Build stable revenue streams for your business with subscriptions

Jul 01 2022 | PayPal Editorial Staff

From customer retention to unlocking new revenue streams, find out more about subscriptions and how you can leverage it for your business.

Subscription business models place a higher weightage on customer retention as opposed to customer acquisition. Instead of paying a one-time upfront payment, customers pay on a recurring basis to enjoy products or services for a prolonged period of time.

Besides costing your business less to retain customers, subscriptions also help to sustain growth for your business in the long run by ensuring a consistent revenue stream. Here are some additional benefits your business can garner through subscriptions:

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  • Better inventory management
    Typically, subscription payments are made by customers prior to delivery of products or services which means you have a clearer view of stock levels required to meet customers’ expectations.
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  • Higher potential revenue
    Subscription plans lower the barrier to entry for your products or services by making them more affordable per payment cycle, which means potential customers are more likely to purchase.
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  • Easier cross-sell and upsell
    Subscription plans allow you to build trust with your customers over time. With trust, your customers would be more receptive to upgrades. For example, transitioning from a basic plan to a premium plan with additional features.

A variety of different businesses have started to offer subscription plans to their customers. From streaming services and online gaming to fitness and curated reads—customers can now make the best out of their experiences without the hassle of revisiting another purchase journey.

What are PayPal Subscriptions?

If you’re looking to create stable and predictable revenue streams for your business while maintaining the relationship with your customers, setting up subscriptions with PayPal can help get you closer to your scheduled targets. Besides that, being able to manage your subscriptions all in one place is as hassle-free for you as it is for your customers.

Activate subscription plans with PayPal to enjoy these features

  • Flexible subscription plans
    Fixed offer or quantity pricing (based on quantity being sold), and billing cycles that best fit your business.
  • Customizable trial periods
    Further incentivize and motivate your customers with discounted trial periods.
  • Simple, powerful management
    Subscription tools and APIs designed specifically to manage your subscription plans.
  • Business insights and KPIs
    Get real-time reports and status updates from your subscriptions overview page.

How do I activate subscriptions?

Before you get started, it’s essential to complete the steps here to get your sandbox account information from the Developer Dashboard. When you have access to your sandbox account information, follow this step-by-step guide to activate subscriptions for your business with PayPal:

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Once you have the above in place, your customers will then be able to opt for subscriptions. Whenever a customer successfully signs up for your plan, the PayPal button calls the PayPal subscriptions API to create the subscription.

Get Started

What are the fees associated with it?

PayPal does not charge any monthly fees, setup costs or lock-in contracts for your subscription plans—you only pay when you get paid. For international payments, you'll pay a fixed percentage plus a small fee per transaction. Learn more about fees here.

Manage your subscriptions all in one place

Set it up and more from your PayPal business account. From creating to managing your subscription plans, you have it all at the palm of your hands.

For additional support on activating and managing your subscription plans, you can find more helpful information here.

The contents of this site are provided for informational purposes only. The information in this article does not constitute legal, financial, IT, business or investment advice of any kind and is not a substitute for any professional advice. You should always obtain independent, professional accounting, financial, IT and legal advice before making any business decision.