4 ms·
Yearly contracts paid monthly give a great income predictability already which mitigates risk. Also customer retention / CLV might be better, because users pay
by nielsole 6y ago
Yearly contracts paid monthly give a great income predictability already which mitigates risk. Also customer retention / CLV might be better, because users pay until the end of the 12 months despite stopping using the product earlier.
- kelnos 6y agoThere's more risk there, though, no? A customer could cancel before the end of the year and simply stop making the remainder of the payments. Sure, there's recourse, both through the credit card companies and courts, but that takes time and effort and possibly lawyers (aka money). If you require annual customers to pay the entire year up front, you get the money, and that's that, barring credit card chargebacks.
- x0x0 6y agoand they're a pita for business users -- they have to deal with either reimbursing or at least tagging 12x the charges on their personal or business card.