From the Couch to the C-Suite: The Growth of Subscription Billing

By the end of 2021, the average U.S. consumer had 5 retail subscriptions – more than double the number they had at the beginning of 2020. And it’s not just consumers who are embracing the subscription model. From small businesses to the enterprise, B2B buyers and sellers alike have expressed a strong preference for this new digital reality.

Forward-thinking business and technology leaders recognize the value of a recurring revenue-based business model – faster, more predictable revenue recognition, and more opportunities for growth.

But successfully pivoting to a subscription-based pricing model is more complex than just updating your pricing page. To successfully capitalize on the potential of your recurring billing solution, you must deliver value across every digital channel.

Identify the Model that Works for You and Your Customers

Subscription systems aren’t one-size-fits-all, but they do have one thing in common: they must offer the product or service that your customers want or need, provide an exceptional customer experience, and make collecting payments simple and straightforward.

Flexibility is key. Customers who speak with a service agent should find the payment process as smooth as those who subscribe online. Those who start with a free trial need to be able to seamlessly switch, and monthly subscribers should find the billing process as easy as yearly renewals. Consider your business model – do you offer plans for business or personal use, or both? Tiered membership levels? Your job is to make even the most complex billing scenarios feel effortless.

“When [billing] goes well, no one cares. When it goes wrong, it’s the end of the world.”

That requires a billing system that’s as nimble as it is dependable, which is where Chargent and Salesforce come in.

Don’t Just Win Subscribers, Win them Back

Nothing kills a subscription business faster than customer churn – whether it’s involuntary churn caused by failed payments or other avoidable issues, or simply failing to deliver on your brand promise.

The goal of a recurring revenue model shouldn’t be to simply win subscribers and hope they stay on. Every recurring payment represents a new opportunity to demonstrate value, and grow trust – but also a chance for your client to find the off-ramp.

Businesses should also look to sweeten the deal whenever they can. CLEAR, a service that expedites airport security checks for a monthly fee, branched out to entertainment venues, not only giving its loyal subscribers something new to love, but also increasing the amount of data it collects on its high-value customers.

Value Beyond Revenue

Subscription billing has taken off because it’s a win-win. Businesses get to build relationships with users and the steady revenue that comes with them. Customers get the convenience of receiving a valued product or service with minimal effort. But your customers are more than just their billing information. With every transaction, they tell you about the market, your business, and what they’re looking for. Smart businesses are listening.

Take, for example, the automotive industry – they’ve realized that they will need to do more than just offer one-time car purchases in a future of ride-sharing and autonomous vehicles, and are looking for new ways to interact with customers all the time. And when it does, it tries to learn as much as it can. BMW made headlines recently with the news that they have put certain features such as heated seats and adaptive cruise control behind subscriptions. And for better or worse, they are learning what services their customers value enough to pay for.

Every interaction with your customer is an opportunity to learn more about them. Subscription models give businesses an open channel to learn more about their clients, and the best businesses will use every opportunity to get to know them better.

Flexible billing technology is key to your ability to deliver the subscription experience your customers expect, adapt to market changes, and capitalize on the customer data that the subscriber relationship provides. Chargent enables you to manage and automate subscription billing right in Salesforce – where your customer data already lives – so you can better serve your customers and benefit from recurring revenue.

Want to learn more about subscription billing with Chargent and Salesforce? Contact us and let’s talk about how your organization can tap into the right technology solution for your subscription model.