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How a mobile-first car management platform increased ARR by 11%

Learn how this mobile first car management platform partnered with Butter to reduce involuntary churn.

15%

decrease in churn

11%

increase in ARR

35%

lift in invoice recovery

Overview

Treads is a mobile first car management platform that offers a tire subscription to thousands of customers across the US who value peace of mind and convenience when it comes to maintaining their vehicles. Despite a healthy user acquisition funnel, as the company scaled rapidly, Treads dealt with elevated rates of payment failure. The company began investigating projects focused on augmenting customer retention via payment collection optimization.

Quick Jump

The Challenge

Only 1 out of every 2 transactions were successful

The Treads leadership team approached Butter to help cut payment failure among paying subscribers. Butter identified that Treads’ overall payment authorization rate stood at 53%. Sixty percent of those users with a payment failure on a subscription collection attempt were never fully remediated - meaning they were losing access to a service they wanted to pay for, simply because of payment configuration issues. Butter took on the challenge of ending involuntary churn.

The Solution

Butter’s implemented a personalized, per-payment dunning schedule

Butter implemented a variety of targeted solutions to help Treads dramatically improve its payments business overall, with a particular emphasis on serving its diverse customer base. Butter implemented a personalized, per-payment Dunning scheduler into Treads’ payments back-end to improve the rate of failed payment collection from 40% to 55%. In doing so, Butter enhanced Treads’ ability to transact with top of funnel users by cleaning up the overall health of Treads’ Merchant ID via dynamic decline code handling. Finally, Butter devised a machine-learning-based approach to payment recovery that helped the company recoup more than 11% of top line ARR.

The Results

Butter’s payment recovery solution led to 35% increase in invoice recovery rate

Treads’ invoice recovery rate jumped by more than 35% as a result of Butter’s targeted solutions. This has resulted in a more than ten percent boost on Treads’ top line ARR—on account of changes in support of existing customers alone. Treads is now well equipped to amplify revenue streams while also welcoming a more diverse user base onto its tire subscription offering.

15%

decrease in churn

11%

increase in ARR

35%

lift in invoice recovery

Your customers deserve Butter