Automation is the name of the game in the Digital Age. The greater the number of processes we can streamline to remove the need for constant human intervention, the more time and energy we can devote to more important activities.
By implementing automation into a business, both the organization and its customers will benefit. Businesses free up valuable resources that can be allocated to more critical areas, while customers enjoy the seamless experience of checkout that requires little-to-no effort on their part.
This blog will explore a key type of automation in today’s world: recurring billing. Specifically, we’ll look at why recurring billing is important, what the benefits are for this type of automation, and what elements to consider when setting up a recurring billing engine.
Why recurring billing?
Your customers don’t actually want to pay you and it isn’t because they’d rather keep their money in their wallet (although that is certainly part of it). It’s because paying is an interruption that, if they could, they would rather avoid.
Friction in any business-customer process is negatively impactful, but it is particularly damaging at the payment stage. This is the point where a customer is evaluating your company and its products/services. Does this price justify the experience? You don’t want to give customers any last-second reason to be dissatisfied, or unsubscribe from your service.
By offering recurring billing to customers, a business is able to limit the disruption caused at this point in the buying journey, which not only limits these consumer questions but also produces a superior experience that helps foster long-term loyalty.
When it comes to companies that rely heavily on recurring payments, loyalty equals revenue.
How to leverage recurring billing successfully.
The power of recurring billing is unmistakable. For companies that rely on subscriptions or other ongoing payments, it is an absolute necessity to stay competitive, as customers are expecting to have their subscriptions billed automatically.
If you are looking to utilize recurring billing, the biggest task is finding the right solution to help you automate these payments and handle the other processes along the way. There are a few factors to consider as you begin setting up your recurring billing.
Communicate the security of your recurring billing process.
One of the biggest hurdles to overcome with customers is trust, especially when it comes to sensitive financial information, like credit card numbers, accounts, etc. Your recurring billing engine won’t be successful if people can’t trust that their sensitive data will be kept safe.
Again, this comes down to your payment gateway solution and how well you are able to effectively communicate how secure it is to your customers. This is where Inovio really stands out; we deliver a simple, step-by-step purchase process that clearly demonstrates how payments are sent and secured between a merchant and a customer’s card association.
This makes it easy to put your customers at ease and explain how their information is kept secure and away from fraudsters.
Give customers the freedom to choose their preferred payment option.
Today’s consumers have many different payment options available, beyond the traditional credit/debit card payments. Mobile devices, in particular, have opened a lot of new payment channels that consumers want to utilize. If you’re selling internationally, you’ll even encounter a lot of new payment options that you may not be familiar with.
You’ll want to set up your recurring billing to account for as many of these new and emerging payment options as possible. Doing so will help please more customers by allowing them to pay any way that they choose. In turn, this will propel your business ahead of your ecommerce competitors who are only accepting traditional payment methods.
Connect sales and inventory data streams and monitor appropriately.
One of the biggest challenges for businesses is sales and inventory forecasting. This obstacle is greatly eased with recurring billing. That’s because with recurring billing, you have an anticipated number of timed purchases being made.
For example, if you have 100 customers taking advantage of this payment method each month, at $100 a head, then you can safely assume that your sales will be $10,000/mo. You can then safely predict how much inventory you’ll need to move each cycle.
By monitoring these numbers and considering your subscription growth and cancelations, you’ll have a much easier time managing your revenue and inventory. With the right recurring billing service, you’ll also gain access to key insights into the performance of your payment program, such as how many transactions were accepted versus declined, how many re-tries it takes to achieve a successful payment, which payment plans perform the best, and so forth.
The success of any recurring billing or subscription service ultimately boils down to choosing the right payment gateway. You want to find a solution that offers a number of other features and services beyond simply allowing you to schedule and process payments.
These features, such as automatic account updates, customer notifications, omnichannel payment options, and performance insights, will help further accelerate your automation efforts. That way you can deliver a frictionless experience to customers that eliminates the common hurdles associated with paying — thereby enhancing retention rates to build a much more loyal subscriber base.