rate is currently at 60% off the current listed price. This is a little larger of a discount than the industry standard presently. This discount takes into account what we need to cover the cost of support and the further development. We track everything meticulously so if we determine this isn’t the case we will certainly revisit our renewal rate at that time.
Our set-up is pretty straightforward. We use Easy Digital Downloads with the Software Licensing extension to handle our license sales. At the time it sent one license renewal notification 30 days before it was set to expire.
So how did we go from 7% to 25% in monthly renewals?
We sent more reminders.
That’s it. When we only sent one reminder at 30 days before expiration only 7% of customer renewed their licenses. We added additional reminders at 2 weeks, 2 days, and 1 day before expiration and instantly our renewals increased to 25% and seem to be climbing. They all say basically the same thing but having more of them made a huge difference.
Is that the end of the story?
That’s all we’ve done so far. We wanted to have that change in place for a few months so we could hopefully determine it’s affect, but there is a lot more that could be done and tracked to make this even more effective. Here are some other things I plan to look at this year and you might want to investigate yourself.
- What difference would a reminder after expiration make?
- What reminders produce the most renewals?
- Does altering the copy in the reminder have an impact?
- What about having diminishing discounts at various intervals after expiration?
- What have you tried that has helped increase your products renewal rates?
- What are some other things you thing might have an impact?