This article will go into detail about what you need to automate in order for your SaaS company to have a functional subscription billing solution.

One of the problems SaaS companies face when selling subscriptions is linking their applications to the billing process.

The challenge in managing these billing processes is handling these events, such as restricting access to an application when a trial expires or if there is no valid funding source associated with an account.

SaaS Subscription Lifecycle

The process a customer goes through while doing business with a SaaS company can be broken down into the above five events. Managing these events is the key to integrating a billing system with a SaaS.

Subscribe?
This is the first leg of the journey that the user takes with the subscription. In this step, the customer has just signed up for a subscription which needs to trigger an automated process.

From the point of view of DevOps, these are considered “Day 1” operations. These are the steps that are considered “provisioning” after a service is requested, such as the installation and configuration of software.

testing
In the trial phase, a customer has subscribed to a service but is not paying until their trial is over.

About 75% of SaaS companies offer a free trial. Although free trials are almost guaranteed to bring you more paying customers, one of the hardest things about offering them is deciding what happens when a customer tests without adding any funding sources. ends.

At this stage of the service lifecycle, a company will need to build logic around tests that, upon termination, will restrict access to an application and alert the customer that they need to pay.

Many SaaS businesses support multiple levels of service. If a subscriber pays a premium, he has access to additional features. This is considered a “Day 2” operation, actions that can be taken after the provision of a service that affects the end user.

While this usually takes the form of strict pricing tiers, sometimes customers pay “per user per month” or have a “limit” that will trigger higher rates if passed.

There will also be some sort of process required to reach out to your former customers after cancellation. It is recommended that the cancellation triggers a process that sends an automated email to the former customer, perhaps with an effort to recover the customer or a feedback survey to see what reasons they have for canceling. can.

Subscribe again ️

When a former customer decides to return after cancellation, a company cannot go through the original process to subscribe them as a new customer – they would need to reactivate previously terminated access. so that they can retain all their prior data.

Some complex scenarios may include limited time discount codes for resubscribers, a free trial, or as part of another service as part of a combo deal.

Conclusion

The key to selling software-as-a-service is to link the software to a billing system that can support the lifecycle I just described. Being able to automate this process is a boon for businesses, as manual processes are one of the biggest barriers to scaling up.

Trying to manage the challenges of SaaS billing? Let’s talk.

We address the challenges that SaaS companies face when billing customers by providing easy integrated hooks that can trigger automated processes.

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