One of the major benefits of choosing a subscription based payment option over a one-time fee is the ability to generate continuous income essentially on auto-pilot. Instead of being forced to constantly upsell new products to keep past customers coming back, subscription plans gets customers to stick with your company for an extended period of time.
This ease of operation only works if your recurring billing process is set up properly. If your billing system requires customers to do several steps manually, you're increasing the chance of having them cancel their subscription. Consider these 3 tips to help simplify your recurring billing process.
Be Transparent
The more information you keep from your customers, the more questions and support tickets you will have to deal with. Transparency includes ensuring customers know when their next billing date is, exactly how much will be charged, and providing an explanation of any additional fees they may have incurred during the billing period.
The subscription based payment option has come under fire in the past due to alleged issues with companies like Vonage, who was accused of making it difficult for customers to cancel their accounts. For this reason, customers are somewhat wary of recurring billing right out the gate. You can ease their worries by being upfront about all billing information right from the start. Luckily, most recurring billing software will help with transparency by sending automatic emails before charges are made to the customer's account.
Automate Notifications
People sign up for recurring billing because they don't want to go through the hassle of trying to remember when a bill is due and they like the convenience of not having to login to make a payment every month. However, there will be times when a charge doesn't go through for technical reasons or because the customer's account is out of funds. Your subscription software should have a built in system that automatically generates an email to be sent to the customer if a charge was not completed. Otherwise, they may never even realize it.
Notifications should be sent out for any account related issues such as possible security threats, payment problems, emails getting bounced, and other problems that could affect the customer's account. The only time you should have to manually contact customers is when their accounts are extremely delinquent (at which point you should cancel their services) or if you're responding to a support request. Other than that, your notifications should be automated whenever possible.
Respond to Support Issues Immediately
You may come across customers who have questions about billing such as how to change their billing date, how to upgrade, or other questions that require an immediate response. The absolute worst move you can make in these situations is to ignore them. Slow response times make customers feel unappreciated and frustrated and will ultimately create a high churn rate. Customer service has to be a top priority.
To help reduce the amount of billing related questions your support team receives, you can setup a Billing FAQ page that goes over general questions. You might even consider making a few screencasts to demonstrate how to upgrade billing plans or how to change the authorized credit card.
Recurring billing does not have to be complicated. The last thing you want is for customers to cancel their subscriptions because of a billing related issue.
