Blog / InspirationTuesday, July 21, 2020

Proration

Jakob Soderberg

Proration

Proration, is the term that covers: When someone signs up for your service, up-/downgrades on a “crooked” day of the cycle.

 

Imagine the following:

 

You have a good subscription business. Everyone is happy.

New customers are constantly appearing on your platform. Most start with a "basic" subscription and when customers realize how much value they get from being members / subscribers to your club, they upgrade their subscription.

 

Hurray. 

 

What happens when your customers upgrade their service in the middle of the billing period?

 

In the vast majority of cases, customers drive "cheap" on the new and more expensive subscription until a new settlement period arises. Simply because it is "a bit hassle" to figure out how much more you have to pay in the remaining period.

 

 

 

Yes.. calculating the right price is relatively complex - but a platform built solely for handling different types of subscription stores is just the ingredient that gives you superhero powers and ensures you don't lose valuable revenue.

 

With software that automatically ensures that customers pay exactly what they need (no more, no less) you get the opportunity to focus on your core business and create even more value for your customers. Then you can safely hand over proration to someone like us.

Is this something you would like to know more about - let's talk.

 

Author: Jakob Soderberg

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