To survive every business has to have regular long term customers who use their product or service again and again. Combine this fact with how many businesses are starting to be affected by the trend to “end of ownership” which is changing the basic business model of many business, means that subscription/recurring payment technologies and processes ae becoming vital. More and more businesses and consumers now prefer to subscribe, as opposed to outright buy, e.g.
- 68 million people are now paying a music subscription around the world
- 85% of Europeans have at least one subscription
- 1 in 5 Europeans who do not to make use of subscription are willing to do so in the future.
SlimPay, a leading provider of recurring payment services have produced a white paper on How to create a successful subscription business. This lists their five top tips.
1 - Ensure a frictionless onboarding process
When onboarding customers for subscription payments, the checkout process must be as effortless as possible:
- Keep it simple: 21% of consumers who leave without paying do so because the process takes too long!, e.g.
- Use single page checkout, but don’t make it too complicated
- Use SlimPay, SaaS mode, which uses a dematerialized electronic signature and timestamping of documents constituting the contract to minimise the hassle of signing a direct debiting mandate.
2 - Take payment by whatever means necessary
Companies must be as adaptable as possible in order to meet consumer and business payment preferences in their country. Wherever possible push direct debiting as it avoids problems associated with other payment methods that can lead to cancelled subscriptions and lost revenue (expiry dates, fraud, payment limits, etc).
3 - Create a relationship with your customers
Firstly invest in a good CRM which will enable you to centralise all your information regarding each customer, and track and analyse every interaction with them at every stage of their customer lifetime cycle. This means that you will be able to send customers customised
communications based on their interactions with your company.
4 - Turn customers into advocates
In addition to having a great service/product and effective and tailored communication with your customers, you also need to make content contributing and sharing as easy as possible on your site and on other networks you’re present on: create relevant hashtags, clear sharing buttons, etc. This applies to businesses as well as consumers.
5 - Process chargebacks mercilessly
Direct debit chargebacks occur for the simple reason that the customer did not have enough money in their account at the time of payment. So, notify them about the payment failure and retry the payment at the most appropriate time.
CTMfile take: Subscriptions are different from the normal one-by-one payments. This model incorporates a whole new psychology for selling, consumption, support, and measuring your success with both consumers and businesses.
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