Scaling subscriptions: Payments and compliance best practices
The digital subscription economy is expected to reach $1.5 trillion by 2025. Both digital and traditional businesses like hotels and automotive companies are shifting to a recurring business model to improve customer loyalty.
As the industry matures, consumers have higher expectations when choosing subscription services, demanding smooth, predictable, convenient experiences–especially at checkout.
In a fast-paced, almost saturated industry, how can your business leverage technology to compete and position itself as a leader?
To answer this question, Stephanie Johnson, Recurly Global Director of ABM and EMEA, and Oscar Wall, Recurly EMEA General Manager, sat down for an exciting conversation with:
Jurrien van den Broek, Head of Sales, Amsterdam, at Adyen
Tasmyn Nicholls, Strategic Partner Manager at Vertex
Joost Van Bommel, Head of Membership Products at citizenM
Watch the full recording or continue reading to get the recurring billing management and best practices to streamline subscriptions at scale.
Subscriptions are the future of ecommerce
Subscriptions have revolutionised the way consumers engage with brands and products. In a world where people seek value and convenience, subscriptions offer a seamless solution that ensures hassle-free experiences.
Take citizenM, for example; this affordable luxury hotel brand has recently launched its subscription service, mycitizenM. The company identified that price security and availability were the pain points their customers struggled with the most. And so their membership offers a best price and room guarantee, among other exclusive benefits like discounts, premium views, and late checkouts.
When you add exclusive value on top of your recurring product, the value you get in return is loyalty, making subscriptions a self-fulfilling circle.
Recurring payment trends & considerations
You can’t discuss subscriptions without talking about recurring payments–the heart of this business model. According to van den Broek, the biggest trend is digital payments and subscriber wallets like PayPal, ApplePay, and Venmo.
However, while these payment alternatives are easy to deploy and offer convenience to their users, you should consider the implementation and risk implications these may have in certain countries or regions.
Most of the time, companies focus a lot of time and resources on building their payment processing infrastructure but don’t realise how much money they’re losing to involuntary churn due to unprocessed payments.
Tax & compliance implications in subscriptions
Don’t let recurring revenue become a recurring risk. When expanding internationally, make sure you understand what tax rates apply, depending on where your consumer is.
As Nicholls states, the more countries you enter, the more complex it gets. What are you doing to stay compliant?
This is where relying on a subscription management and recurring billing platform becomes key to retaining more consumers and scaling globally. Recurly, for example, has partnered with Adyen and Vertex to help its customers improve their transaction rates and keep their businesses compliant.
How the right tech stack helps you scale
Managing subscriptions is challenging. When you let a subscription management and recurring billing platform like Recurly take care of these complexities, you free your engineering teams to focus on your most valuable asset: your core product.
When you combine the right payment orchestration tools (i.e., multiple gateways and subscriber wallets) with the right churn management capabilities (i.e., account updaters, AI-powered retries, and smart dunning campaigns), you’re guaranteed to increase retention.
Where subscriptions are heading
The shift to subscriptions brings new challenges for all businesses alike. Consumers expect frictionless, convenient experiences across the lifecycle, and companies must be aware of the shopping trends and strategies that ensure long-term relationships.
Are you focused on driving profitable subscriber growth?
Join us at Subscription Sessions, a don’t-miss virtual summit where industry experts uncover the strategies and best practices to scale subscriptions–from customer experience to payments and compliance.