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SaaS Subscription Billing, or How to avoid getting your n*ts in a vice

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Re: SaaS Subscription Billing, or How to avoid getting your n*ts in a vice

#31

Post by MicahWedemeyer »

brass_cannon wrote: post #28
drm237 wrote: post #21

Earlier quoted context omitted.

Authorize.net also has a vault product. Chargify still stores the CC at the gateway level, so you have gateway lockin I don't understand this. Gateways that provide a vault for storing credit card information give you a way to get it out in order to process the transaction. So if you can get the information out, couldn't you just transition to a new gateway if necessary. Only sites like Paypal and Amazon really have…

The way most vaulting services work is, you pass through credit card details, and they store in their vault. They then send you back a token to reference for future transactions. In most cases, you won't have the ability to pull back the full vault entry (specifically the credit card number) from them. This is the lock in that's being referred to here. Most gateways who won't let you export the cc data yourselves, or…

Bingo.

We decided to go with Authorize.net, and I'm afraid we're locked in again. I willingly and knowingly put my nuts in the vice this time. I asked the sales rep about getting the CC info back, and she cited PCI compliance as their reason for not giving it up.

Still, I decided to go with the big dog, and my hope is that any services like Chargify that we decided to use will also work with Authorize.

Re: SaaS Subscription Billing, or How to avoid getting your n*ts in a vice

#32

Post by MicahWedemeyer »

StavrosK wrote: post #19

To me, the most important drawback is the inability to defer charging. It honestly breaks my heart to want to tell someone "thank you for that, have a free month of service" and then to see that you can't do that because they already liked your service enough to support you. I see a commenter mentioning PayPal reference transactions, I will give those a go and see if they are more flexible.

I agree, free subscription time is my favorite thing to give. I can sort of do it with Chargify. It basically works as a partial credit toward their next charge. It's not exactly the same as deferring a payment, but it pretty much works out the same.

Re: SaaS Subscription Billing, or How to avoid getting your n*ts in a vice

#33

Post by MicahWedemeyer »

jasonemerick wrote: post #6

With Amazon's SimplePay subscriptions, you can offer a free trial or a promotional period at the start of the subscription contrary to the what the author of the post says. https://payments.amazon.com/sdui/sdui/business/asp/subscript...

I'm speaking of deferring payments, not free-trial periods. The SimplePay free trials work fine. It's only after they convert to paying that things are fully locked in.

Re: SaaS Subscription Billing, or How to avoid getting your n*ts in a vice

#34

Post by MicahWedemeyer »

jv22222 wrote: post #12

You can do exactly what you need with paypals reference transactions. Also if you use their NVP api, and web payments pro then the user does not need to leave your site and you can take c/c details on your site and pass directly to paypal. i.e You don't need to store their CC details you only need the reference transaction ID and you can re bill any amount you want. You also don't have to worry about PCI compliance.…

Chargify gives you a hosted payment page that you can brand with your own CSS so you never touch the CC at all. It works waaaay better than Amazon, and is not nearly as jarring.

If you don't like that, you can build your own page and pass off the CC details via the API, but I went with quick-and-easy Chargify hosted pages and have been very, very pleased.

Re: SaaS Subscription Billing, or How to avoid getting your n*ts in a vice

#35

Post by lsc »

MikeMacMan wrote: post #29
lsc wrote: post #22

Earlier quoted context omitted.

>I would assume they feel the same way anyone who has ever had phone, cable, or internet service feels. If I treated my customers as poorly as comcast does, I'd be out of business, and I say up front that you should only be my customer if you can tolerate poor service.

The point is that everyone is used to this pattern: free trial that will switch to paid subscription unless you cancel.

'everyone? Personally I associate those billing patterns with, uh, less than reputable businesses. Now, I may be very unusual, but we have at least one counterexample.

Edit: I sound like I'm calling you a fraudster, and that is not my intent. I really want to hear about the other side of this, in part because some of my customers have asked me to setup recurring billing that doesn't require action on their part.

As it is, most people who cancel do so right after I bill them. if I was just taking the money rather than sending the bill, then for the same thing to happen, they'd have to ask for a refund. Which, I seems kinda bad to me- I mean, negotiation is waste. However I could automatically gave a refund if they cancelled within X days of me charging them, that would solve the problem.

Anyhow, I really would like to know more about what you think of how 'normal' people think of it. It's not obvious to me.

Re: SaaS Subscription Billing, or How to avoid getting your n*ts in a vice

#36

Post by StavrosK »

MicahWedemeyer wrote: post #32
StavrosK wrote: post #19

To me, the most important drawback is the inability to defer charging. It honestly breaks my heart to want to tell someone "thank you for that, have a free month of service" and then to see that you can't do that because they already liked your service enough to support you. I see a commenter mentioning PayPal reference transactions, I will give those a go and see if they are more flexible.

I agree, free subscription time is my favorite thing to give. I can sort of do it with Chargify. It basically works as a partial credit toward their next charge. It's not exactly the same as deferring a payment, but it pretty much works out the same.

Too bad I'm stuck with PayPal :/

Re: SaaS Subscription Billing, or How to avoid getting your n*ts in a vice

#37

Post by lsc »

MicahWedemeyer wrote: post #30
lsc wrote: post #18

hm. how do customers feel about you changing the pricing without their input? I mean, it sounds like the guy is clear ahead of time, but if he thinks he will lose customers if he reminds the user that they are paying, uh, doesn't that mean that he is basically acknowledging that he is not providing a service the user values at full price? that he is just hoping they forget to cancel? It's related to something I've st…

doesn't that mean that he is basically acknowledging that he is not providing a service the user values at full price? Well, the users seem to like the service, and they're willing to pay full price. That's good enough for me. long term, you are better off providing enough value that the customer is willing to take active action to stay. Good luck with that. I take the stance of provide something of value AND make it…

right, but my worry would be that if you increase your revenue a lot when you switch from sending a bill and waiting for them to give you money to taking money automatically until they ask you to stop, I would question how much of that increase was due to people forgetting to tell you to stop until after they've been billed.

As I said elsewhere, I think the problem could be solved, for a pre-paid service, by giving an automatic refund if the user cancels within X days of getting billed.

Re: SaaS Subscription Billing, or How to avoid getting your n*ts in a vice

#38

Post by texel »

MicahWedemeyer wrote: post #27
texel wrote: post #17

It's interesting that the author didn't mention a third option– you can build your own subscription management and dunning code, and then foist the high-risk credit card related stuff onto a third party. I'm not sure I'd necessarily suggest doing this over going with a provider like Chargify or Spreedly (both look like cool services), but that's what we've done at Onehub, and while it was painful, it's worked extreme…

I did mention that option, and basically said it was a bad idea. I think that most SaaS apps are better served by offloading as much as possible onto third parties. Just like I wouldn't encourage someone to write their own web server, I wouldn't encourage them to write a subscription billing service. It's a pain. Pay someone else to handle that and focus on your core competency, whatever that is.

Right, having written a billing system, I'd agree with you wholeheartedly. I just got the impression that the article conflated rolling your own billing system with actual handing of the payments and credit card storage. Perhaps I was mistaken.

Re: SaaS Subscription Billing, or How to avoid getting your n*ts in a vice

#39

Post by dh »

dennisgorelik wrote: post #7

How does Chargify deal with fraudulent orders?

Since you have to have your own merchant account, we (Chargify) do not have to deal with the fraud transactions but give you the tools you need like searching for the account to turn it off.

Re: SaaS Subscription Billing, or How to avoid getting your n*ts in a vice

#40

Post by dh »

brianbreslin wrote: post #2

Chargify seems to be on the right path. I do think they could use some work on their flexibility though. Holding credit card data is always a bitch. Paypal website payments pro's API lets you issue coupons and discounts that are baked into the initial signup. However midcycle its tough to issue a discount. They also have some bugs in their API with their callback urls etc.

Glad you think Chargify is the right path, love to hear what flexibility you want that we cannot give.
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