Last editedApr 20233 min read
The importance of recurring revenue for SaaS businesses is widely understood. Existing customers offer a much better rate of return than new customers, and for SaaS businesses looking to make a lasting impact, customer retention is a key goal. That’s why it’s so important to handle online subscription management as efficiently as possible. One important factor to bear in mind when considering the introduction of a SaaS subscription model is the importance of using SaaS subscription management software. The data gathered and analysed by software of this kind makes it easier for you to produce an accurate financial model for your SaaS company.
What is SaaS subscription management?
Put simply, subscription management refers to all customer lifecycle operations. This covers a broad range of processes, including managing trials, issuing refunds and making changes to an ongoing subscription. Recurring subscription management starts as soon as a customer signs up for your company’s services and ends whenever they leave or cancel their subscription.
Online subscription management vs recurring billing
Lots of people get tripped up on the difference between SaaS subscription management and recurring billing practices, believing them to cover the same ground. In fact, there’s a stark difference between these two important SaaS processes. Recurring billing is the automated process – offered by GoCardless – that allows businesses to invoice customers on an ongoing basis.
By contrast, online subscription management sits on top of your payment solution, supporting recurring billing by dealing with customer-related issues as they occur. So, although recurring billing is enormously important, it shouldn’t be your business’s only concern. Recurring subscription management deals with existing customers, ensuring that they stay with your service for as long as possible.
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Why does SaaS subscription management matter?
Part of the importance of SaaS subscription management is the fact that it covers the entire customer lifecycle, from before the customer subscribes to after they cancel. Here are the key benefits associated with recurring subscription management at each stage of the customer journey:
Online subscription management can be used to provide discounts for customers who may be dissuaded by the price-point of your service. In addition, you can use SaaS subscription management tools to provide a free trial, which can be a great way to pull in customers who are on the fence regarding your service. If they’re undecided after the free trial, you could empower your team to extend their trial, ensuring that you’re doing everything you can to capture an existing customer.
After a customer has signed up, SaaS subscription management really comes into its own. There are a whole host of important processes that your subscription management software covers, including upgrades or downgrades. Allowing your customers to drop down a pricing rung or take their service to the next level can help them get the most out of your platform. In addition, communication is key. You can use online subscription management to inform customers about features, upgrades, or upcoming payments.
After a customer leaves the service, use your SaaS subscription management tool to ask for feedback, which can help you make your platform better in the future.
As you can see, recurring subscription management affects a wide array of processes that play a significant role in keeping your customers happy and satisfied with your service.
Investing in SaaS subscription management
If you run an SME, use SaaS subscription management to provide products online on a regular and ongoing basis, ensuring a steady flow of income and bolstering cash flow. Investment in SaaS subscription should come at a time when the number of customers being served has grown to a level at which invoicing and billing on a repeated one-off basis becomes cumbersome, time-consuming and prone to mistakes. Switching to SaaS subscription management, particularly via a platform like GoCardless, could streamline your operations and enable you to access the kind of customer data software of this kind collects.
SaaS subscription management software
There are a range of SaaS subscription management tools to use in conjunction with recurring billing systems like GoCardless to handle your customer lifecycle operations. GoCardless has partnerships with subscription management software companies like Chargebee and Zuora, so you can ensure that billing and operations work hand in hand to provide the best possible experience for your customers.
We can help
GoCardless helps you automate payment collection, cutting down on the amount of admin your team needs to deal with when chasing invoices. Our technology operates in the same way as a traditional Payment Gateway, making it simple to collect and process debit and credit card payments. Find out how GoCardless can help you with ad hoc payments or recurring payments.