What is Dunning?
“Dunning” – Ding, ding, ding! No, it’s not the sound of a game show buzzer, but rather a term you’ll often hear bouncing around in the world of subscription businesses. If you’re a bit baffled by this word, buckle up! We’re about to take a fun, whirlwind tour into the land of Dunning.
In the simplest terms, Dunning is like that one friend who never lets you forget you owe them money. Only, in this case, it’s a process used by businesses to remind customers that their subscription payment is overdue. You could think of it as a sort of ‘friendly’ nudge or a “Hey pal, you forgot to fork over the cash!” kind of message.
Let’s paint a picture: imagine you’ve subscribed to a monthly service for, let’s say, unicorn grooming. You forget to pay because you’re too busy riding on rainbows. A Dunning process would be the system sending you reminders that you need to pay up for your unicorn’s spa day.
Now, a Dunning process isn’t just a one-and-done deal. Oh no, it’s more like a relentless, yet polite, stalker. It’ll keep reminding you about the payment, and could even escalate to more serious measures if you continue to ignore it. It’s like that annoying alarm clock that just won’t stop until you get out of bed.
But wait! Before you start picturing a Dunning process as the bad cop, remember this: it’s actually there to help. It’s a way for businesses to reduce involuntary churn – which is just a fancy way of saying “losing customers because they didn’t pay.” It also gives customers a chance to settle their bills before they lose access to the service. So, it’s kind of like your best mate reminding you to pay the bartender before you’re kicked out of the pub.
Like everything else in life, there are different flavors of Dunning. Hard Dunning is when the service is immediately suspended until payment is received. Soft Dunning, on the other hand, is a bit more lenient, allowing customers a grace period to make their payment. It’s like the difference between a strict gym teacher and a chill art instructor.
So, the next time you get a reminder about an overdue payment, don’t grumble. Instead, smile and say “Ah, that’s Dunning doing its thing!” Because, just like a best friend reminding you about your bar tab, it’s just trying to keep you from falling off the unicorn.
