Jul 13, 2018

Why You Need A Subscription Billing Platform

The subscription model is taking over the business world. 

  • 41% of U.S. retail business revenue comes from repeat customers.
  • 15% of online shoppers have signed up for one or more subscriptions to receive products on a recurring basis.
  • The subscription eCommerce market has grown by more than 100% a year over the past five years.
  • The largest retailers selling subscription-based products generated more than $2.6 billion in sales in 2016.

It’s no wonder customers are so enamoured by the idea of getting easy, repeated access to products or services they use all the time. Subscription-based purchases are convenient (no remembering to reorder on time or make a trip to the store) and help keep expenses in check (predictable spending makes for better budgeting). For you, the business owner, subscription shopping guarantees repeat business and a reliable revenue stream.


subscription billing paltforms explained


Applying A Subscription Model Successfully To Your Business

Think you can’t apply subscriptions to your business? Think again! Chances are good you can. New sectors, like grocery stores, for example, are adopting the subscription model every day. That doesn’t mean they’re coming up with new products – they’re simply thinking of new ways to sell.

Some companies are using personalisation to their advantage, surprising customers with items matched to their tastes in every delivery. (Loot Crate sends a geeky surprise every month.) Others have found ways to appeal to a niche market, like primephonic, a streaming music service that targets classical music lovers exclusively.

Whatever type of subscription you offer, it pays to think about pricing strategies that will appeal most to your existing customers. Lower, month-to-month payments with the option to cancel anytime are usually more attractive than a high-priced, yearly subscription. Also, consider if there’s something you can give away for free to subscription customers. Amazon Prime customers, for example, get free shipping, which is an expensive proposition for Amazon but sweetens the pot for customers to keep coming back.   

What support do you need for online subscription billing?

If you’re considering offering subscriptions for the first time, look to your payment gateway for help. Does your current gateway support recurring payments? If not, don’t add on another payment gateway to handle it; instead, look for a new, all-in-one payment platform that has everything you need to process payments – including a good subscription engine – to make your life easier.

If your current gateway does handle subscriptions, make sure it’s a robust subscription billing engine that can help your business grow in this area. A gateway with an account updater feature, for instance, will proactively seek out information on cards that are expiring or have been replaced, and then automatically update a customer’s account with the new information. This system increases the likelihood of successful payments, avoids customer involvement, and has been shown to rescue up to 10% of sales.

Another important aspect of subscription billing is offering a variety of payment methods. Shoppers expect more options than just credit cards, so your payment gateway should support numerous payment types such as ACH, iDeal, Giropay, Sofort and UK Direct Debit/SmartDebit. Ensuring all your global shoppers can check out with their preferred payment type will help make your subscription program a success.

Find out about four other ways your subscription billing platform can help make the most of your recurring payments program, and then get started designing a lucrative subscription offering of your own!


Scott Ring is Product Director at BlueSnap. His areas of expertise include eCommerce, payment processing, integrations, and partnerships within companies of all sizes.

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