Best of the ISP-Lists

Sending Bills by E-mail

Members of the ISP-Tech list discuss cutting the cost of billing customers. For ISPs, billing by e-mail seems like an obvious solution, but there are pitfalls you should watch out for.

[December 11, 2000]

On the ISP-Tech list in November, CS queried,

"Do any of you do e-mail billing? What problems have you had? We currently send out over six thousand bills per month, which is quite expensive. We do have a discounted credit card rate, but less than a third of our customers use it."

A number of respondents shared horror stories about their e-mail billing experiences:

[JK recalled] "We tried e-mail billing, but we suddenly found ourselves with a 75% non-pay rate. It is easier for them to hit delete in their Inbox than to throw away the bill-and that's assuming they even check their e-mail."

[PJ added] "People seem to pay better when they get a bill in the mail. We do try to get as many as possible to switch to automatic bank draft, though; it doesn't cost as much as snail mail, and you get your money sooner."

[TN agreed] "When we used e-mail billing, we spent hours chasing customers on the phone, and no doubt spent more money doing that than it would have cost to do snail mail. We shared an office at the time with a local newspaper flyer company. They suggested including a small flyer with our invoices and selling advertising in it; now we make about $300 a month in profit by snail mailing our invoices along with a newsletter full of hints and tricks."

Others contended that it's never been a problem:

[JY offered] "We offer e-mail billing as our standard invoicing method. We did have a few objections, but our service reps estimate that no more than five people quit just because we made the change. For those customers that want to still receive a snail mail version, we charge an extra dollar a month. Surprisingly, a lot of our customers took that option for the mailed invoice; last month we sent roughly 1000 e-mail bills and over 2000 snail mail bills. At a dollar each, it's worth stuffing envelopes!"

[JP observed] "We've never sent out a paper invoice. We inform the customer when they join us that they will only get an invoice via e-mail, and that it is their responsibility to ensure that they get it and pay it. For those who demanded a paper copy, we simply directed them to their print button. It is definitely much easier having started this way, though; I would never want to implement this type of system mid-stream."

[JL noted] "We have no billing department. Instead, we accept payment only by credit card, and we charge our subscribers' cards once every four months, in advance. It's worth pointing out to your subscribers who claim to need paper invoices that their monthly credit card statement, which clearly shows your charges, is a legal receipt in every sense of the word."

—End