Recurring bill payments can transform business revenue projections into reliable cash flow that can be leveraged as part of your business’s overall financial strategy.
Though recurring bill payments may offer customer convenience, it also requires additional nurturing to ease a customer’s hesitancy and resistance to such a commitment.
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Here are a few simple ways to increase consumer sign ups for recurring payments:
Keep it Simple
Whether driven by the paradox of choice, analysis paralysis or simply too much information, an abundance of pricing and payment options may result in customers feeling so overwhelmed that they do nothing.
Simplicity encourages customers to choose recurring payments. Outline basic pricing menus and include features, benefits, value along with the type of customer each package is intended to serve. Help them navigate the selection process by noting which options are most popular, package comparison and which provide the most value based on user behavior and need.
There is a perceived cost associated with customer inconvenience—especially if they’ve never used a product or service like yours, or your business is new to market.
Be overt about your billing policies by including:
- when payments process
- whether a fee is involved for payments that cannot be completed as established
- the vendor name they’ll see on their billing statement
- who/how to contact with billing questions
- how to cancel their subscription
Ideally, your cancellation process can be handled entirely online, no questions asked. Include customer testimonials or links to online review sites to demonstrate your legitimacy, and customer care.
Earn Your Customer's Trust
Asking customers to commit to an ongoing relationship that involves their sensitive information is a tough sell when you haven’t established trust. Address their concerns with a free trial period that allows them to fully experience an entire billing cycle before requiring that they provide sensitive information. (Ideally, sign-up will require little more than their email address). Once they do sign up, continually remind them of your billing and cancellation policies, including the date that their free trial period ends.
Related Article: How to Collect Overdue Bills From Good Customers
Show Them the Value
Once a customer signs up for your product, educate them on the features, benefits and best practices to get the most from your product. The earlier in the usage process you can get them hooked, the greater the likelihood that they’ll sign up for recurring payments to avoid service interruptions.
Provide real-time customer service (via chat, email and phone), to address user questions and to demonstrate how easily they can make contact if they choose to end their subscription at any time. Reinforce the “hard” benefits the product offers relative to the billing cycle duration to ease hesitancy. If you bill monthly, for example, describe the value and benefits they’ll receive from a monthly perspective, too.
Pricing is a matter of perception. Test different price points, billing frequencies and customer response. Once a customer becomes a frequent user, he/she may be willing to move into a flat fee. However, when you begin cultivating a customer relationship, a $15 monthly commitment that can be canceled at any time is a far lower hurdle than a $150 annual subscription—despite that the latter is a better value.
Offer Payment Convenience
Give customers a reason to believe in the convenience of recurring payments with options that tailor to their unique needs. Allow popular customer payment options including automatic withdrawal from a bank account, credit card payments, and mobile and digital wallets. Empower them to self serve their method of payment at any time, and to customize cycle starting, ending and payment due dates.
Recurring payments can provide benefits to customers and merchants, but they’re not an inherently easy sell. Simple pricing menus, transparent and customized processes can give customers the sense of control they need in order to feel comfortable committing to an ongoing (and automated) billing process.