In February, couples around the world plan for how to celebrate Valentine’s Day. While flowers and chocolate are time-tested testaments of affection, gift cards have become a popular choice in our more modern, e-commerce-driven times.

The New Year is a time to reflect on the year that has passed and plan for what lies ahead. At Recurly, it’s become our tradition to look back on our blog posts from the previous year and see which were the most popular. We’re always pleased to see how many clicks and shares our posts receive, and hope that our blog helps customers better use Recurly to manage and optimize their subscription business.

As we have discussed in the first and second blog in this series, dunning is a key process for maximizing revenue, and Recurly offers flexible tools to help you develop and manage your dunning strategy. In particular, Recurly users can set:

In today’s blog, we’re continuing our discussion about dunning. As a reminder, dunning is the process of communicating with customers (usually by email) to try to collect payments due. In effect, discussions about dunning are really discussions about these customer communications.

In our last blog, we described how the dunning process works at each step and the decisions the merchant can make which can optimize the process and improve results. We also outlined how Recurly’s dunning process is more effective.

In our previous post in this series, we discussed the importance of reducing the friction that occurs during the subscriber lifecycle in order to promote and support continued revenue growth. We focused on free trials as a way to reduce sign-up friction in that post.  

But friction at sign-up is only one touch-point in the subscriber lifecycle. In order to extend the lifetime of your subscribers, you must look for and reduce points of friction throughout their entire lifecycle, from engagement through retention.

In light of Netflix’s recently announced pricing changes last month, this seems a good opportunity to talk about price increases as a point of friction.

One of the main challenges subscription businesses face is churn, which lowers the number of subscribers  and monthly recurring revenue. The two types of churn are voluntary and involuntary, and because each is driven by entirely different things, as a subscription business, you need to take different steps to mitigate each type of churn.

Businesses are always looking for ways to make it easier for customers to interact and make purchases. Starbucks launched a mobile ordering system nationwide in 2015, letting customers avoid the long lines at the store by using the Starbucks app to place their order which is then waiting for them when they come into the store. Tesco, a UK grocery store chain, recently debuted their “Scan As You Shop” system where customers use a handset to scan their own items and then put them directly into their bags in their shopping cart.

Last December, a pub in central London did something unique to help improve its customers’ experience. Bars and pubs in London can be crowded, especially during the holidays. They’re so crowded, in fact, that customers wait an average of 12 minutes per drink order at the bar. Depending on how many trips a patron takes, this can take a big bite out of their time for merriment and socializing with friends. Indeed, this lengthy wait time was a huge annoyance and the pub knew it.

What do you think caused 5.5 million people in Britain to cancel their credit cards last year? If you guessed fraud, you’d be right. Those 5.5 million people comprise a full 12% of the population—one million higher than last year and evidence that cybercrime has gotten worse in that country and people are taking action to protect themselves.

At the highest level, three major hallmarks of a strong subscription model are:

• predictable revenue
• customer loyalty, and
• the ability to harness a wealth of data for valuable subscriber insights

Predictable revenue and customer loyalty are key because, unlike traditional transactional billing models, subscription businesses frequently incur greater expense upfront to acquire subscribers. The payback on that acquisition cost happens over the subscriber’s lifetime.