Attention Subscription Billing Merchants: Don’t Do This

Attention Subscription Billing Merchants: Don’t Do This

Each day when I drive to the Instabill home office in Portsmouth, N.H., USA, I pass through a toll booth. Rather than pay the $2 cash at the window, I have a transponder attached to my windshield that enables me to cruise through without going under 70 miles per hour.

Toll collection is the consummate subscription billing model: I drive under the sensor twice a day, five days a week and my bank card (which I always use as a credit card) is billed on the same day each month.

Twice in the last two years, I’ve had to have a new bank card sent to me; once because it was compromised at a major retailer and again because my bank was rolling out cards with the EMV chip.

Indeed, I neglected to update my account with the toll company. Both times. My mistake completely, but I discovered a big flaw in the toll company’s billing.

‘You Have an Outstanding Balance’

That’s not a compliment.

I should be more faithful to reading our mail every day. Most of the time I grab it out of the box after I get home and leave it on a desk. When I did get around to looking at the mail, there were a number of envelopes from the toll company, about 10, a week’s worth for each time I drove through the toll.

At first, I was taken back. It took me a few minutes to realize that I had not updated my account with my new bank card information. That night I accessed my account online and updated my information, and erroneously thought whatever outstanding balance would automatically be settled.

Uh…no.

The bills kept coming, and they were about 7-10 days behind the date of my actual transgressions, so I could expect a few more. Updating my payment information only solved half the problem. I needed to log on to a different page on the toll company’s website and pay the outstanding balance. It’s not the most user-friendly site, but I settled the outstanding debts and, again, made certain my information was accurate.

But it left a bad taste in my mouth.

The Key to Subscription Billing: Communication

Each month, I receive an e-mail that my tolls for the month have been paid via ACH. Here is my issue:

This is 2016. Why then, must I receive an actual letter in the mail, anywhere between 7-10 days after the transgression, alerting me that my payment scheme has been interrupted?  To boot, I am also charged a $1 ‘handling fee,’ whatever that is, for each transgression. Now I am all for keeping the U.S. Postal Service busy and viable, but shouldn’t an e-mail be automatically sent immediately following the discrepancy?

When I’m a day or two late paying my energy bill, I receive an e-mail. It’s a nice (sometimes needed) reminder.

If You Own a Subscription-based Business…

…how do you communicate with your customers? We’d love to know, so please leave a comment below.

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