The essential capabilities of a modern subscription billing system for enterprises

The global shift into a subscription economy doesn't need to be studied by looking at large businesses. The evidence of the shift can be seen through everyone's day-to-day activities. If you have a subscription service for groceries, food delivery, or entertainment streaming, as most people do, you're part of this new subscription-based economy.

Consumers are increasingly preferring to pay for consumption and outcomes rather than ownership. This is fueled by the ease of access and the satisfaction of having to pay only for what they need at that specific moment in time. This shift has made businesses adapt to subscription models in an evolving way throughout the past decade. From the early streaming services to the latest GenAI wave and lifestyle industries, subscription models drive primary revenue.

The priority now is to stand out and cut through the noise.

But how do you do that? Beyond the USP of your service and brand equity, what really gets a boost is your business efficiency. This is because it ultimately powers the subscriber experience, which is today's differentiator. For example, a support team with centralized data can resolve issues in a single call instead of multiple back-and-forths.

It's no secret that efficiency comes with having a properly defined set of processes and the right systems. With enterprises' already mature processes, the struggle lies within execution—in how well those processes translate into systems and into day-to-day activities.

Among all the systems needed for this like CRM, support, and marketing automation, billing sits at the very center of monetization and customer experience. It determines how the revenue flows as well as how subscribers interact with your brand from sign up to renewals and cancellation.

What does a strong subscription billing system look like?

Simply put, your billing system should double up as a CX tool while handling complex backend transactions. To dive a little deeper into what exactly the system should possess, we could split the must-have capabilities into three broad categories:

• Stage 1: Monetization
• Stage 2: Day-to-day operations
• Stage 3: Offboarding

1. Monetization

The foremost thing in the subscription model is pricing and packaging.

The right system supports whatever pricing model you follow or plan to expand into like tier, volume, or consumption-based pricing, and allows you to offer free trials with automatic conversions.

Handling usage-based billing

Usage-based billing can get really complicated right from the setup to revenue recognition, especially if your model involves prepaid credits. Tracking usage and overages, rolling over unused credits, and setting up expiry adds one more layer of complexity. The main metric for the platform here is simple: "how much human intervention is needed?" The answer should be little to zero.

Looking for a consumption based billing system?

Connect with our experts now and check how your usage-based subscriptions can be implemented in Zoho Billing Enterprise Edition.

Promotions

Beyond pricing models, coupons are one of the most leveraged monetization tactics. For enterprises, the need for coupon customization is high. For instance, you might want to give coupons to a few sets of customers. In the long term, such features can help you with granular experimentation.

Experimentation

The system should also help with smooth experimentation and rollouts of new models without causing any disruption to the existing workflows and operations. For example, you should be able to roll out your experiment to a select cohort with price changes and create separate reports on the experiment's performance.

The presentation of the pricing plans

Monetization is not just about backend plan configurations, but involves presentation. It plays a role in speeding up time to purchase (TTP) and also in shaping perception. Your billing system should make this process easy, whether through built-in pricing tables that you can embed in your site or APIs that sync live data. It should also help them see localized pricing without added effort.

2. Day-to-day operations

A comprehensive billing system offers critical levers that keep operations smooth and customers in control.

Enhanced subscription billing ops

Subscription billing operations start with the basics: creating subscriptions, starting trials, adding or removing add-ons, upgrades or downgrades, handling renewals, and aligning billing dates. These are the day-to-day actions customers expect to work without friction. But within each of these fundamentals, the real complexity of enterprise operations shows up.

• Can it apply negotiated pricing to certain customers for select subscription plans? Can this be done in bulk?
• Old subscribers would prefer existing pricing, so can the system show desired changes to the pricing during renewals for only new customers?
• Contracts and plans evolve, so can the system let you schedule the periodic markups or markdowns of the plan price?
• You want the invoice to be voided after three unsuccessful retries, can it help you implement that course of action after failed attempts?
• A subscriber needs a break, can the customer pause and resume subscriptions? Does it let you offer credits for the pause period automatically?
• Subscriptions never stay static, mid-cycle changes are unavoidable. So, can the system automate prorated refunds for downgrades and bill for the additional cost for upgrades in the next billing cycle without manual intervention?
• It's natural for subscription businesses to be spread across channels. Can the system help you manage subscriptions from third-party platforms like Google Play Store and the App Store?
• Can the subscribers see as much information and do as many actions as they can without reaching out to support via a self-service portal?

A strong subscription platform will answer "yes" to all the above questions.

Besides, billing methods themselves need flexibility. It should include advanced billing for better cash flow, consolidated billing for customers with multiple subscriptions, calendar billing for better predictability and internal alignment, and the more common anniversary billing.

See what Zoho Billing Enterprise Edition can offer

3. Offboarding

When a subscriber decides to leave, how smoothly they exit becomes a part of the experience you deliver. Frustration at this stage can quickly turn into negative word-of-mouth. In certain regions, regulations demand companies make the subscription cancellation option as prominent as possible. With an increasing focus on consumer protections, making cancellation as simple as possible has higher chances of becoming a legal mandate.

A good platform extends its abilities through this stage of the subscription lifecycle and makes it as painless as possible. Allowing subscribers to manage cancellations themselves, and giving them a simple way to share feedback via portals can save you time that's associated with the offboarding processes.

Besides, these subscription-specific features, the platform should also have good integration capabilities (along with well-documented APIs). This lets your subscription business evolve without facing obstacles from the very platform that's meant to help.

Zoho Billing: Enterprise billing OS built for subscription businesses

Your focus today should be on constantly evolving your monetization efforts, instead of worrying about your systems' rigidity. Remember, the impact of streamlined operations is ultimately felt in how your subscribers experience your brand. This automatically contributes to higher retention and revenue. To start thinking about strategies to get to the next stage of your growth, leave the nitty-gritty of billing activities to Zoho Billing Enterprise Edition. It delivers everything you need with remarkably low time-to-implementation and high uptime.

Still not sure if the product fits your needs?

Book a tailored demo with our experts and get a thorough understanding of the platform's ability to handle subscription billing.