Automatic Billing Makes Sense For Businesses, Because It Increases Customer Retention. Here Are Some Stats That Support This Claim:
- An April 2007 survey by Harris Interactive and the Marketing Workshop found that consumers who pay bills electronically (including those using automatic payment) are 39% less likely to switch to a competitor.
- According to the Newspaper Association of America, newspapers that use EZ Pay, an automatic billing service, increase subscriber retention rates by over 50%.
- The Globe and Mail, Canada's largest newspaper, increased its subscriber retention rate from 45% to 69% by pushing automatic payments. Through various incentives, it persuaded 9 out of 10 new subscribers to use automatic payments.
- A coming trend -- In 2005 a survey conducted for the American Bankers Association found that 52% of consumers now use automatic payment from a credit or debit card to pay bills. Checks accounted for 45% of monthly billing payments in 2005, down from 57% in 2001, according to a MasterCard survey.
- Roughly 42% of auto insurance bills are now paid through automatic payment systems
- Time-pressured customers want the convenience of automatic billing. Consumers are 62% less likely to change their financial institution if their debit cards are linked to recurring payments.
- During the lifetime of a magazine subscription, automatic billing increase the profits associated with that subscription by 10% to 15% according to Mark Stanich, senior vice president of American Express Publishing.
