8 Requirements of a Comprehensive Subscription Billing Platform

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Subscription businesses continue to thrive, with growth most recently fueled by the Internet of Things (IoT). As the industry evolves, traditional billing solutions are coming up short. Fortunately, robust subscription billing platforms have risen to the challenge—offering advanced tools and features which continue to progress with the market.

What makes subscription billing platforms so special? Ultimately, it boils down to capability. Recurring billing software is designed with subscription businesses, and their various pricing models in mind. That design requires innovative features in the following areas:

1. Product catalog

Between one-time, recurring, and usage or consumption models (not to mention hybrid pricing, combining any or all three models), managing a subscription business’s product catalog is a complex task. Add in discounts, promotional rules, or product updates, and it’s easy to understand why these business owners demand both comprehensive and flexible solutions.

What’s more, because subscription businesses rely on recurring revenue projections to manage their finances, they require the ability to safely, independently test new product roll-outs and changes to pricing models. This all must happen without having to alter the active billing and accounting systems still managing the existing models. Agile subscription billing software makes this possible.

Ultimately, subscription businesses simply need billing solutions that can test complex catalogs, and manage them once made available to customers. Some things a comprehensive recurring billing platform should be able to do in this regard are:

  • Change pricing plans easily when needed
  • Handle discounts, promotions, and coupons
  • Offer the flexibility to add, remove, and change products on subscriptions

Trapped Subscription Billing Customers

2. Notifications

Subscriptions have changed the business-consumer relationship. Traditional business models center around one-time purchases; the business-consumer relationship ends once a transaction is complete. Subscription businesses, by contrast, must cultivate a long-term relationship with customers to ensure the recurring revenue upon which they rely.

In some ways, this is actually better for business. It’s easier to get customer feedback from subscribers, who hope to benefit from sharing their thoughts by getting an improved product down the line. This benefit and others, however, come at the cost of increased need for efficient customer communication.

Dunning is an excellent example of customer relationship management. With the ubiquitous use of stored credit cards for recurring payments, tactfully notifying customers of failed payments is a delicate balancing act of phrasing, timing, and frequency. Comprehensive subscription billing platforms handle this with ease.

Some other notifications subscription billing platforms should handle well are:

  • contract expiration warnings
  • activations/welcome notices
  • credit card expirations
  • failed billing attempts

When one platform handles all customer notifications in a unified manner, the business-customer relationship is poised for success.

3. Invoicing

On the topic of customer communications, invoices are the other side of the product catalog management coin. Just as a comprehensive subscription management platform should be able to handle the various complexities a business’s catalog presents, so too should it be able to translate delivered products clearly and concisely to customers through invoicing.

This is especially important in usage- or consumption-based pricing models. Invoicing becomes considerably complex, for example, in telematics businesses which may use distance traveled and drive time on top of fixed recurring fees and one-time charges for specific products or services.

Calculating these charges using an internal algorithm is one thing; presenting it clearly to a customer on an invoice can be quite another.

Fortunately, robust subscription management platforms have sophisticated invoice design tools at their disposal. A strong platform should provide a business with various means of usage data presentation, allow for invoice adjustments, and include corporate branding on invoices.

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4. Usage/metering

Invoicing based on usage means, of course, that a billing solution must be able to handle the raw usage data generated by customers, and translate that usage effectively. This is metering and rating—essential capabilities which ensure each customer is billed appropriately based on their usage and pricing plan.

  • Metering: the tracking of usage data by user, account, transaction, or another designated measure—i.e., tracking individual users on a shared mobile phone account, versus a payment portal charging a percentage per transaction
  • Rating: the measurement by which the payment will be determined—i.e., some mobile service providers charge per minute, while many other services are known to charge per hour

Subscription business is still an evolving model, so change is inevitable. What happens when metering or rating charges must be updated across the board for all existing subscribers? Comprehensive subscription billing platforms support these kinds of bulk operations, absorbing large tasks such as adding or removing products or updating pricing models.

5. Finance management

We touched upon recurring revenue projections earlier, but the importance of robust recurring billing software’s role in finance management cannot be understated.

The right platform should be able to measure and report on metrics uniquely significant to subscription businesses.

These metrics are different than the ones used by traditional billing solutions, which focus on one-time measurements such as selling price, gross revenue, and close rates.

Knowing anticipated revenue and costs is crucial to running a recurring revenue business. While accounting solutions are usually designed with the double-entry general ledger, their other features fall short of subscription business needs.

Fortunately, some subscription billing platforms like Fusebill are built on the double-entry accounting system and track and report the right metrics for success.

6. Business intelligence and analytics

Agile subscription management platforms should also be able to provide insights on:

  • annual recurring revenue (ARR)
  • monthly recurring revenue (MRR)
  • subscriber churn
  • subscriber acquisition

All of these metrics combined are important not only to revenue and cost prediction, but also to the testing and actual roll-out of new products. What’s more, subscription management analytics can provide insights to customer segments, real-time revenue snapshots, and product popularity. This data helps managers keep a finger on the pulse of a subscription business, ensuring long-term health.

7. Recurring Billing

Of course, a subscription billing platform had better get the main thing right: billing.

While traditional billing solutions may have the ability to store customer contact information, and perhaps even credit card information, they typically still require manual input of goods or services rendered during the billing cycle. This can make common tasks, such as reactivation, difficult to keep up with at scale.

Comprehensive subscription billing platforms, of course, automate the billing process. They also offer additional automated services related to billing that are hard to compete with, such as:

  • upcoming credit card expiration reminders
  • card number updating for expired or replaced cards
  • card payment retries for declined transactions

Automated billing reduces revenue leakage by ensuring recurring charges are never missed and sent invoices get paid, thanks to dunning management.

The process is “always on,” in real-time, so that all hours are business hours for customers.

8. Account management

Comprehensive subscription billing platforms are also subscription management platforms.

The distinction is important: the software doesn’t just crunch the finances—it integrates other essential account management functions such as sign-up, activation, upgrades, downgrades, cancellations, and even re-activation.

The agility doesn’t end there. In the case of business-to-business subscription providers, the ability to separate the end-user from accounts receivable when sending invoices is paramount. If the wrong person receives an invoice, there’s a chance it’ll never get paid.

In the same token, multiple users on one account still need their usage reported on one invoice to reduce confusion and bottlenecks when requesting payment. Some users may also have access to products which other users do not, despite being on the same subscription. They may still need their varying usage consolidated during invoicing.

All of this is handled smoothly with a robust subscription billing solution, which, based on payment (or lack thereof) can automatically handle provisioning, cancellation, downgrading, or pausing as dictated by the terms of the subscription.


As subscription business models continue to evolve, so will the billing solutions which support them. No matter the direction, however, one thing is certain: businesses and solutions will need to continue to focus on their relationships with customers. Acquiring customers with attractive products, and retaining them with considerate and efficient communication and self-service abilities, are practices which light the path to subscription business success.

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Tags: Subscription Billing Recurring Billing Subscription Management

Kyle Booysen

Kyle Booysen is an account manager and recurring billing expert at Fusebill. Kyle is a business graduate with majors in Management and International Business.

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