Common credit card declines & how to prevent them

Hi. This is Laura Lively with payments ed, and I am very excited today because we are kicking off the inaugural innovation showcase.

We know that twenty twenty has been a year, and there's not really kind of the opportunities potentially to, be able to meet people with, you know, with that might have some great solutions that you might need for your company. And one one of the things we're gonna be doing over these next few months is introducing, some very special services to you.

These are our advisors on the payments ed board. And what we're going to be doing today is I'm gonna have Rick Curley, Danielle Gottkes, as and her team, as well as, Brian, from he's a merchant. He's with Output. And so we're excited that you guys are gonna share your story and a case study with us today. And so, what we will do is towards the end, when there's time for q and a, if you all can chat those to me, then that will be great. So I'm just gonna turn this over to Danielle.

Alright. Thank you so much, Laura. We're delighted to be here.

We have about an hour long session designed for today. Brian and I, are going to have about half an hour conversation, about Output, about how he started experimenting with payments as as a GM at Output. And later, we will migrate to to a demo with Danny Stein, our our internal expert in showcasing, the platform. So without further ado, Brian, will you please tell us a little bit about yourself and and output?

Yeah. Sure. Thank you so much for having me.

So I am a general manager at a company called Output. We make music production software. So music producers, film composers, musicians use our products to make music.

We have we started in two thousand thirteen with selling perpetual license software. You would pay two hundred dollars and get your product, and you'd be on your way. In two thousand eighteen, we launched a subscription product called Arcade, and that's what leads us here to today.

And, my role in the company has really been as general manager, it's quite broad. I am handling, you know, general all operations of the company, HR, finance. And when the time came for payments, it ended up in in my lap, and I've been the de facto payments experts at the company.

And I was the one who brought on Recurly and and Adyen and such. So, yeah, and here we are.

Very good. Very good. So I have a number of questions for you, but I realize that some of the folks in the audience may not necessarily be, aware or know who Recurly is. So let me give you everybody a quick plug, and then we can migrate into the q and a.

So, Rick Early, we're a subscription management and billing platform. We work with some of the most innovative and fastest growing subscription companies in the world. Output is obviously one of those. That's why we have them here. But some of our other customers include CBS Interactive, now Viacom, Sling TV, Twitch, BarkBox and FabFitFun, Cinemark, Chart Chart Mobile, Unbounced, Lucidchart, and and many others.

Some of the things we specialize in, as as part of offering this comprehensive platform include, capabilities for subscription life cycle management. This is where a merchant can, set up, their pricing and plans and different kind of add ons and offer coupons and and gift cards and and manage all of those efficiently, test them easily, and so on. We also have also have a slew of capabilities to automate recurring billing and payment operations, supporting fixed and variable and metered and even one time and quantity based billing models, offering also robust tax support capabilities, and so on. And our bread and butter is minimizing involuntary churn. This is gonna be a big topic of conversation, for us today.

We know churn is a is a is a huge problem for subscription based companies and involuntary churn specifically because, this is where you have subscribers who actually love your product, leave because of a payment failure. So we're gonna be digging in into this, further in our conversation with Brian and further, further down in the demo with Danny Stein.

Alright. Brian, so back to you.

You've mentioned you've mentioned you are you were the only payments specialist at at Output until recently.

So this was probably one of the reasons you have chosen Mercurial. You know, I'd love to understand what kind of efficiencies and agility, did Recurly give you as as the sole person who managed payments, the current payments, and output until recently?

Yeah. Sure. So it's probably good to understand how we we got there and a bit bit of the origin story. So when we launched our subscription product, we launched using WooCommerce subscriptions, and we had Braintree and PayPal as per processing payments.

When we launched in June two thousand eighteen, we put a hundred day trial on the subscription to try to as a marketing, the, idea to bring in as many users we possibly could. Well, what ended up happening is late September two thousand eighteen, we started billing, and everything started failing.

Incredibly high decline rate. We had very little insight into what was truly happening, with those payments. We had little functionality in terms of dunning analytics, and so that created the sprint of, okay. We need to fix this, and get a control on involuntary churn and also get control on subscription management and a bit more reliability, I would say. And so that led us to Recurly, mainly for a few different reasons. One one, the reliability factor of being able to bill, on a regular basis without any type of hiccups, and also payment, strategy and having options to create a payment strategy.

So, yeah, that's so since then, we've been utilizing a variety of recurring payment options, right, with gateway routing and, having multiple gateways, and AB testing gateways against each other, quite quite a variety of things. So, and then up until to the you know, recently, we've we've now we're starting to build a payments team to then take those tools and really focus on them on a daily basis to continue the progress of improving involuntary churn.

And so, yeah, it was it was a big it was a mixture of it was a moment of we this needs to be fixed. We need a solid partner here. And then, and then from there, let's utilize everything we can.

Alright. Okay.

And and you and and then I recall when when you were preparing for this, you chose WooCommerce because you you're operating the rest of your, the rest of your store, the rest of your offerings through WooCommerce, which was a great fit for for that purpose, but not necessarily for subscription management.

Yeah. It was, I would say some you that's exactly right. I mean, we were we our website, it operates on WooCommerce. That's how we sell our other software, and we have some hardware products.

So when it came time to do subscription, we're like, hey. It's already built into our site. We can add WooCommerce subscriptions. I would say it's not a platform for scale.

Right? It's, and that's when we start having issues is when you try to you reach a large volume.

It just it couldn't handle. So, yeah, that's that's why we started there. It was simply the simple solution where our website was at the time.

We yes. We we see this very often with with a variety of customers who come in to us because they either have a solution that they've built internally that worked well for them until they've reached a certain threshold of, of a payment volume or because they are migrating from, you know, from a traditional retail or, you know, one one type of a sale environment into a recurring or into a subscription model, where the previous solution no longer works. So it sounds like a pretty pretty common use case.

We've talked quite a bit about your, the way you've been the way you've been testing different gateways. I know you've done quite a number of AB tests. Can you tell us a little bit more about that, as well as trying new payment methods? I think that's another thing with, you've done quite a bit. It's, GoreCard list, SEPIV versus ACH. So, walk us through that, please.

Yeah. Sure. So shortly after moving to Recurly, we wanted to take advantage of the payment gateway routing, which is the the ability to route a transaction to any gateway you would want for whatever reason. And so what we the first test we did actually was Adyen versus Cybersource.

We did run it for about a month. It was pretty clear of who the winner was, and we ended up so what how we ran that test was simply at the time of subscription sign up, you fifty percent went to Adyen, fifty percent went to Cybersource, and we we assign basically the gateway code, the recurly gateway code of each of those, the the API. And that's how it then recurly automatically funneled those transactions.

So we just ran fifty fifty for about a month and then went back and started reviewing results.

It was quite clear what what the winner was in that scenario. We've we've also AB tested in a similar fashion, transactions in Spain as Adyen versus Vantive.

Mainly, we were trying to identify a country where there was significant, a pretty low operate on the on the transaction, so see could we edge it up.

And we ran that for probably three months and then then reviewed, reviewed the stats.

And we've done, in terms of, yeah, alternative payment methods, we've been experimenting with most recently GoCardless. GoCardless became partner of Recurly, I was this spring. And so we we jumped on that for the ability of you know, GoCardless focuses on direct debit transactions. So, we started with SEPA, which we launched in July of this year, and also ACH, which we launched in August.

And the idea thinking that a direct debit transaction would have a higher success rate over time versus a credit card transaction or a PayPal transaction.

The we're still a little early to determine if that is remains true.

Mhmm. But that's we're trying to, yeah, focus on what are the local payment methods, what's preferred in each territory.

Mhmm.

We've another example is we've experimented with prepaid cards in Italy and accepting them, not accepting them, what type of prepaid cards. Seventy five percent, I believe, of their transactions in that in the country are prepaid.

And so we're trying to take it from a territory by territory basis and look at what are the preferred payment methods, what do we have at our disposal, and just chipping away, right, and Mhmm.

Testing and seeing what works. And if it doesn't work, we we we stop doing it and keep moving on. If it does work, we double down.

Yeah. Yeah. Yeah.

I recall you were talking about prepaid cards because, you know, in the beginning you had quite a number of users who were on prepaid cards, right, that you determined to either discontinue or to migrate. So walk us through that, please.

Yeah. Sure. So when we moved so involuntary was a massive issue before moving to Recurly. And when we moved to Recurly, we saw a significant decline in involuntary churn, which is really, I think, attribute to the reach smart retry logic inside of Recurly having more payment methods. Really kind of tightening up our payment stack, helped our success rate overall.

But when we so shortly after moving to Recurly, we were then continue to analyze what are the payments that are failing and what characteristic characteristics are there between them. And we saw prepaid cards were a significant problem.

You know, if we were to not accept prepaid cards, we could cut much of this in half. So what we did is we worked with Adyen through their their fraud tools, and we blocked prepaid cards. However, we did not want to block any prepaid card that was successful prior to that Mhmm. Action. So we then took all of the transactions that or accounts, I would say, inside of Recurly that we're successfully paying using a prepaid card, identified them, and then changed their gateway codes inside of Recurly from Adient to Braintree, because we were working with Braintree on our WooCommerce store. We just added it as a gateway, moved though all those accounts over so that they would not be affected by this fraud block.

And then it initiated the fraud block and then stopped collecting prepaid cards while the the old older prepaid cards were continuing to try.

And it worked quite well. And so and then what we've evolved on that, which I mentioned a little bit earlier, is in Italy, we are now accepting prepaid cards, but only reloadable prepaid cards.

Mhmm.

Mhmm.

And so we're we're still a little bit early to see if if what the, true results of that are.

But, you know, we're it's another lever we're we're playing with.

Right. Right. Right. So since you've been doing a lot of this, testing and iterating, testing different gateways, right, testing different payment methods, How easy is it, to do all of this, through Curly?

Yes. I mean, it's quite simple, really.

You know, there's it kinda depends on what you're doing. Right? We've it's very easy to move transactions from one gateway to another by currency, for example, or by type of card. You know, we had in the early days actually, when we first did Recurly, we onboarded Adyen. I had not realized that JCB was not activated inside of our Adyen account. Adyen was then the the primary gateway in Recurly. JCB transactions just started failing immediately.

And but however, JCB was approved at the time for Braintree. So as an urgent method, I simply deselected JCB from the admin gateway, selected it on Braintree, and then retried all those payments, and they just rerouted it all went through successfully.

So those types of actions are incredibly quick, and by currency is incredibly quick. The gateway testing and routing is done we do it through the API, on our side of our website. So it, you know, it our developer is the one programming and and writing the code to to make that happen.

And when we've had to change gateway codes, our programmer does the same thing. He just changes the script. So we give him a bunch of account codes, and he runs a script with the the gateway change. And then he's he gives us a thumbs up, and then we make sure that it was actually working. But we've we've never had a a hiccup. Yeah.

We love we love hearing that for sure. And, Daniel, later on in the demo, we'll be able to show you some of this as well so you can see how, very user friendly and intuitive the interface is.

Great. So as part of this, you know, test and iterate, analytics plays a big role. So we'd love to, we'd love to learn and would love our audience to hear, you know, what kind of dashboards are you using, you know, specific data that you're looking at. Please tell us.

Yeah. Sure. So the trial performance view inside every curly is really, I would say, the the bread and butter for us.

We're we're really looking there's probably two main dashboards inside of Recurly that we use very frequently is trial performance and also billing. So trial performance, we're looking on a daily view. We're paying attention to the payment column of which payments are currently in dunning, what is, and during that dunning process, we can kinda see a trend and see if anything went wrong at any moment. Like, oh, is there something significantly wrong with whatever it may be, like a gateway or, you know, we we can process, and we can then by looking at the trial performance daily view, we can see every single day the current status of dunning.

And that is incredibly helpful. And there's been a few moments where there's been a red flag of, okay, why is today suddenly way higher on this particular, you know, data that's in Dunning? So, we use that very, very frequently. And we're also used you know, for recurly on these reports, you can export.

And so what we're doing quite often is we then look in the day the daily view, get a quick view, hit export, and then we can dive deep into Excel and start doing our pivot tables and stuff.

And then billings as well as, you know, we can look at a previous period and see where we stand any any day on revenue.

That's incredibly helpful.

Mhmm.

So you're using you're using combination of our of our out of the box reporting as well as as well as your own?

Yeah. I think, you know, it just depends what type of, what granular detail you want that particular day or what you're trying to solve for.

So in terms of a daily basis, we're, you know, we're just looking at the the analytics, and, you know, we can look at a monthly view. I believe it's weekly view or daily view. We often look daily.

And and then, yeah, when there's a particular item that we want to dive deeper on, we can hit export and start possibly merging that data with another system and so on and so forth and and starting to analyze our entire business. Right?

Performance on the in the product is another example.

Yeah. So I bet I bet your product team, not just not just you yourself, but, right, your product team is probably looking quite a bit at, planned performance, subscriber, subscriber metrics, things like that.

Exactly. Yeah. And so we we are now we're we're getting our data data stack under control, and we recently moved to BigQuery to warehouse data. We use Amplitude to measure product analytics. We're now connecting the dots of recurly data, Amplitude data, understanding activity inside of the product, how that is affected by, who these people are, when do they sign up, are there are there subscriptions active, and so on so on and so forth. So, yeah, we're that is an area that we are actively improving, and what we're doing is pulling recurly data into BigQuery so that we can then visualize it and do mix it with other systems.

And, yeah, it's been very helpful, and we're excited for once it's, like, the full stack is actually built out.

Great. Great. Great.

Another topic we briefly touched on is is involuntary churn. And so I know you have used, recovered around forty five percent of, those customers that would have potentially churned if, if we weren't able to recover those transactions.

And you've been working with us, I think, for about a year and a half, almost two years now, which is so so that's pretty incredible.

Tell us a little bit what's, what that process entails.

Yeah.

I mean, so much of that is so there's there's a a shelf of improvement, which was when transitioning to early. And so much of that is in the smart retry logic, which was not happening prior to to Recurly, improve Dunning customer communication.

And then so there was a a shelf of improvement. And then it's the game of inches, right, of running all of these experiments to just kinda edge yourself up, one by one. So it's been a a a mixture of Recurly's native features and and behavior of dealing with payments, plus the variety of experiments that, you know, I've mentioned that we've been changing.

And one by one, we, you know, continue to improve.

And, like, at the moment, we're seeing a churn increase since COVID, right, involuntary churn, which I think is probably industry wide, and I'm sure people are discussing. So now we're trying to figure out how much of this is due to COVID and, you know, and people's payments just simply failing, or is there a larger issue? Is it an issue tied to growth? Because we've been growing. You know, we've grown a hundred and fifteen percent year to date.

Mhmm. Kinda.

And so there's there's a lot going on. And, I think those those two items is what we're trying to figure out. So that's what we are currently hiring a a payments team to build out and and, like, try to tackle this problem of, you know, okay. Let's not lose any any ground we gained.

And is it in our control? Is it out of our control? Is it, like, where, you know, is it the probably a mixture of the of the two? So yeah. But it's it's really much of you know, I think payment success is is just chipping away at trying experimenting and making small gains, and then over time, it's big gains.

Yeah. Yeah. And it and it's a combination of things. Right? As you said, it's it's a combination.

It's it's donening. It's having, a proactive account updater. It's utilizing machine learning models. Right? It's it's optimizing and playing with different gateways.

So it's it's never just one thing. Right? So it Yeah. And having those tools, at your disposal as part of as part of one platform is also, I think, what what makes it successful.

Yeah. And we've we've also benefited from there's a relatively new recurly feature called gateway failover.

Mhmm. And so give a highlight, Anne.

Yeah. We have, benefited from it where, you know, our say, the primary gateway is has an outage for a moment, and it will just automatically spit those that transaction to a secondary gateway.

We've benefited from that a few times.

And, you know, those those items, it it plays a big part in the overall picture. Right? Like, it's it's not massive. You're not making massive improvements or massive changes. You're making one at a time and then they they compile and and you at the end of the day, you see a great improvement.

Sure. Sure. Sure. And that's what it takes to operate at scale. Right? You have to you have to optimize and and and, you know, those things, one by one and and make those incremental improvements.

So absolutely right there.

Alright. So I think that brings us, probably to a time where we would love to invite Danny back, to give a demo of Recurly. Danny, are you there with us?

And Brian I am.

Many, many thanks. Please stick around because I'm sure there are gonna be all kind of questions coming in, through the demo or perhaps even after the demo. We'll have probably ten, fifteen minutes for that. Please please stick around.

Sure. Yeah. Absolutely.

Alright.

Well, hello, everyone. I am my name is Danny Stein. I am a sales manager, here at Recurly.

I wanna share my screen. I think I may need to be added changed to the presenter. So, Laura, if you wouldn't mind giving me presenter privileges, I can share my screen, do a little demo.

It's on its way to you now.

Perfect. Alright. And alright. How's that?

Yes. Beautiful.

Alright. Well, again, my name is Danny. Really excited to to show you the demo today and and get in. I, sort of I'm a nerd out on on these things and and payments and and been in the the payment space for a couple of years now. And so I'm excited to show you some of the things that Brian talked about and, you know, and get into the Recurly platform a little bit.

And just gonna show you how easy it is and and how, intuitive the UI is so we can we can just get started there.

And so while we're on the subject of the payment gateways, I think Brian brought up a really, you know, a couple of really great features that Recurly allows you to do, pretty intuitively. So, we'll use AgIn because that's the, the gateway that that Brian was, alluding to that he used. So, we're gonna make up some some credentials here, but, essentially, Recurly has already built out all of these integrations for, for the various gateways. So I go to Adyen. I'm approved by Adyen. Now I can go in here and I can enter my merchant account information and all of all that. Am I enabling the gateway?

And then, like Brian said, certain credit card types are gonna be accepted.

Maybe you only wanna run, certain credit card types through Adyen and and there's other options that you wanna keep for for other gateways, for example JCB. So let's unselect JCB because we're gonna run that through Braintree.

Then we'll go in, we'll select our currencies. So we're gonna accept the US USD, we're gonna accept Euro as well, and let's accept British Pound as well. So there are, I want to say, a hundred and twenty two, I believe, hundred twenty five, available currencies in early.

And so, you yeah. I I don't think we have we've hit a currency yet that we, that we don't accept.

And then, you'll go ahead, add payment gateway, and there you go. You're already set up with that gateway. Now the, one of the features that that that Brian was talking about that that's been helpful for him and in a number of our merchants is gateway failover. So what this allows you to do is you'll add an additional gateway, so let's call it Braintree in this case.

So you have Adyen and now Adyen for whatever reason has five minutes where it's down. It'll automatically fail over those payments to Braintree, then when Adyen's back up or whatever your, your primary gateway is, it'll flip back over automatically without you having to do anything. And, you know, where this really comes into play is Black Friday is coming up or Cyber Monday, you know, on, the first Sunday of NFL football. A lot of transactions running through.

Five minutes down can mean thousands hundreds of thousands of dollars if it's at the right moments or I should say the wrong moments. So, it it's really important that, that you have that backup and and and Recurly is able to provide that for you. So, we've set up Adyen as our our gateway. Now we can go in and we can configure our plans.

So I've created a plan for us, A plus Software Gold package. Now Recurly works with a number of industries from b to c to b to b to b to b to c, and software, SaaS, is, is a is a high percentage of of those. So I went ahead and created a software plan. So I will go in here and show you what's, you know, kind of how you can tinker with the plans and and and actually add something on here as well. So, this is a plan that's gonna be charged monthly. It's two ninety nine, a month, and you can see that we can actually, select a specific price if it's US dollars or maybe it's, three hundred fifteen, euro if we're if we're changing it out or or maybe it's less than euro because of the exchange rates. You're able to control all of that within Recurly.

You can select the term lengths, all of those sorts of things and, the plan add ons is really where you get a lot of flexibility in terms of creating that plan.

So I went ahead and created an add on called seats, so you're able to select different pricing models. So this one's tiered, and so up to ten seats, it's fifty dollars to see. From eleven to twenty, it's forty five, and on and on and on. And you can even go in here and test out, okay, if somebody wanted to buy thirty five seats, what would that cost? Alright. And it goes through all the different ranges.

There's a number of different types of usage based, and, I encourage you to to log in there and try it for yourself.

But suffice it to say, Recurly is able to handle a number of different usage based scenarios, or, you know, seat based scenarios and that sort of thing.

One of the great features as well is being able to add items. So rather than coming in here and creating a new item for every single plan that you have, you can actually create of, you know, a various items here. So there's a number of different ones. Let's check item number one.

You can do that as a fixed price tiered, however you want to do it, and it's going to be two hundred dollars. Now you can add that on as an option. So, again, just really highlighting the flexibility and the ability for Recurly to kind of go whichever way you've set up your business and Recurly is really just a vehicle to, to enable you to accept payments and make sure that your payments are running properly and and you're getting the money that that you've earned.

So again, we've, alluded to free trials. You set up a seven day trial. You could set up to a hundred day free trial. It's up to you.

Even past a hundred days. Set up fees, all of that. Additionally, there's customer emails automatically attached to, that that plan. So when and editable as well.

When a customer signs up that email goes out automatically, nothing manual you're having to do on your end so it all those processes are happening happening seamlessly.

So we'll go ahead and save those changes and now we've created a plan. So oh, well, I probably did something wrong regardless.

So we've created a plan, and, there's a couple of different ways that you can, charge your customers. I won't get too deep in the weeds here on how those work, but essentially, we offer hosted payment pages. So those are pages hosted by Recurly for you to have a checkout process that would be linked from your page. Or you can utilize Recurly's, JavaScript library or Recurly JS, to create your own custom checkout page, which is what many of our merchants will choose to do to really have that custom checkout flow. I'll give you a a little view of what the hosted pages look like.

And so, you know, your customers would come on here. You're able to customize this and and add a logo and and a background color, but they would come in here. They could log in. They could pay from here, and and and be, you know, automatically charged and entered into a subscription.

If you do use the JS option, you can make a look however you want. We have, merchants from streaming to physical goods to SAS that are are using our Recurly JS to create a customized checkout that, that matches their brand identity.

So really quick wanted to touch on how our accounts look and all that and, then I'll go ahead and and, show you our analytics.

So Johnny Appleseed went ahead and he signed up for A plus software, the gold package. Now he purchased, let's see, thirty twenty two seats, with, with the gold package, you know, obviously for his company.

And, and so he so you are able to go in here and see the full picture of, of their subscription right at a glance You can also see all their charges, their invoices, their transactions. He tried on one credit card and you can see that it failed, then he went back in, entered a new credit card that was successful, and the charge went through.

You can also edit any billing information here. Let's say he calls into your support line then they need to fix their their credit card, you're able to do that but even more ideally you can actually send him a link to to update that that billing information credit card or bank account really easy. You send that over and it's a PCI compliant secure, field that he's able to enter.

Before I move away from the accounts, I wanted to highlight one thing because, we talk a lot about involuntary churn, but Recurly also really supports, your business's voluntary churn. So that churn of a customer's deciding that they wanna move away from the product.

And the way that we're able to do that is by offering, you know, a couple of different features but the biggest one is our pause subscription feature Now, what this allows you to do is pause a subscription. So let's say a international global pandemic hits and you're, you need to pause, your service for a number of months, because you're not able to provide it, and maybe it's an in person service, whatever might happen. You can go in here and say, we're gonna pause subscription for six months.

So that's one way you could do that yourself or a customer could log in. They could say, you know, I just don't know if I'm gonna use this service anymore.

They log in and before they go to click cancel, maybe a pop up comes up and says, would you like to pause instead? They could select to pause for a number of months. Now you're keeping them on the platform. You're keeping them as a customer, but you're also allowing them the, you know, the time where they don't feel like they're using and and they're not getting the service.

So rather than losing the customer, you keep them on. After six months, it'll automatically bill again. So on June seventeenth twenty twenty one, billing will resume as normal. So that's one of the ways that we help, our customers with with voluntary churn.

Yeah. Dani, I'm just gonna jump in quickly. Yeah. I'm I'm glad you highlighted the specific feature because this has been hugely popular among among a subset of our customers exactly for the same reasons you've highlighted.

The pandemic is here. Right? A lot of their venues have been closed, and so customers are not able to visit. And so rather than lose them out outright and then try to reacquire them six, seven, eight eight months down the road.

Right. A lot of them have proactively reached out to their customers and then put the pause, put their subscription on pause, generating actually quite a bit of goodwill, in the in the process as well.

So Yeah.

Yeah. Thanks for highlighting that, Daniel. I I think that, you know, obviously, we created this feature before, we knew there'd be a pandemic, but, you never know when you're gonna need to pause. And so, it's been it's been a feature that a lot of our our merchants and and I've been hearing have been, really happy that that was available already and and have taken advantage of that.

So, you know, just to to wrap up on customers, you're able to break it out in a number of different ways. You can look through transactions and you can see successful, declined, fraudulent, pending. So So a lot of different options that you have here to be able to slice and dice how you look at your customers. Maybe you want to see it just by invoices and what's paid, closed, failed, that sort of thing.

So finally I want to get into our analytics. So as you can see on the left hand side, we have a full suite of analytics that that really allow you to, you know, see different pieces of your business and and how, how you're doing. So I know that Brian highlighted a couple that he uses a lot.

I wanted to give you the visual. I'm a visual learner myself. I can't I can't understand anything unless I see it. So, we'll go ahead and take a look at this, the trial performance.

So the the trial performance is another way that we support our customers, with voluntary churn as well as a better understanding of what is what what are you offering with your free trial.

So we see the trial conversion rate, how the how those trials are doing over certain time, you can change it out by plan. So maybe your gold plan is the trials are not converting at the rate you would like, but your silver plan have very high conversions. You can start to assess why that might be.

Again, and then trial subscription status, so those that converted, those that canceled, they didn't have billing information, they had bad billing information. All of those things will be tracked here so you can get a good picture as to what, you know, how your trials are doing.

The next one I wanted to highlight was actually our subscriber retention.

So if your subscriber retention heat map looks like this, you're gonna have to adjust how you're, how you're doing your business, but we wanted to show the full gradient of what it looks like.

And what this is showing is by cohorts, so those that sign up in March, February, January, how long are your customers staying with the product? So you can get a picture of at six months, we're doing great. We have, you know, a relatively high retention rate, amongst our our customers. But by the fifteen month mark, we've lost sixty percent of our customers.

That's not great. We wanna be able to, retain those customers for years ideally, so that that lifetime value is increased. So this gives you an idea of, do we have to be maybe making some changes around the ten, twelve month mark to keep those customers on? Are we doing promotional activities?

Those sorts of things.

Brian also alluded to the billings, the billings tab analytics, and so you can see the the total net billings and and break it out in a couple of different ways as well.

So that is, you know, this is, this is very useful just in terms of a day to day, checking in on the health of the business.

Another way to measure our churn is is our churn analysis analytics.

So you get subscription churn reasons, why did a customer churn, canceled, they didn't pay, the trial ended, could be a whole lot of reasons there, and then you'll also get the voluntary versus involuntary churn rate. And obviously, our our ideal is that it's looking a lot more like the right side of this chart, where both of those are going down with the support of Recurly and and our involuntary churn methods.

So our Plan Performance tab, I won't spend too much time on here but it gives you an opportunity to AB test and look head to head with that with KPIs, how your plans are doing against each other. So once, doing really, strongly and another is not, you can start to see, is there what's the growth, what's the churn rate, and and get a good picture there.

And then our recovered revenue and dunning effectiveness are the last analytics tab that I want to focus on because this gets to the heart of our, our retry logic and how we support our customers with involuntary churn. So this is showing you our, account updater, retries, and expiration date forwarding, and how those can affect your business and, the return that you're getting, the sort of return on investment of Recurly.

This is one pretty big piece of it is is the recovery. So, we recover seventy percent of all at risk transactions. So those are transactions where the card has the card has either declined or has expired or the expiration date is passed or there is a, you know, fraudulent event on the card and so you have to cancel it and get a new card, we're able to support a lot of those methods through our retry and and dunning methods so, that you are not losing customers because a credit card expired. I know know that happens to me all the time. My credit card expires and who knows what I've been subscribed to and then I have to go back through all of them and and re sign up. This gives you the opportunity, to to retain those customers without having to, to reach out.

And then finally, you're done again.

An interesting piece of data there again. I'm done. Dani, apologies. Apologies for that.

Go ahead.

Yes. Yes. We've actually recently run a test with our data science team, and we've been able to see that, subscribers who would have otherwise churned due to, failed transactions tend to stay on average for six months. Right?

So you're not just recovering that customer for that one month. They tend to they tend to say six months. Right? So it's six months of revenue.

That's what you're getting there, which is incredible.

Yeah. And and it's compounding. Right? So, yeah, thank you for pointing that out, Daniel, and our data science team would be mad at me if, mad at us if we didn't bring that up because they're they're doing the hard work there.

So yeah. So, so there, so, yeah, it's compounding. So it's not just the the, payment that you save in, November. It's the payment that then goes in December and January and February, which is which is invaluable.

Mhmm.

So the last one I wanted to touch on is our dunning effectiveness. So dunning is those email notifications when a transaction fails. So if those, if our retry methods, are unsuccessful in recovering the credit card, we're able to send out emails on on your behalf that you're able to customize without go on a set, process that that you can, change, add emails to, take away emails from, change how the the end result is. Is the subscription canceled or does it stay alive but past due? And all of those things are are customizable so that you can try to recover as much as possible, as sort of that last step of our, recovery process.

Now the cool thing about this analytics tab is you can actually track how well each version of your dunning process is doing. Let's say maybe your dunning emails are are not hitting and they're not as successful as you'd like, you can tweak that, the wording, you can tweak how often they go out and maybe version two, version three, those those numbers start to go up and up and up and you can track that along the, the process and and the calendar.

So, you can kinda get a feel for, okay, this is the type of wording and messaging that we wanna use to to best recover transactions because every industry is different, every company is different. The wording is gonna have to be different if you're talking to, a b2b if you're a b2b company versus a b2c company and so we give you that flexibility.

And all of that together makes up the Recurly platform. Obviously, I only it's the tip of the iceberg. You'd have to get in there and and really start to, you know, click through all the different features to best understand how it supports your business. But, you know, that I wanted to give you a quick snapshot there and, and I'll I'll send it back over to, to Danielle.

Alright. Very good. Thank you, Danny. Thanks so much. If anybody at the audience would love to see the platform, in person, you can either do that directly on our website and get free access to the sandbox, or we can recruit Danny one more time to give you a personalized demo for your business as well. So you can Yeah.

You may have been able to tell that I enjoy doing the demo. I like doing it. It's fun. So I'm always happy too.

Great. So now is the perfect time to migrate to questions from the audience. We're about we have about ten minutes or so. So would love for you guys in the audience to start posting questions.

Laura, if you can please let us know if if you see any questions coming through. Yeah.

I'm happy to queue some of those up for you.

Question this is probably to Brian, is my guess. How do you determine reloadable cards?

Reloadable prepaids versus non reloadable?

Yeah. Sure. So that's actually a new feature inside of Adyen's fraud tool.

So we we pay for, it's called revenue protect inside of Adyen. That's a it's a relatively new feature that they launched in in May.

Great.

Next question.

Oh, this is a long question. Let me see how I can make sure I read it all. Given that banks take into account a merchant's history through a particular payment processor when assessing risk and determining if a transaction should be declined, Do you have a sense how this affected AB testing between payment processors?

Yeah. So it's definitely that is the risk of running an AB test, I would say, is is exactly that.

I think you kinda have to judge your appetite for for that risk.

It's difficult to say whether a transaction would be more successful or another. I think, you know, probably a sophisticated way to go about that is is maybe testing trying a particular account on gateway a one month possibly and then gateway b another month. There's that's not a perfect test by any means.

But it is that that is definitely a a part of the risk, I would say, of doing that type of test.

Great. Thanks, Brian.

Our demographics are primarily students who like to use the pause feature for school breaks. Is there an ability to pause a subscription ahead of excuse me, ahead of time based on specific dates?

That's a great question.

I, I would assume that you might be able to, to either write in a process that that would allow for that, but, I would have to I would have to ask one of our engineers.

Danielle, I'm not sure if you know the Yeah.

Danielle, I know we can delay, the date on which somebody can be billed. So that's that's one way to do that, I'm imagining. Mhmm.

Right. Yeah. Yeah. For centuries still.

Yeah. Interesting, kind of re of a piece of info that's tied to that from us is we've done pause via Recurly for about a year now, and and it's been very successful. We we offer one month. At the beginning of COVID, we offered pause. But, also, if someone went through a the cancel flow and we're voluntarily canceling, we asked, would you like a free month? And we gave them one free month, and ninety percent of those people came back the second month and continued to pay.

So that we we've kind of had a a mixture there since COVID, and it's been very successful.

Nice.

Yeah. And and I didn't even get into our coupons, that that would allow you to do that. But, our coupons are very flexible in terms of free months or trials and that sort of thing. So that that's a great use case.

Are the Dunning emails white label? Can we add company logos and modify things like font, color to properly reflect brand their the company brand?

Yeah. Absolutely.

So, they you're you're able to edit those those emails fully, in in HTML.

So it's, yeah, essentially, you know, the, the the sky is the limit from for the most part.

And that that I would say is true not just to dining emails. That's also true to the host of payment pages as as you've seen from Danny. You know, our ideas, even though you you might be running those early, you still need to be representing your brand.

And and it also provides kind of a confirmation for for the subscriber, for the end user, right, that they're not being rerouted to to to a fraudulent transaction, for example. So that's that's one of the reasons to do that.

Thanks. Somebody's provided some feedback that they love the reporting that was shown. So thank you guys for that.

Just curious if Recurly reporting shows the success by retry attempt.

I I would, I guess, a clarifying question if that's even possible is is do you mean by, like, which which number of attempts? So is it, like, the first attempt, second attempt, third attempt?

Okay. We'll see if we get that answer back in time.

I would I would say, on a more said the latter.

What was the was whatever your second example was, Danny.

Okay. Right. I don't I don't know if you if you have a a real world example of that yet.

Yeah. I mean, we we export the data. So from the analytics panel, there's an exports area, and we export transactions. And then you can actually see the individual transactions and and retry attempts and the success of each of those. That's how we do it.

Yeah. And that that that would be my suggestion as the best way to to go about that.

Another question's come in is is the credit card tokenized when captured on the payment page?

So so Recurly actually stores at the vaults all of our, all of our credit card, data. So, so Recurly is actually the one storing it and not receiving a token from the from the payment gateway.

Happy to get more in more into detail on that, but, but that that's the sort of high level of of how it works, and and that actually allows us to be able to do things, like more advanced, machine learning, recovery, our gateway failover, and and being able to seamlessly move between gateways.

Great. And I think that's the last question that I have. And so I'm excited to, bring on screen, John Agliallaro. If I said your name wrong, I apologize.

John is one of our merchant board of directors, and, he's well, I'll let you decide if you wanna say who you're with or not.

But John has been spearheading this innovation showcase, and I know he has some exciting information about what's coming up next.

We can't hear you right now, John.

Okay. Nope. We still can't hear you. Can you hear me?

But we can't hear you. Okay. Then well, that is John. He is one of our merchant board of directors. And don't you love technology glitches? And John, has been working very hard as we kick this innovation showcase off, and we are very excited about the next two upcoming, sessions that we have. So mark your calendars and we have well, you'll see it coming out from us shortly.

Verify is going to be in for December flash me the date, John. What's the date in December?

December one.

Oh, that's right. It's really close. That's right. December first.

And then, and then we have Ithaca is coming up in January. So stay tuned for those. And it looks like I actually had another question come in.

Oh, is there a visibility into the reason for the off decline?

Yes. I can answer it.

That's muted. I'm gonna mute this.

And we we review that in exports as well. We export it, and you can get pretty granular.

And you also receive what's helpful for us is receiving the reference ID to the gateway. So then you can pull if you need if you can get more granular data from the gateway, you can then combine those reports.

Couldn't have said it better myself, Brian.

Beautifully done, everyone. Thank you so much for, your attendance today. Thank you, our team from McCurley and Brian from Output.

Brian, we hope to see you more at some of our additional payments ed, events. We're excited to meet you. And, again, December first, we will have verify doing one of these innovate innovation showcases, so look for emails coming from me shortly. And everyone, have a great rest of your day.

Thank you all very much.

Thank you. Thank you.

Bye bye.

Thanks.