How To Make The Most Of Your Recurring Payments Program

Written by: Mike Misasi

It’s never been easier to buy toilet paper. Or toys. Or video games, clothes, cat food, travel accessories…and just about anything else you can think of. And it’s all thanks to subscriptions.

These days, subscriptions are showing up in more and more places. It used to be that online subscriptions were reserved for things like music streaming services and software; now, people can sign up to receive recurring shipments for just about anything they can buy online—including, most likely, whatever your eCommerce store sells.

For customers, subscriptions are convenient—no decisions, no planning, no hassle.

For businesses, subscriptions represent predictable revenue. They also remove the uncertainty that naturally comes with every potential purchase—the moment right before buying when a customer thinks: Should I? With a recurring payments program in place, there’s no need to involve the customer at all, because every payment is automatic. And with recent statistics showing that 40% of online revenue comes from repeat purchasers, you can’t afford to miss out on subscription sales. (Another perk: Repeat customers have a higher average order value than first-time buyers! What are you waiting for?)

If you’re considering offering subscriptions for the first time, or just trying to improve your existing recurring payments program, look to your payment gateway for help. It’s about more than just collecting payments; the most successful programs are supported by gateways that work hard for every sale, every time. So keep reading for five ways your payment gateway provider can help you make the most of your recurring billing program. If they don’t measure up, take a look at BlueSnap’s award-winning subscription billing engine, or ask us anything you’d like to know!

5 Ways To Make The Most Of Your Recurring Payments Program


1. Utilize your payment gateway’s
account updater feature.

If one of the best things about subscriptions is removing buyer uncertainty, then you need to make sure a customer never (or rarely!) has to think about their recurring payments online. Your gateway should have an account updater feature to handle that.

Not sure what your payment gateway should have, exactly? Here are 10 questions to ask so you can make the right choice.

Occasionally, subscription payments hit a roadblock, usually due to expired or replaced credit cards. When that happens, the card can no longer be charged. Ordinarily, you would have to contact the shopper and ask for updated payment information. But if you’re taking advantage of your gateway’s account updater feature, the gateway will have proactively sought out new card information prior to billing time and updated the customer’s account automatically. The recurring payment would then go through as usual.

Because BlueSnap stores credit card information, we know the expiration date of each card. If we see that a card is about to be charged for a recurring payment in the next week, we’ll contact the payment network for you and get a new card number. This system increases the likelihood of successful payments, and at the same time avoids customer involvement. This has been shown to rescue up to 10% of sales.

2. Analyze the performance of your recurring payment program using data.

It’s a good idea to analyze all aspects of your company’s performance using data—your recurring billing program included. Your payment gateway should be able to provide conversion analysis data for recurring payments so you can see that the subscription engine is actually working. Look for information on how many recurring charges were successful, how many attempts were declined, and, for the transactions that were declined, why.

BlueSnap has a payment analytics tool built in to our All-in-one Payment Platform. You can easily access your recurring payments data in multiple ways: from the BlueSnap Customer Console, our Reporting API, or via our mobile app.

3. Choose the optimal subscription payment plan for your business, including discounts and promotional pricing.

The design of your recurring payments program shouldn’t be limited by your payment gateway. You should be able to choose the pricing model and payment intervals best suited for your product. So if you want a weekly subscription option, make sure your gateway can handle it.

It should also be exceptionally easy for you to manage the details of your subscription billing engine, so you can switch things up on a dime. Many merchants offer introductory rates for the first two years, for example, after which the subscription price goes up to the regular rate. Others have different pricing tiers, so customers can move to different plans if they like. It’s also nice to have the ability to offer an unsatisfied customer a discounted rate for a certain period of time (like the next three months free). Any and all of these options should be available from your payment gateway, with a minimal amount of effort on your part.

BlueSnap makes it easy for you to look up and change subscription settings on the fly or in advance, right within the BlueSnap web console. And when customers change plans, we’ll automatically calculate the price difference, issuing refunds or additional charges if necessary.

4. Accept a full range of payment types.

You can reach more people and businesses by offering more than just cards for subscriptions. Your subscription billing engine should support a range of payment options, like bank transfers, wires or electronic checks. And if you’re hoping to sell globally, it’s also advantageous to offer international payment methods your global shoppers will be familiar with.

BlueSnap’s subscription engine has built-in support for credit cards and PayPal, both of which can be automatically charged for each payment period. We also offer Automated Subscription Reminders, which enable you to offer additional subscription payment options, including Webmoney (Russia and Ukraine), Giropay (Germany), Sofort (Austria, Belgium France, Germany, Italy, and Spain), iDeal (Netherlands), and wire transfers. Because of the nature of these alternative payments, shoppers have to authorize each charge. That’s where Automated Subscription Reminders come in: When a subscription payment is due, we automatically send out reminder emails to shoppers using these payment methods, prompting them to log in and confirm their payments.

5. Minimize the number of failed transactions with automated retries.

To maximize the number of successful subscription payments, look for a payment gateway that retries “soft decline” subscription purchases (instances where the charge failed for a reason other than fraud or a lost or stolen card) several times, automatically. If a charge is successfully completed during one of the retries, the subscription continues as usual. Automatic mechanisms like these help turn more declined transactions into acceptances.

In the case of a soft decline, BlueSnap automatically reattempts payment 5, 10, and 14 days after the initial decline. If it’s successful, the subscription continues. If a retry is not successful, the subscription goes into suspended status after the last automatic retry, and will be cancelled after a grace period defined by you.

Get more “bang” from your subscription billing engine.

The whole point of subscriptions is to increase sales, so make sure your payment gateway is working hard to help your recurring billing program succeed. If you’d like to talk with us about our award-winning subscription billing engine and what it can do for you, get in touch!

 

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