What is Subscription Management?
Subscription management refers to customer lifecycle operations like managing trials, assigning credits, issuing refunds and making mid-cycle subscription changes. While recurring billing is automated, subscription management involves billing actions that cannot always be scheduled.
A good chunk of all the digital and physical services we use today are subscription based.
Dollar Shave Club or Birchbox at home. Slack, AWS or LinkedIn Premium at work. A food or salad subscription for lunch at the desk. Spotify or iTunes for a workout. Gmail for work emails. Netflix, Hulu or Amazon Prime Videos to wind down.
SaaS companies, media outlets, education portals, eCommerce sites and many other businesses see the value of turning one-time customers into recurring subscribers. Adopting this pricing structure has led to big changes in the way they build revenue, often providing more stability and confidence in their projections.
And when recurring revenue spurs growth, retention becomes one of the most-watched metrics in a business and subscription management comes into stronger focus. But what exactly is subscription management?
Untangling Subscription Management from Recurring Billing and Payments
Every business that has a subscription-based pricing structure keeps track of customers, processes payments and cancellations, records buying history, sends invoices at the right time, triggers payment failures, and much more. But it’s not necessary that one solution service all of this.
This is what subscription management is NOT:
A subscription management solution works on top of a payment processor to support recurring billing and allows teams to take actions that cannot be automated.
In other words, it allows you to address many of the customer-related actions that come into the picture when payments recur. But why do businesses need it? The fact is, when customers return to you week after week, month after month, your relationship changes from being a simple transaction into a long, involved conversation.
Here’s Why Subscription Management Really Matters
Let’s look at why subscription management is vital with three scenarios from a typical customer lifecycle:
Recurring billing and subscription management are always tightly integrated with each other, one offering automation and intelligence, and the other, flexibility and more control.
So when subscriptions are poorly managed, customers lose trust in the business and stop wanting to deal with them. Prove that payments happen securely, responsively and seamlessly on the business end, and customers forget about billing, focussing on the value and the experience you provide instead.
The basis for the success of any recurring business is its ability to build strong, positive relationships with its customers. With a well-built subscription management system, every sign up can be the start of something beautiful, instead of an operational headache.
The Billing Intelligencer
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