Andrew Culver — "Failed Payments: Fighting the Fly in The Recurring Revenue Ointment"

(This article is part of the MicroConf 2015 Recap. Want to explore more talks from the event? Go back to the Recap Hub)

Main Concept

Failed payments! And how to rescue your customers (and your revenue)

Key Points

  • Recurring revenue is wonderful!
  • Failed payments suck!

Talk Recap

The Dream

  • Recurring revenue is wonderful!
  • The dream? Build a recurring revenue business.
  • As you build a business, people don’t stay around forever.
    • ….10% of failed payments is common!

The Solution

The Customer Experience of a Failed Payment

The Billing Cycle

  • Decision is made way before you have a failed payment
  • Monthly billing have their own cycle — they continue allowing a lot of potentially ‘failed’ charges (due to expiration) date to go through
    • 70% of cards that expire still work after the expiration date
  • Annual Billing — Creates an influx of revenue into a business
    • You get to realize a lot of revenue right away that you otherwise wouldn’t have to have
    • Eliminates potential of failure
  • Overall failed payment churn can be lowered by switching someone to an annual plan
  • Switching to quarterly billing continues neither of these benefits; worst possible solution. 

Automatic Credit Card Updates

  • 70% of all cards that are due to expire are automatically updated via an account card updater
  • Churnbusters doesn’t reach out to people on the basis of the card expiration date
  • If you’re on a payment processor that doesn’t do this, switch to stripe

Reattempted Schedule

  • If you attempt a card 3-4 times over the course of a week, 20% of those cards will work

In-App Notification

  • Notify them in app
  • Potentially block them in app

Emails!

  • Reach out on a schedule that makes marketing sense
    • 2pm in the afternoon, no 11:59pm when the payment fails
  • Send 3+ emails
  • Mix up the content, text, etc, of the emails (standard email marketing stuff)
  • Send from personal email addresses
  • Have a massive Call to Action (more on this below)
  • Include a phone number in the email; that’s someone who wants to pay you money

Phone Calls

  • Call people!
  • The process of calling people has triggered a 50% increase over just sending emails
  • Get a voicemail? Leave a voicemail.
  • Then! Send them an email.
    • Have a ton of templates that you fire off after the call w/ a CTA and a Link
  • Be non-critical
    • “This happens all the time”

Text Messages

  • Sometimes works, sometimes doesn’t work
  • Tested at major scale, failed

Update Information Form

  • Don’t make people sign in for this
  • The button in their email should get them to a page where they can update their payment information without needing to log in / getting them to reset their password

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(This article is part of the MicroConf 2015 Recap. Want to explore more talks from the event? Go back to the Recap Hub)