Four Ways Dunning Management Reduces Churn -
One of the biggest challenges faced by subscription-based businesses is figuring out how to maintain the flow of recurring payment for their company. Because revenue is tied with business growth and wellbeing, any dip in recurring revenue is immediately experienced throughout the entire company.
First Reason: Dunning Management Saves You Time
Having someone in-house manually sending regular reminders each month for all accounts in default has its own risks. What happens if the person gets sick or is swamped with additional work and isn't able to handle invoices? If you fail to send a monthly notice, you're simply prolonging the amount of time needed for you to be paid.
What if there were an easier way to reach out to delinquent accounts and collect overdue payments? A dunning management system automates the sending of reminders to your delinquent accounts on your behalf. If, for instance, a credit card fails an account, a letter of dunning is created automatically and immediately sent to the account. Because your business already is able to automate the process of monitoring delinquent subscription accounts, you are able to redirect company resources towards supporting your primary company.
The second reason is to keep more Cash in Your Pocket
Recurring payments are great for businesses that subscribe because they provide a predictable stream of revenue that companies can use to forecast future growth. However, the process of collecting these payments is riddled with their own set of challenges. Credit and debit cards that are used to make the recurring payment can be cancelled, expired or become lost, leading to payments being rejected and even a break the customer's service. Making sure you notify customers when their payment fails to process helps ensure your business gets the money you owe for your services promptly.
Built-in dunning capabilities allow companies to create an email reminder that is flexible and can be scheduled for 2, 5, 7, 14, and 21 days following a customer's payment method fails.
Third Reason: Cut Down on Customer Churn
There is no doubt that it's not just harder to acquire new customers, it can also be significantly more expensive also. To cut down on customer acquisition costs you must ensure that your company focuses on safeguarding the current customers base.
Fourth Reason: Improve Your Work Performance
Every business owner doesn't want to be wasting time writing emails or making phone calls to customers asking them to update their payment information. Imagine if you manage thousands of customer accounts and the billing details can become overwhelming.
A good news is that working with an ecommerce partner with automated dunning features can streamline the entire process. Rest easy knowing that customer-friendly reminders are automatically being delivered on behalf of you. Whether your customer needs to change their current account information, or wants a friendly reminder to make a recurring payment, the dunning capabilities of's allow you to stay up with your customers.
Do you want to know if your subscription-management software has the capabilities that your business needs? Download our no-cost ebook 8 Essential Subscription Management Features to find out.