11 March 2020- 16 min read
11 March 2020- 16 min read
Choosing the Right Billing System for Your SaaS Business
When you’re running a SaaS business, choosing the right billing system software is crucial to your success.
Each individual SaaS business, or even businesses that aren’t in the SaaS sector but that use automated and/or recurring billing, will have their own unique set of billing system requirements.
This means that while the factors of a successful billing system will be different for everyone, there are certain things that everyone can look out for when choosing a billing system.
Let’s look both at the benefits of choosing a great billing system, the features you should look out for, and the questions you should ask yourself prior to committing to a solution for your business.
Today, the best billing software does far much more than take payments and send invoices to your customers. Effective billing software in the modern marketplace can help you with everything from email marketing to long-term customer retention, even allowing you to target specific audience segments with promotions, coupons, discounts, and other offers, and see how many people use them. You’ll be able to review a range of metrics and act to positively influence these.
The best billing software systems will even integrate with your existing customer relationship management (CRM) and ERP tools and allow you to bring more of your business functions together in one place.
The list of systems that our platform here at Upodi is integrated with is continuing to grow, currently we are fully integrated with, among others:
Whether you’re a large or a small business, having a great billing system can supercharge growth and have a positive influence over your whole organisation.
Let’s look closer at what you should be looking out for when choosing a billing system for your business.
Your checkout is the final stage of your sales funnel, converting people into paying customers, so it’s critical that this is effective.
What does an optimised checkout experience look like?
When you’re selling SaaS, it’s likely that you have different subscription tiers and options.
Your billing system software should make it simple for your customers to log in and upgrade, downgrade, or cancel as they wish to.
In addition, your billing system should also be able to be set up to do cross and upselling for you.
If your billing system does this, you’ll save a lot of time and money on not needing a customer service team dedicated to dealing with these issues each time a customer wants to change their account.
Every business is continuously evolving, as a business as well as in the context of the SaaS and any other products and services that they sell.
One of the key components to ensuring your business and its services are tailored to your audience is knowing exactly who your audience is in the first place, and how they use and interact with what you offer.
Look for billing software that allows you to collect demographic information if you wish to. Remember that you don’t want to put customers off with overly long checkout forms, but if you have a way of collecting additional information that will help you to make your business better, you should definitely explore it.
Part of the evolution of your business is likely to be experimenting with pricing.
Your billing system should make it easy for you to change the pricing of your product and then invoice people accordingly.
However, you need to be able to change the pricing for selected customers only. For example, if you have 1,000 subscribers who signed up to your platform when the price was $50 per month, from a service perspective do you want to risk upsetting them by putting up their payment if you suddenly realise you’ve massively undervalued your SaaS solution?
The answer is, of course, up to you, and there are many businesses that include existing customers in price increases.
When choosing a billing platform, ensure you will have the functionality to add whole new pricing and subscription tiers, while keeping those for existing customers if you need and wish to.
Read more about pricing strategies here.
While data shows us that a high number of customers abandon during the checkout stage, we also know that up to 1 in 5 customers who are sent an email after abandoning do then subsequently convert.
Although you should always be looking to reduce your cart abandonment rate through ongoing checkout optimisation, having a billing system that will send emails to those customers who have abandoned during the checkout process is a must.
Of course, in order to be able to do this, you need to get your customers’ email addresses first, so your website in the first instance should be set up so that your customers need to register or sign in prior to being able to access the checkout process.
As with other elements of marketing and pricing your product, you should always be testing your abandoned cart emails and optimising these.
Your abandoned cart emails don’t always need to be offering a discount, either. Simply re-iterating the benefits of using your SaaS platform is often enough, although you could also use these emails as a learning exercise to discover while users abandoned in the first place.
Often, you’ll find it was simply because they got distracted or intended to come back later, so don’t reduce your margins by offering a price reduction as a default position!
Whether you offer your SaaS platform as a “free trial” with full functionality for a specified period, or offer “Freemium” as a pricing tier, your billing platform will have a role to play in helping you to convert customers in these brackets into paying subscribers.
The most effective way to do this is to personalise your communication to users.
Can you craft emails that specifically talk about how users have been interacting with the platform? Can you extend a free trial, or influence an initial move onto a paid subscription with a discount offer?
Use these campaigns as an opportunity to build trust and loyalty with your customers. Think about this before the transactional element, and you’ll find yourself crafting more appealing emails with conversions more likely to follow.
What reports do you rely on and use in your business?
Here at Upodi, we’ve looked at a variety of metrics that are commonplace in SaaS businesses and how to calculate them.
Your billing software should be able to create all these reports for you, giving you back the time it would take you to make those calculations yourself and invest it in taking action to improve them.
One of the most appealing aspects of building a SaaS platform in the first place is the opportunity to sell cross-border and thus have the whole world as a potential customer base.
With this capability comes huge responsibility to ensure that you’re meeting regulatory standards in a range of locations, from the relatively simple things such as processing payments in multiple currencies and processing credit card transactions to potentially more complex issues such as data protection and use of data.
These can be incredibly demanding aspects for a small business, and even for larger businesses, to deal with, and choosing a billing platform that takes care of all these aspects will let you get on with running your company and selling your SaaS solution.
Finally, a fantastic billing system is one that you can plugin, integrate, and use with your website with the minimal level of stress.
If your billing system doesn’t work properly, or redirect users back to your website, it’s your business that is going to suffer. In your customers’ eyes your billing platform and your business aren’t individual entities, they’re dealing solely and exclusively with your business!
Look for a billing system with API’s that allow you get started in hours and reduce the need for complicated and expensive development work to get you up and running.
Find out more about the author and follow them and social media to stay connected with them
Fanny Fredskilde is the Head of Project Management at Bonzer, providing external material to Upodi, that are suited for the SaaS business universe. She is eager to provide companies with the best content and track the development of companies based on her great experience within SEO.
Check out our related posts based on your search that you may like