Allright the 1 year mark is coming up and one of my concerns is how many of my customers will renew who are on a yearly plan or if there is (typically) a large percentage of people who won't renew for another year (OH I don't need that site anymore I haven't used it in months - for example).

So for those of you who have yearly plans and have had a year or two to see a trend, what are the trends like for you? Do most people renew for another year, or do you see a lot of cancellations for those yearly billings?

Most of our yearly customers do renew the contracts. We find the customers that do not renew are ones that are not using the site anymore.

Probably about 75% renew right away. You'll find that by doing annual invoicing, alot of people's email addresses will have changed since they originally signed up...and they neglected to tell you. :eek:

If they don't renew, we usually put up a "SITE NOT AVAILABLE" page on their account. Eventually, (we give them about a month) a few more will contact us to renew...when they notice their site is down. :stickout

Let me know if you have any questions about annual stuff. About 80% of our customers are on yearly billing.

--Tina

The majority of our clients have renewed their annual cycles.

What we did learn early on was the need to send multiple reminders...

a) 30 days prior to due date send a nice letter letting them know it's time...

b) 15 days prior to due date (or whatever your normal invoice cycle is) send the invoice

c) 5 days after due date (or whatever your normal "hey you're late cycle is) send the deactivation notice

d) Be prepared after the deactivation to receive the "clueless email" from the client asking why their account doesn't work and then submitting the payment ;)

Again, most will probably renew, the biggest issue is just ensuring they realize it is time to renew since they are not accustomed to having to pay for it ;)

We have found that clients changing contact email address and account not required anymore to be them main reasons for yearly accounts not renewing.

I would say about 75% of yearly customers renew going on our current figures.

I would say about 75% of yearly customers renew going on our current figures

Yes, I agree. There are some customers who want to shift to someother place do not renew.

We started out by offerring 360 day payment options, but moved over to 30 day billing only. IMO, it's best to have your revenue in sync with your monthly costs. It keeps your cashflow real and makes it easier to manage costs, which mostly are monthly etc...

I guess it would also depend on how many renew their account as to your relationship with them and the status of their credit card.

Originally posted by Aussie Bob
We started out by offerring 360 day payment options, but moved over to 30 day billing only. IMO, it's best to have your revenue in sync with your monthly costs. It keeps your cashflow real and makes it easier to manage costs, which mostly are monthly etc...

I guess it would also depend on how many renew their account as to your relationship with them and the status of their credit card.

Its good to have a firm mixture of both IMO.

Originally posted by mlovick
Its good to have a firm mixture of both IMO.
Why?

A mix does make sense because you just count on the monthly customers because you know that your getting in and the yearly renewers are just "butter" that can be put into savings or can pay for your trip to Europe :)

True. A mixture is good. It allows for some good forward planning. We're with probably 80-85% annual accounts, and billing is quick and effortless (when you're not scrambling to change card processors:)).

Regards

Gary

I would have liked to have quit doing yearly payments a long time ago, but once you start taking them, you really need to take them for a full year else your income graph looks like the stock market.

For example, in January I had around 10K in sales, but most of that was yearly sales, at that point monthly sales amounted to roughly 900 bucks, so had I stopped taking yearly payments, Feb's income would have been $900 + new signups (all monthly) and would have been a lot less than January since I wouldn't have had a buttload of $40 yearlies and other yearlies to boost that up to Jan's level, so I decided I'd rather take at least 1 year worth of yearly subscriptions so every month will have yearly renewals happening so that all the months kinda even out.

I also introduced reseller packages and only allowed monthly payments on those.

Now that I'm nearing the year mark, I'm considering removing the yearly payment option maybe doing a monthly and a quarterly option instead.