In the media industry, billing can be unique. With many firms getting paid through a combination of recurring flat fees and variable commissions, managing customer subscriptions quickly gets pretty difficult.
Take the right approach and the process is smooth. Take the wrong approach, and issues begin to emerge.
Customers don’t usually note when their subscription is handled well. They do notice when it’s handled poorly. Sporadic invoices, confusing line items, and other subscription management snafus won’t be tolerated for long.
A good subscription management software smooths out these pain points, allowing your clients to enjoy an easy, seamless experience.
1. Find a billing software with a flexible catalog that can handle multiple billing models.
Catalog flexibility improves the customer experience, but it also makes things significantly easier for businesses as well. A flexible catalog can:
- Provide you with clear account records. Businesses without a flexible catalog are forced to get creative with their billing processes. In some scenarios, this means documenting one-time charges as subscriptions that are then canceled because there is no other way to charge unique billing items. Needless to say, the random apparition of a new subscription can confuse a customer. It can also lead to mistakes—i.e forgetting to cancel the new subscription, or allowing cancellations to artificially inflate your churn rate. With a flexible catalog, one-time charges can instead be documented for what they are.
- Send out clean, clear invoices. Invoices within the media industry already have the potential to get confusing—more on that in just a second—but when you’re forced to throw in a long string of vague line items, the invoice becomes unprofessional at best, and suspicious at worse.
- Allow you to seamlessly implement multiple billing models. Media companies often bill through a combination of commissions and ongoing subscription fees. With a flexible catalog, this is no problem. Your business can make specific, custom charges as it sees fit. Without it, the process becomes challenging from the business end and potentially confusing for customers.
It’s also worth noting that any of the issues stemming from an inflexible catalog only get worse at scale. Doing gymnastics with creative line items might be doable in the beginning, when your client list is relatively small. The more you grow, however, the harder it becomes to spend lots of time figuring out something that should be seamless and straightforward.
Uberflip, a B2B marketing company, felt this problem acutely in its early days of billing using a piecemeal solution. Before adopting a subscription management service, its finance team spent many hours trying to get subscription and commission-based invoices out on time.
The bigger the agency got, the harder this became. Eventually, the billing department was handling invoices for 1600 clients by hand.
Thanks to subscription management software, the business was able to save 40 hours a month on billing. Not only that, but invoices were accurate, on time, and easy to create no matter how complex the charge. Customers were treated to a smooth experience and the business no longer had to worry about billing-related efficiency bottlenecks.
2. Look for a subscription management system that can bill and collect payments in multiple currencies
More than 40% of middle-market companies report half of their revenue comes from international revenue streams. What’s more, the international trade of goods and services is increasing at a rapid rate rising almost 40% year over year.
Even businesses that don’t have clients overseas now may want to expand eventually. While there are multiple ways to manage subscriptions at the international level, it helps immensely to have subscription management software that can bill and collect payments in multiple currencies.
Scenario: You are a U.S.-based advertising agency looking to expand to the U.K. A potential client in the U.K. logs on to your site and finds only USD pricing plans. What do they do?
Well, if they’re anything like the 86% of U.K. buyers surveyed in 2012, they move on to a different company.
Not only will a high-quality subscription management solution allow you to list and accept the international currency, but it also allows you to get strategic with your pricing strategies.
Let’s revisit our scenario. You’re trying to penetrate the British market. You’ve revamped your site so that it no longer repulses the majority of your potential clientele. There’s still a problem. The media services industry is very crowded. You, as a newcomer, are having a hard time attracting customer subscriptions.
Solution? Localized pricing.
In other words, you offer your subscription services at a price that is more competitive. Of course, localized pricing is a complicated topic—one that could easily warrant its own article—but the point is, your subscription management platform can make it easier to implement, allowing your business to benefit from the 30% growth the strategy has been shown to produce.
3. Automate dunning communications to ensure your business is collecting on payments.
Uncollected payments are lethal to the stability and predictability that otherwise comes with recurring revenue. Studies have shown up to 15-30% of recurring credit card charges don’t go through when it comes time for payment processing.
Of course, this isn’t the same thing as saying a significant portion of your customers will try to avoid paying each month. It does mean that hurdles come up—often in the form of expired or overdrawn cards.
When these problems inevitably arise, your dunning management strategy will largely determine how much of the missing revenue you collect.
A good subscription management platform can automate credit card retries, and even update card information to avoid expired cards from interrupting service. In these scenarios, the customer never even has to find out there was an issue in the first place.
Sometimes, card retries aren’t enough. In these scenarios, your subscription management service should be able to automate dunning-related communications in the form of emails and text messages.
The result? You collect more revenue. Customer retention increases because you cancel fewer subscriptions, and your billing department spends significantly less time chasing people down.
4. Base future decisions on data
Data is a big buzzword in every industry now. A 2014 survey showed executives with an eye toward data were three times better positioned to make good business decisions.
A good automated billing software provides up-to-the-minute subscription data.
Historical account information makes it easier to take a comprehensive look at your customer journey. What sort of customers go in for subscription upgrades? What sort of industries are producing the highest commission levels? Or, conversely, at what point in the customer journey are customers churning out the most often?
Your subscription management software can also serve as a single source of truth (SSOT), protecting the accuracy of your information while simultaneously making it accessible to departments throughout your business.
The result is a reliable stream of clean, insightful data that you can use to facilitate growth.
Your customers will feel the absence of good subscription management
Few, if any customers are sitting around saying “You know what their problem is? They just don’t have the right subscription management software.” But while they may lack the vocabulary and behind-the-scenes insight to describe the problem, they’ll know it when they see it.
We live in an age of options. Even if your media management services are impeccable, a customer will only accept so many muddled invoices or other subscription issues before moving on.
Modern subscription management software allows you to provide a clean, seamless experience your customers never have to think about.
Quick FAQs about Subscription Management in the Media Industry
Q: What is a subscription management system in the media industry?
A subscription management system in the media industry is a software solution that handles customer subscriptions, billing, and payments. It simplifies the process of managing recurring flat fees and variable commissions, which are common in the media industry.
Q: How does a good subscription management software benefit media businesses?
A good subscription management software streamlines the billing process, reducing administrative tasks and errors. It provides clear account records, sends out clean, clear invoices, and allows the implementation of multiple billing models seamlessly. It also assists in managing subscriptions at an international level, accommodating multiple currencies, and localized pricing strategies.
Q: What is the role of catalog flexibility in subscription management?
Catalog flexibility allows businesses to document one-time charges accurately, send out clear invoices, and seamlessly implement multiple billing models. It enables businesses to make specific, custom charges as required, improving the customer experience and reducing confusion.
Q: Why is subscription management important for international businesses?
Subscription management is crucial for international businesses as it enables them to manage subscriptions at the international level. It can bill and collect payments in multiple currencies, thereby facilitating business expansion and catering to international clients.
Q: What is localized pricing in the context of subscription management?
Localized pricing refers to the strategy of offering subscription services at a price competitive in the local market. Subscription management software can help implement this strategy, contributing to business growth in new markets.
Q: How does subscription management software help with dunning management?
Subscription management software aids in dunning management by automating credit card retries and updating card information to avoid service interruptions due to expired or overdrawn cards. It can also automate dunning-related communications, thereby improving revenue collection and customer retention.
Q: What insights can a subscription management platform provide?
A good subscription management platform provides up-to-the-minute subscription data, including historical account information. This data can be used to analyze customer behavior, identify patterns, and make informed business decisions, enhancing growth and efficiency.
Q: How does subscription management software contribute to a seamless customer experience?
Subscription management software ensures accurate, timely invoices and handles potential issues like expired or overdrawn cards without disturbing the customer. This provides a clean, seamless experience that customers appreciate, thereby improving customer retention.
