Last Modified: April 22nd, 2022
4 min read
In today’s marketplace, it is more important than ever for businesses to offer a variety of payment options. Not only does this provide customers with the opportunity to choose what works best for them, but it also ensures that businesses are able to capture as many payments as possible, and as timely as possible.
Below are best practices in recurring billing and subscription management:
Keep track and update your customer information
When dealing with recurring payments, it is important to keep track of customer information. This includes contact information, payment history, and any other relevant data.
Since customer information can change over time, it is important to update your records on a regular basis. This will help ensure that you have the most accurate data possible and that you are able to reach customers if there are any issues with their payments.
Be clear about pricing and billing policies
The most important thing when it comes to subscription billing is to be clear about your policies from the start. This means that you need to be upfront about pricing, billing frequency, and any other relevant details. Customers should never be surprised by a bill, and if they are, they are likely to cancel their subscription.
In addition to being clear, it is also important to make sure that your billing process is easy to understand. This means using simple language and avoiding industry jargon. Customers should be able to look at their bills and easily determine what they are being charged for. This should be readily accessible on your website as well.
Also, be sure to update your customers if there are any changes to your pricing or billing policies. Customers appreciate when businesses are transparent, and it will help to build trust between you and your customers.
Make your subscriptions flexible
Customers should always feel like they have control over their subscriptions. This means that you should offer a variety of plans and let them choose the one that best meets their needs. In addition, you should be willing to make changes to plans if a customer requests it.
For example, if a customer wants to downgrade their subscription, you should allow them to do so without penalty. Similarly, if a customer wants to upgrade, you should make it easy for them to do so.
This is to make sure that customers feel like they are in control of their subscriptions. This will decrease the likelihood of them canceling their subscription.
Make it easy for customers to cancel
Customers should never feel like they are locked into a subscription. This means that you should make it easy for them to cancel their subscription if they need to.
In addition, you should make it easy for customers to pause their subscription if they need to. This could be for a variety of reasons, such as going on vacation or taking a break from your service.
Customers should know they have the flexibility to cancel or pause their subscription as needed. This will decrease the likelihood of them canceling their subscription entirely.
Use a recurring billing and subscription management solution
There are a variety of subscription billing solutions on the market. These solutions can help you automate your billing process and make it easier for you to manage your customers’ subscriptions.
In addition, these solutions can help you track your customer’s payment history and send them reminders when their bill is due. This can help you avoid late payments and reduce the number of customer service inquiries.
Subscription billing platforms make your billing process as efficient as possible. This will free up your time to focus on other aspects of your business.
We recommend using ZoneBilling’s recurring billing and subscription management solution. ZoneBilling offers a variety of features to help you manage your customers’ subscriptions from simple to complex billing and revenue management in NetSuite.
Consider using auto-renewals
Auto-renewals are a great way to ensure that your customers never have to go through the process of renewing their subscription. This can be a great convenience for your customers, and it can help you avoid losing customers due to lapsed subscriptions.
In addition, auto-renewals can help you increase your customer retention rate. This is because customers are more likely to continue using your service if they don’t have to go through the hassle of renewing their subscription.
The goal is to make it as easy as possible for your customers to continue using your service. This will help you retain more customers and reduce customer churn.
Contact us for a no-obligation, free consultation
Subscription billing can be a complex process, but there are a few things you can do to make it easier for you and your customers. By being clear and transparent, offering flexible subscription plans, and making it easy to cancel or pause a subscription, you can reduce customer churn and keep your business running smoothly.
In addition, using a recurring billing and subscription management solution can help you automate your billing process and free up your time to focus on other aspects of your business. Consider using auto-renewals to make it even easier for your customers to continue using your service.
More importantly, these subscription management solutions also automate revenue recognition which can be extremely cumbersome if left being done manually. These solutions also ensure ASC-606 compliance.
By following these best practices, you can ensure that your subscription billing process is efficient and effective.