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Magento Tips on How to Manage Subscriptions and Recurring Payments

Today many businesses find it beneficial to offer subscriptions and recurring payment options to their online customers. Subscriptions and recurring payments from FastSpring make it easier for you to sell products that are purchased on a regular basis by customers e.g. magazines, software licenses, memberships and medication. They can also be used for selling services too.

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If you sell magazines or other products that are bought on a regular basis from your Magento store, why not offer customers the chance to buy a subscription?

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If you believe your business and it’s customers would benefit from recurring payments, see below for our tips on how to set them up and manage them in Magento.

How do subscriptions and recurring payments work?

When customers buy a subscription for a product or service, they are basically telling the business that they would like to receive the product or service on a regular basis. This may be every week, every few weeks, every month or every year. Instead of them having to pay for the entire subscription upfront (though this is often an option) many businesses allow their customers to set up recurring payments.

Recurring payments are essentially an agreement between the customer and the store. By setting up a recurring payment, the customer is authorising the merchant to charge their account again in the future, according to the terms of their subscription.

In order for recurring payments to work, the merchant needs to store the customer’s credit or debit card data on their system. All card data must be encrypted and businesses must be PCIDSS compliant.

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Improve your customers’ experiences with your company by allowing them to set up recurring payments for their subscriptions.

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Benefits of setting up subscriptions and recurring payments

Although shopping online is already quick and convenient for customers using a professional ecommerce website, allowing them to buy subscriptions can make the process of shopping online even easier for them.

One of the reasons why subscriptions and recurring payments are beneficial to customers is that it prevents them from having to remember to buy a particular product they need each week, month or however often they need it. This is particularly useful if they are ordering something like medication online, as it prevents them from running out.


Allowing customers to set up subscriptions and recurring payments will prevent them from forgetting to buy their must-have items.

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Allowing your customers to buy subscriptions and set up recurring payments will also save your customers a significant amount of time and effort. It will improve their overall experience with your company and should lead to higher levels of customer retention and loyalty.

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Offering customers subscriptions can also help to increase your revenue and profits.

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It is not just your customers that can benefit from subscriptions and recurring payments in Magento, you can too! Automating the billing process will save time, increase efficiency and help you to keep your costs to a minimum. You will also find that it improves your revenues, as more customers will be committing to giving you their business in the long-term. This can greatly benefit you when it comes to forecasting cash flow, as you will already have a good idea of the money you have coming in over the new few weeks and months.

How to set up recurring profiles in Magento

One of the great things about Magento is that it offers native functionality for subscriptions and recurring payments ‘out of the box.’ The only catch is that payments have to be made using a PayPal account. If you want customers to be able to pay using other payment methods, you may want to consider integrating your ecommerce store with a Magento extension, which we will go on to discuss later.


Magento allows recurring payments to be processed via PayPal only.

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In order to allow your customers to buy subscriptions from your Magento store, you will need to set up recurring profiles. A recurring profile is basically an accounting record that details the payment schedule. It includes information such as the start date of a subscription, how often payments are to be taken and the end date of the subscription.

In Magento, merchants can set up recurring profiles for both ‘simple’ and ‘virtual’ product types. The customer can then add a product with a recurring profile to their shopping cart. After selecting PayPal as their payment method, they will be taken to the PayPal website where the system will set up and define a payment schedule. The customer will then be taken back to your Magento website to complete their order and will be given a recurring profile ID.

Setting up recurring profiles for Magento products

In order to set up recurring profiles for products you will need to first go to the Magento Admin Panel. From there choose Catalog > Manage Products and select the product you would like to create a recurring profile for from the list. On the Edit Product page, you will see a tab that says ‘Recurring Profile’ on the left. Click on it and set the ‘Enable Recurring Profile’ field to Yes. From there you will be able to define the payment schedule.

Configuring the Schedule panel

In the Schedule panel you will be able to configure your recurring profiles. The first thing you can do is set whether the customer is allowed to choose the start date of the recurring payment. If you do not allow this, the start date will always be the current date (day of purchase).

You will also be able to create a schedule description. This is a short description that will be displayed on the ‘review information’ page of the payment system.

Merchants can set the maximum payment failures within the Schedule panel. If the number of failed scheduled payments exceeds the value you input, the recurring profile will be automatically suspended.

Configuring the Billing panel

Once you have completed the fields in the Schedule panel, you can move onto the Billing panel. There you will be able to specify the Billing Period Unit. This will either be daily, weekly, biweekly, monthly or yearly depending on your preferences. You will then need to set the Billing Frequency, which specifies how often within the billing period unit will the payment system take a payment from the customer.

You will also be able to set up maximum billing cycles. This will limit the number of payments allowed in a single billing cycle. If you do not specify a number, the customer will continue to be charged by the payment system until they suspend or cancel their subscription.

Configuring the Trial Period panel

In this panel you can choose to allow your customers to trial a product. This means customers will pay a discounted rate for the duration of the trial, but once it is up they will be charged a regular subscription amount In this panel you will be able to set the trial billing period unit, trial billing period frequency, trial billing period cycles and trial billing period amount.

Configuring the Initial Fees panel

In this panel you can set up an initial fee that your customers will have to pay as soon as they buy a subscription. This fee will only be paid once during the lifetime of the subscription. You can also choose to suspend profiles if the initial fee payment fails by configuring the ‘allow initial fee failure’ option.

Make sure to save all of the changes you make and your recurring profiles in Magento will be ready to use. From there on, you will be able to manage the recurring payments by going to Sales > Recurring Profiles where you will be able to view, update, suspend and cancel recurring profiles.

Tips for using subscriptions and recurring payments

In order to get the most benefits out of using subscription and recurring payments, you first will need to encourage consumers to use them. The best way to do this is to ensure they understand the value and benefits of setting up recurring payments. Refer back to our ‘benefits’ section for examples. You may also want to consider offering them incentives to sign up to a subscription, such as a discount, free gift or loyalty points.

Make it easy for customers

Making the sign up process easy will also encourage more customers to buy your subscriptions and setup recurring payments. Remove any unnecessary steps in the process, whilst still ensuring that you gather all of the relevant customer payment data you need upfront.

Offer a range of payment methods

It is also important to ensure that you offer payment methods and currencies to suit your customer base and business model. Magento only allows payments to be made via PayPal, however you can offer additional payment methods, by integrating your web store with various Magento extensions.


If you’re going to set up recurring payments, you need to ensure your payment system is completely secure.

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Ensure data is secure

If you are going to offer subscriptions and recurring payments, it is absolutely crucial that you keep your Magento ecommerce store secure. All payment data taken by your payment system must be encrypted to prevent theft and fraud. Furthermore, it is essential that you are PCI compliant. Display certifications and badges on your Magento store to give customers’ confidence in buying your subscriptions.

Allow customers to choose their billing date

Allowing your customers to choose their billing date (something you can set up in the Schedule panel of Magento) will be very beneficial as it will help to ensure that they have funds available when they need to pay for their subscription.

Inform your customers of how the transaction will appear on their statements

Prevent problems during the payment process by informing your customers of how the transactions will appear on their card statements. This will avoid any confusion on their part.

Provide details of billing arrangements

It is important to provide your customers with a copy of the billing arrangements. Make sure you clearly disclose all charges and the date in which funds will be taken from their account.

Create a cancellation policy

Make sure you create a clear and easy to understand cancellation policy for your subscription products. Your policy must be fair and easy for customers to find.

Send pre-billing notifications

Sending pre-billing notifications can also help to prevent problems during the payment process. Informing customers that you will soon be taking the payment from them will allow them to make sure they have money in their accounts.

Magento extensions for managing subscriptions and recurring payments

One of the easiest ways to manage subscriptions and recurring payments in Magento is by integrating your online store with a specially designed extension. There are a number of different Magento extensions available for managing subscriptions and recurring payments. See our recommendations below for help finding the best module to meet your needs and requirements.

Subscriptions and Recurring Payments by aheadWorks – $299

This module makes it easy for you to sell subscription products and services on a daily, weekly, monthly or yearly subscription basis. It has very flexible settings, allowing you to change things like the prices of subscription intervals in order to entice customers to subscribe for longer and benefit from a discount.

The extension also allows merchants to create groups for their subscribers, making it easier to manage their subscriptions and send them targeted communication. When a customer subscribes, they will pay for their subscription once and then all future payments will be created automatically according to the recurring profile settings you create. The module supports both PayPal and Authorize.Net, allowing you to schedule orders in advance.

Authorize.Net CIM with Recurring Profiles – $599

Another recurring payments extension for Magento that has received five star reviews it the Autorize.Net CIM with Recurring Profiles extension. This extension allows you to store customer payment information on Authorize.Net’s secure servers. It supports all standard payment actions in Magento and allows customers to save their details for future use, with full PCI compliance.

This particularly extension fully supports Magento’s Recurring Profiles feature, which we provided a guide to above. The great thing about using this extension with Magento’s recurring profiles feature is that you will not have to rely on PayPal. You can ensure billing is performed to your set schedules and can benefit from a more efficient and reliable system.

There are plenty of other subscription and recurring payment extensions for Magento available from the Magento Connect store. However if you are unable to find an extension to meet your needs and requirements, you can always get in touch with the development team here at Online Media Direct.

Image credits: LDT Team, danielfoster437, colindunn, lumaxart, ebayink and  perspec_photo88

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