Prepaid subscriptions

Overview

• What is it?
• Why should I use it?
• How do I set it up?
• Skipping prepaid orders
• FAQs

What is it?

• Prepaid subscriptions give subscribers the option to pay for all of their shipments upfront
• Example: If a subscriber buys a 3-month subscription, they’ll pay for the full 3 months on the 1st order and then the second and third orders will ship for $0
• This is a great way to improve retention and lock in revenue for loyal subscribers

Prepaid subscriptions are unique from the default subscription type and give you more flexibility and control to customize your subscription offerings. Unlike a typical subscription where a customer pays for individual orders one at a time, prepaid subscriptions allow your customers to pay for all of their shipments upfront.

Here’s a good visualization on how renewals work:

Why should I use it?

Prepaid shipments are a great way to incentivize customers to pay upfront for subscription orders they already intend to buy. This results in a commitment to the subscription interval and guarantees a better retention rate while locking in additional revenue on their first purchase.

If you’re wanting to get more creative, you can use our prepaid subscription feature as a way to facilitate a membership-style subscription program. Since subscribers would pay upfront, you could allow them to swap the product on prepaid shipments to other flavors or variants as their needs and tastes change.

Another way in which this would benefit merchants is that for some of our merchants that offer daily consumable products (eg. supplements), there's typically a retention issue because the customer doesn’t “feel the effects” soon enough and so they cancel. With a prepaid subscription, you can set the expectation that it takes a 3 month commitment to get full results and after the first month the customer can easily swap the flavor or edit the next shipment date to better match their consumption with their order frequency.

How do I set it up?

1. In the Skio Dashboard, go to Features
2. Click Selling Plans
3. Click Create New Plan in the top right corner
4. Choose Create Prepaid from the dropdown menu

As an example, let’s say you want to offer the option for your customers to pay upfront and bill the customer every 3 months, but have the product delivered every month. You'd follow the structure pictured above.

Click Save once you’re happy with the settings for your prepaid selling plan. Previewing the product, you’ll see that the Prepaid option is now available on the listing.

During the checkout phase, you'll also see that it notifies customers that they will be billed for the duration of their prepaid subscription:

When a prepaid order is placed from a customer, it will show the upcoming prepaid orders for the subscription within the Skio dashboard, as well as indicate the next charge date:

On Shopify's order page, it will also indicate that it's a prepaid when viewing the information on the customer's subscription.

Skipping prepaid orders

If a customer wants to skip their upcoming order, they can do so by clicking on the Skip button within their dashboard. It’ll prompt a message indicating to confirm the delay of the next delivery date:

   

When this happens, the page will be updated to reflect the next upcoming order and an updated list of dates for the schedule. In this example, the next charge date for the prepaid subscription will be on May 5. The upcoming orders in the renewal period have now shifted to reflect the change:

FAQs

• Yes! Subscribers can add one-time add-ons to their prepaid subscription and they will be charged when the order processes via the card on file.
• Important note: If the payment method fails because of the add-on being billed, the prepaid subscription can cancel if the dunning limit is reached and the prepaid $0 shipments will not be sent.

Can the subscription continue for the customer after the prepaid period?

• Yes! If you'd like for the prepaid subscription to end completely after the initial number of shipments is met, you can set the number of max intervals to equal the number of intervals in the prepaid period.