What is Dunning Management?
Definition
The systematic process of communicating with subscribers about failed payments and recovering revenue through automated retry strategies.
Understanding Dunning Management
Dunning management goes beyond simple payment retries. Sophisticated dunning systems include: intelligent retry timing (retrying at optimal times when cards are more likely to succeed), fallback payment methods (trying alternative cards), subscriber communication sequences (escalating urgency in emails), and in-app notifications. Advanced dunning can recover 50-70% of failed payments.
Services like Stripe, Recurly, and Baremetrics offer specialized dunning tools. For subscribers, responding to dunning emails promptly prevents service interruption. Having a backup payment method on file significantly reduces the risk of losing access due to a failed primary card.
Related Terms
Dunning
The automated process of retrying failed subscription payments and communicating with subscribers about payment issues to recover revenue.
Involuntary Churn
Subscriber loss that occurs due to payment failures rather than the customer's deliberate choice to cancel.
Payment Method
The financial instrument used to pay for a subscription, such as a credit card, debit card, PayPal, or bank account.
Grace Period
A short window of time after a payment fails or a subscription expires during which the service remains accessible before being suspended.