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Important:
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Subscription switches can affect:
- Entitlement
- Billing cycle
- Refund behavior
And may result in time proration.
Subscription switch algorithms provide different sets of settings affecting these four aspects. In this article, you will learn how to change the upgrade and downgrade algorithms for your offers and what algorithms are available in Cleeng.
Default settings
Cleeng applies the following subscription switch algorithms by default:
- For upgrades: immediate without proration
- For downgrades: deferred
How to change subscription switch algorithms?
To adjust the switch algorithms and free trial behavior, log in to your ChurnIQ account > go to the Admin & Tools section (in the main navigation, on the left-hand side) > choose Offer switch settings.
You can choose a different algorithm for subscription upgrades and downgrades. The algorithms of your choice will be applied to all subscription upgrades or downgrades of all your offers.
Supported subscription switch algorithms
Below you can find a brief overview of all available options (see the table below) followed by a more detailed description of all the algorithms.
| Switch algorithm | Entitlement switch | Billing date | Refund |
| Deferred | Deferred | Unchanged | None |
| Immediate and charge without proration | Instant | Changed | None |
| Immediate and charge with full refund | Instant | Changed | Full |
| Immediate and charge with refund | Instant | Changed | Partial |
| Immediate and charge with time proration | Instant | Changed | None |
| Immediate without proration | Instant | Unchanged | None |
| Immediate with time proration | Instant | Changed | None |
Deferred
- Subscription switch: Deferred. The subscription is switched when the subscription renews (according to the existing billing cycle).
- Entitlement: The user keeps access to the current plan until the next billing date. They get access to the new plan at the regular recurring date.
- Payment: The user is charged full price for the new plan at the regular recurring date (according to the existing billing cycle).
- Billing: The billing cycle remains unchanged.
- This is the default and recommended algorithm for downgrades.
Immediate and charge without proration
- Subscription switch: The subscription is switched immediately.
- Entitlement: The user gets access to a new plan immediately.
- Payment: The user is charged full price for the new plan immediately. The remaining value from the previous subscription is not prorated.
- Billing: The billing cycle is changed and starts at the moment of the subscription switch.
- Important: This algorithm is used by Cleeng for switching from a free trial when the free trial is not going to be continued on a new subscription.
Immediate and charge with full refund
- Subscription switch: The subscription is switched immediately.
- Entitlement: The user gets access to a new plan immediately.
- Payment: The user is charged full price for the new plan immediately. They are fully refunded for the previous subscription.
- Billing: The billing cycle is changed and starts at the moment of the subscription switch.
Immediate and charge with refund
- Subscription switch: The subscription is switched immediately.
- Entitlement: The user gets access to a new plan immediately.
- Payment: The user is charged full price for the new plan immediately. They receive a refund of the remaining value from the previous subscription. (See below for more information on partial refunds.)
- Billing: The billing cycle is changed and starts at the moment of the subscription switch.
Immediate and charge with time proration
- Subscription switch: The subscription is switched immediately.
- Entitlement: The user gets access to a new plan immediately.
- Payment: The user is charged full price for the new plan immediately.
- Billing cycle: The billing cycle is changed twice:
- First: The new billing cycle starts at the moment of the subscription switch and it’s prolonged (the remaining value from the previous subscription is adjusted for a prorated time period and credited to the user).
- Second: The new, final billing cycle starts after both, the first billing cycle and the credited period finish.
- This algorithm is not recommended for downgrades.
Immediate without proration
- Subscription switch: The subscription is switched immediately.
- Entitlement: The user gets access to a new plan immediately.
- Payment: The user is charged full price for the new plan at the regular recurring date (according to the existing billing cycle).
- Billing cycle: The billing cycle remains unchanged.
- This is the default algorithm for upgrades.
Immediate with time proration
- Subscription switch: The subscription is switched immediately.
- Entitlement: The user gets access to a new plan immediately.
- Payment: Any time remaining is adjusted based on the price difference (the remaining value from the previous subscription is adjusted for a prorated time period and credited toward the new subscription by pushing forward the next billing date). The user is charged full price for the new plan once the credited time is over.
- Billing cycle: The billing cycle is changed – the billing date is pushed forward in the case of an upgrade or prolonged in the case of a downgrade.
- This algorithm is not recommended for downgrades.
Free trial behavior
Switch from a subscription with a free trial
An active trial period on the subscription from which an upgrade or downgrade is happening affects the switch behavior.
- If a switch is requested to an offer with a trial and the user is eligible for it (for both upgrade and downgrade directions), the switch happens immediately, and by default, the trial is continued, however, its duration is recalculated (see below on the recalculation formula). The calculation is made based on the time duration of free trials (number of days), not the money equivalent of the offer. Once the recalculated trial is finished, the user is charged the full price of the switched subscription.
Example: A user has started the BRONZE monthly offer with two weeks trial period. In the middle of the trial (50% of the trial duration), the user has decided to switch to the GOLDEN offer, which has one week trial period defined. After the switch, the trial shall be continued. As the user has used half of the BRONZE trial (50%), they still can enjoy (50%) of the GOLDEN offer trial which in this case is equal to 4 days (7 days * 50 % = 3.5 days = rounded to 4 days).
- If a switch is requested to an offer without trial (for both upgrade and downgrade directions), the user loses the trial, the switch happens immediately, and the user is fully charged for a new plan.
You can change the free trial behavior in the dashboard and override the default free trial continuation behavior and instead stop any free trial along with the subscriptions switch.
Switch from a subscription without a free trial
If a switch is requested to an offer with a trial, the trial is not started and the switch follows the behavior of the algorithm used in this switch.
Partial refunds
- A subscription switch under the Immediate and charge with refund algorithm results in a partial refund.
- In the case of a partial refund, the user receives a refund of the remaining value from the previous subscription. The refund is calculated from the gross amount (incl. sales tax), therefore the partial refund also includes the prorated amount of the tax paid previously.
- Partial refunds are not supported by all Cleeng’s payment gateway integrations.
Adyen and PayPal integrations support partial refunds.
Bambora, Altapay, and other payment gateway integrations do not support partial refunds.
When a subscription switch is happening with the use of an algorithm that prorates based on partial refund and customer active payment details are for the payment gateway that does not support it, the platform default algorithm (supported by all payment gateway integrations) will be used as a fallback for the switch.
- If you process a partial refund, it is not possible to process a refund of the remaining value.
- Partial refunds are available in Cleeng only in the case of subscription upgrades and downgrades. (Customer support agents cannot trigger partial refunds.)
Important
- Subscription switches often result in proration.
Proration is the process of calculating the remaining value of the service left after a subscription switch. Proration results in the adjustment to:
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- The bill amount – a partial refund of the remaining value is processed. It applies to Immediate and charge with refund algorithm.
OR
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- The billing period – any time remaining is adjusted based on the price difference between offers, and credited toward the new subscription as additional days (pushing forward the next billing date). It applies to Immediate and charge with time proration algorithm and is not recommended for downgrades, as it may cause business logic vulnerabilities.
Proration behavior is described in the relevant algorithms above.
Note that in the case of native apps (Android, Apple, and Roku), subscription switches and subscription switch algorithms are configured and controlled by native apps’ ecosystems. Cleeng listens to the notifications and mirrors the changes in the system. Read more about subscription upgrades and downgrades in In-Apps.
- It is not possible to perform a subscription switch from an offer that has an active coupon applied (the switch API call will return an error).