Be it subscription based or any other business – increasing revenues is the most common goal for all enterprises. And recurring revenue contributes majorly to the overall profitability of any business. But, not all of your existing customers will become repeat ones or renew the subscription plans which is often a struggle for the subscription businesses. In order to increase the recurring revenue or overall revenue, you need to adopt certain subscription billing renewal strategies, so that subscriber churn is never an issue to grow your business.
Top Subscription Billing Renewal Strategies that Help Boost Your Revenue
Provide Additional Offers for Long-term Subscription
Let’s start with an example, OTT platform Hulu’s monthly subscription (with ads) costs US $5.99 per month, while the annual subscription for the same plan costs US $59.99 per year so that customer can save almost US $12 by taking the annual subscription.
And most of the subscription based businesses take this approach to make the customers take long-term subscriptions that are not only equivalent to repeated renewal at the end of each month but a more secure way to boost your revenue, as once they take the yearly subscription, there is no chance of losing them in the midway!
Convey the Value of Your Brand
Once the customer understands the value of your brand and the quality of your products or services, they will be more likely to renew their subscriptions. There are multiple ways to establish this during the first month of subscription for your new customers-
- Give them a brief and to-the-point overview of the exclusive benefits they are getting by taking your subscription
- Let them know about the perks of taking your subscription for long-term
- Ensure that the customer service is good enough to exceed their expectations from day one, be it their billing related queries or requirement for any other assistance
- Keep your subscription billing model transparent that gives your customers insights on exactly what are they paying for
- Keep the UX of your website or app simple so that your customers don’t find difficulty in browsing through your products or content
- Don’t forget to pamper your customers with the discounts, coupons, and offers to keep them interested in taking your subscriptions for longer!
Consider Upselling and Cross Selling
One of the effective ways to increase your MRR (Monthly Recurring Revenue) is to upsell and cross sell your products. A few tips that work for any subscription based business-
- Thoroughly research on your customers’ buying or demand patterns
- Cross sell the products or services by encouraging the present subscribers to add a new plan during their renewal
- Upsell the products which can be of their preferences or benefits whenever new customers turn up to subscribe or existing ones renew their plans
Though this has been basic for the subscription based businesses, it still works to make your customers renew their subscription plans in a hassle free way as they don’t have to go through the payment process again and again.
Pointers to keep in mind-
- Your billing system offers enough security to make the customers choose auto renewal
- Keep your pricing model flexible and transparent
- Make the auto renewal optional
Offer Grace Periods
If your customers forget to renew, don’t cut off their access, just give them a reminder and allow them a few more days to decide about subscription renewal. For instance, Netflix gives this facility to their customers, instead of blocking access instantly, they allow additional days for subscription renewal.
Measure the Subscription Metrics
In order to come up with the best subscription renewal strategies, you need to measure the related subscription metrics timely, such as –
- Churn Rate
- Monthly Recurring Revenue (MRR)
- Annual Recurring Revenue (ARR)
- APRU (Average Revenue Per User)
- Customer Lifetime Value (LTV)
- Customer Acquisition Cost (CAC)
- Retention Rate
- Trial Conversion Rate
Etc. And the good news is, a top-rated billing system will allow you to have clear insights on all these. Once you have a clear understanding of how successful your present subscription strategies are, it will be much easier to implement better ones to increase your revenue or prevent churn.
Muvi Billing, the enterprise-grade Subscription Billing Software for websites and apps, provides automated & flexible billing solutions, smart record keeping, 40+ payment gateways, multiple monetization models and analytics & insights. Muvi billing offers carrier-grade security and PCI compliant platform for all billing activities and integrates fast & smoothly with any platform and third party solution.
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