As the legendary quote from the Spider-Man franchise goes, “With recurring subscription revenue comes recurring customer management responsibilities!”
Okay, I kid.
However, I am serious in saying there’s a lot to be done to ensure your SaaS customers have a smooth experience with your recurring revenue business so they keep on paying you month after month.
For example, you obviously need to collect your customers’ billing details during signup. Then, if they’ve signed up for monthly billing, you need to send them their invoices—taking into account any changes to their subscriptions—every month.
And if they don’t paid by the deadline, then you have to follow up until they do.
There are the upgrades, the downgrades, the add-ons, and the upsells to manage. And of course, new payment methods and general ongoing communication.
All of this is no small amount of work!
You may be able to get away with doing everything manually if your SaaS subscription business is just starting up and has only a handful of customers. But as you grow, you’ll quickly find such efforts unfeasible—especially when automation can do the same work faster, more accurately, and potentially at a lower cost.
Let’s take a look at how you can automate various subscription management tasks and processes to add efficiency and scalability to your SaaS subscription business.
1. Collect subscription billing details with a lot less human effort.
When subscribers first sign up for your service, perhaps you connect with them one-by-one over phone or email to get their billing details.
Sure, you can copy-and-paste templates into your emails to speed up the process, but you could still make errors while filling out the template’s placeholders. Bear in mind too, customers may not respond to your first outreach attempt. So you’ll need to repeat the process until they finally give you what you need.
Needless to say, this whole manual subscription management approach is inefficient, especially if you have a long line of customers waiting to be onboarded.
With comprehensive subscription management software on the other hand, you avoid the bottleneck. You can set up hosted registration pages for customers to sign up and submit their recurring billing details themselves. You can also prepare automated email notifications to prompt new customers to add their billing information before you activate their subscriptions.
As a result, collecting subscription billing details is a breeze—whether you have ten, one hundred, or even a thousand new customers to onboard.
And spending hours to individually contact each of your subscribers for their billing details will become a thing of the past!
2. Put customer subscription management on autopilot.
Are your customers reaching out to your support team whenever they want to upgrade, downgrade, or adjust their subscriptions?
Every one of these subscription management requests in a regular customer lifecycle adds a new ticket to your support queue.
Multiply this by several hundred requests a week, and your support team members may find themselves spending more time on subscription management tasks than applying their expertise to resolve more pressing technical difficulties.
Your support team could also get so bogged down with subscription management tickets they aren’t able to respond to as quickly as before. This could cause customers to churn out if they feel dissatisfied with the speed of support they’re paying for.
Modern subscription management tools like self-service portals enable customers to manage their subscriptions themselves.
This not only lightens your support team’s load, but also helps remove barriers to processing more upgrades and boosting expansion revenue—such barriers being your team’s available bandwidth.
When technology solutions provider NonProfit Technologies needed a billing solution that would support its rapid growth, it opted for comprehensive subscription management platform that allowed it to set up its own hosted self-service portal.
- By doing so, the business empowered its customers to handle their own subscription management themselves 24/7 without having to contact support—arguably creating a better customer experience.
- This digital transformation also prevented NonProfit Technologies from having to hire more staff to oversee its growing base of customers, which now number in the thousands.
The business has been able to maintain a 50% annual growth rate, while doubling its number of product offerings every year.
The less subscription management your team has to do, the more they can focus on higher strategy initiatives to scale your SaaS business.
3. Error-free recurring invoicing and quicker payments collections.
Even a person with the keenest attention to detail will occasionally slip up when preparing invoices manually. Especially if they’re doing this day-in and day-out or working on complicated recurring accounts.
This is no way to scale your business.
Adding more subscribers will only mean adding more tedious invoicing tasks to your finance team’s workload.
Using subscription management software, on the other hand, invoices can be automatically and accurately generated within seconds, ready to be sent out. And your finance team won’t even have to hit send themselves as the software can automate that too.
Then comes the next hurdle: how will you collect payment?
Different subscription customers may request to use different payment methods and require different payment terms. Accommodating everyone’s preferences can be a hassle, but it’d be a shame to lose a customer’s business just because you can’t meet its payment needs.
The solution is to invest in automation that not only reduces the complexity arising from offering varied payment methods and terms, but also helps you get paid faster.
This is exactly what B2B SaaS businesses with more than 20% annual revenue growth have done, according to management consulting firm McKinsey & Company.
By automating their processes, these higher-growth companies can offer customers more flexible payment terms, yet keep their average payment term length shorter than their lower-growth counterparts.
4. Done-for-you dunning management.
As your SaaS subscription business onboards more and more customers, you’re more likely to run into the issue of customers not paying their invoices.
Some of these customers may have consciously decided not to renew their subscriptions. However, others may have wanted to renew, but their credit card expired or experienced some sort of issue without their knowledge. Alternatively, they might have accidentally made a typo in their billing information.
Either way, payment gateways see this as payment failure, placing customers at risk of involuntary churn—in other words, the unintentional canceling of their subscriptions.
Your finance team could individually contact these subscribers before they churn for good. However, what if I told you modern subscription management software can help salvage the situation predictably and at scale?
Executive coaching business The Covenant Group used to collect payments for its subscriptions by faxing invoices and payment reminders to customers, and then processing payments by hand. However, this manual approach meant the business would take up to 10 working days to become aware of failed payments.
This, in turn, delayed the activation of its dunning management process.
After switching to an adaptive subscription management software solution, The Covenant Group was able to automate its dunning management to:
- send customers automated messages to nudge them about their expiring credit cards or failed payments, and
- automatically retry credit cards when failed payments occur, with zero lag time after detecting a failed payment.
It’s collections process shrunk from about 125 working days down to just one.
“We haven’t added to the team,” says Keita Demming, Head of Development and Innovation at The Covenant Group.
“We’ve just added the right software.”
Supercharge your growth using automated subscription management software
Implementing efficient, reliable, and automated subscription management software is key to unlocking rapid growth for your SaaS business.
While you can always recruit more and more staff to handle rising customer subscriptions and their lifecycle management needs, the simple truth is humans are prone to mistakes and have limited capacity.
Automated subscription management software takes over repetitive and tedious tasks and performs them perfectly—every single time.
No matter how large or small your customer base, it’s never too early to start thinking about digitally transforming your subscription management processes with automation. This frees up your team to focus on tasks requiring creativity and strategic thinking, which can’t be outsourced to a machine (for now), as you scale your business.
Trust me on this: once you’ve experienced the power of automation, you’ll never want to go back.
