subscription-integration

Dodo Payments Subscription Integration

Reference: docs.dodopayments.com/developer-resources/subscription-integration-guide

Implement recurring billing with trials, plan changes, and usage-based pricing.

Quick Start

1. Create Subscription Product

In the dashboard (Products → Create Product):

• Select "Subscription" type

• Set billing interval (monthly, yearly, etc.)

• Configure pricing

2. Create Checkout Session

import DodoPayments from 'dodopayments';

const client = new DodoPayments({
  bearerToken: process.env.DODO_PAYMENTS_API_KEY,
});

const session = await client.checkoutSessions.create({
  product_cart: [
    { product_id: 'prod_monthly_plan', quantity: 1 }
  ],
  subscription_data: {
    trial_period_days: 14, // Optional trial
  },
  customer: {
    email: 'subscriber@example.com',
    name: 'Jane Doe',
  },
  return_url: 'https://yoursite.com/success',
});

// Redirect to session.checkout_url

3. Handle Webhook Events

// subscription.active - Grant access
// subscription.cancelled - Schedule access revocation
// subscription.renewed - Log renewal
// payment.succeeded - Track payments

Subscription Lifecycle

┌─────────────┐     ┌─────────┐     ┌────────┐
│   Created   │ ──▶ │  Trial  │ ──▶ │ Active │
└─────────────┘     └─────────┘     └────────┘
                                         │
                    ┌────────────────────┼────────────────────┐
                    ▼                    ▼                    ▼
              ┌──────────┐        ┌───────────┐        ┌───────────┐
              │ On Hold  │        │ Cancelled │        │  Renewed  │
              └──────────┘        └───────────┘        └───────────┘
                    │                    │
                    ▼                    ▼
              ┌──────────┐        ┌───────────┐
              │  Failed  │        │  Expired  │
              └──────────┘        └───────────┘

Webhook Events

Event When Action

subscription.active Subscription starts Grant access

subscription.updated Any field changes Sync state

subscription.on_hold Payment fails Notify user, retry

subscription.renewed Successful renewal Log, send receipt

subscription.plan_changed Upgrade/downgrade Update entitlements

subscription.cancelled User cancels Schedule end of access

subscription.failed Mandate creation fails Notify, retry options

subscription.expired Term ends Revoke access

Implementation Examples

Full Subscription Handler

// app/api/webhooks/subscription/route.ts
import { NextRequest, NextResponse } from 'next/server';
import { prisma } from '@/lib/prisma';

export async function POST(req: NextRequest) {
  const event = await req.json();
  const data = event.data;

  switch (event.type) {
    case 'subscription.active':
      await handleSubscriptionActive(data);
      break;
    case 'subscription.cancelled':
      await handleSubscriptionCancelled(data);
      break;
    case 'subscription.on_hold':
      await handleSubscriptionOnHold(data);
      break;
    case 'subscription.renewed':
      await handleSubscriptionRenewed(data);
      break;
    case 'subscription.plan_changed':
      await handlePlanChanged(data);
      break;
    case 'subscription.expired':
      await handleSubscriptionExpired(data);
      break;
  }

  return NextResponse.json({ received: true });
}

async function handleSubscriptionActive(data: any) {
  const {
    subscription_id,
    customer,
    product_id,
    next_billing_date,
    recurring_pre_tax_amount,
    payment_frequency_interval,
  } = data;

  // Create or update user subscription
  await prisma.subscription.upsert({
    where: { externalId: subscription_id },
    create: {
      externalId: subscription_id,
      userId: customer.customer_id,
      email: customer.email,
      productId: product_id,
      status: 'active',
      currentPeriodEnd: new Date(next_billing_date),
      amount: recurring_pre_tax_amount,
      interval: payment_frequency_interval,
    },
    update: {
      status: 'active',
      currentPeriodEnd: new Date(next_billing_date),
    },
  });

  // Grant access
  await prisma.user.update({
    where: { id: customer.customer_id },
    data: { 
      subscriptionStatus: 'active',
      plan: product_id,
    },
  });

  // Send welcome email
  await sendWelcomeEmail(customer.email, product_id);
}

async function handleSubscriptionCancelled(data: any) {
  const { subscription_id, customer, cancelled_at, cancel_at_next_billing_date } = data;

  await prisma.subscription.update({
    where: { externalId: subscription_id },
    data: {
      status: 'cancelled',
      cancelledAt: new Date(cancelled_at),
      // Keep access until end of billing period if cancel_at_next_billing_date
      accessEndsAt: cancel_at_next_billing_date 
        ? new Date(data.next_billing_date) 
        : new Date(),
    },
  });

  // Send cancellation email
  await sendCancellationEmail(customer.email, cancel_at_next_billing_date);
}

async function handleSubscriptionOnHold(data: any) {
  const { subscription_id, customer } = data;

  await prisma.subscription.update({
    where: { externalId: subscription_id },
    data: { status: 'on_hold' },
  });

  // Notify user about payment issue
  await sendPaymentFailedEmail(customer.email);
}

async function handleSubscriptionRenewed(data: any) {
  const { subscription_id, next_billing_date } = data;

  await prisma.subscription.update({
    where: { externalId: subscription_id },
    data: {
      status: 'active',
      currentPeriodEnd: new Date(next_billing_date),
    },
  });
}

async function handlePlanChanged(data: any) {
  const { subscription_id, product_id, recurring_pre_tax_amount } = data;

  await prisma.subscription.update({
    where: { externalId: subscription_id },
    data: {
      productId: product_id,
      amount: recurring_pre_tax_amount,
    },
  });

  // Update user entitlements based on new plan
  await updateUserEntitlements(subscription_id, product_id);
}

async function handleSubscriptionExpired(data: any) {
  const { subscription_id, customer } = data;

  await prisma.subscription.update({
    where: { externalId: subscription_id },
    data: { status: 'expired' },
  });

  // Revoke access
  await prisma.user.update({
    where: { id: customer.customer_id },
    data: { 
      subscriptionStatus: 'expired',
      plan: null,
    },
  });
}

Subscription with Trial

const session = await client.checkoutSessions.create({
  product_cart: [
    { product_id: 'prod_pro_monthly', quantity: 1 }
  ],
  subscription_data: {
    trial_period_days: 14,
  },
  customer: {
    email: 'user@example.com',
    name: 'John Doe',
  },
  return_url: 'https://yoursite.com/welcome',
});

Customer Portal for Self-Service

Allow customers to manage their subscription:

// Create portal session
const portal = await client.customers.createPortalSession({
  customer_id: 'cust_xxxxx',
  return_url: 'https://yoursite.com/account',
});

// Redirect to portal.url

Portal features:

• View subscription details

• Update payment method

• Cancel subscription

• View billing history

On-Demand (Usage-Based) Subscriptions

For metered/usage-based billing:

Create Subscription with Mandate

const session = await client.checkoutSessions.create({
  product_cart: [
    { product_id: 'prod_usage_based', quantity: 1 }
  ],
  customer: { email: 'user@example.com' },
  return_url: 'https://yoursite.com/success',
});

Charge for Usage

// When usage occurs, create a charge
const charge = await client.subscriptions.charge({
  subscription_id: 'sub_xxxxx',
  amount: 1500, // $15.00 in cents
  description: 'API calls for January 2025',
});

Track Usage Events

// payment.succeeded - Charge succeeded
// payment.failed - Charge failed, implement retry logic

Subscriptions with Credit Entitlements

Attach credit entitlements to subscription products to grant credits each billing cycle:

Setup

• Create a credit entitlement (Dashboard → Products → Credits)

• Create/edit a subscription product

• In Entitlements section, click Attach next to Credits

• Configure: credits per cycle, trial credits, proration, low balance threshold

Checkout with Credits

// Product has credit entitlement attached (e.g., 10,000 AI tokens/month)
const session = await client.checkoutSessions.create({
  product_cart: [
    { product_id: 'prod_pro_with_credits', quantity: 1 }
  ],
  subscription_data: {
    trial_period_days: 14, // Trial credits can differ from regular amount
  },
  customer: { email: 'user@example.com' },
  return_url: 'https://yoursite.com/success',
});

Credit Lifecycle per Cycle

Each billing cycle:

• New credits issued — credit.added webhook fires

• Usage deducts credits — Automatically via meters or manually via API

• Cycle ends — Unused credits expire or roll over based on settings

• Overage handled — Forgiven, billed, or carried as deficit

Handle Credit Webhooks in Subscription Context

case 'credit.added':
  // Credits issued with subscription renewal
  await syncCreditBalance(data.customer_id, data.credit_entitlement_id, data.balance_after);
  break;
case 'credit.balance_low':
  // Notify customer or suggest upgrade
  await sendLowBalanceAlert(data.customer_id, data.credit_entitlement_name, data.available_balance);
  break;
case 'credit.deducted':
  // Track consumption for analytics
  await logCreditUsage(data.customer_id, data.amount);
  break;

Plan Changes with Credits

When customers upgrade/downgrade, credit proration can be enabled:

• Proration enabled: Remaining credits are prorated based on time left in cycle

• Proration disabled: Credits continue as-is until next cycle

Plan Changes

Upgrade/Downgrade Flow

// Get available plans
const plans = await client.products.list({
  type: 'subscription',
});

// Change plan
await client.subscriptions.update({
  subscription_id: 'sub_xxxxx',
  product_id: 'prod_new_plan',
  proration_behavior: 'create_prorations', // or 'none'
});

Handling subscription.plan_changed

async function handlePlanChanged(data: any) {
  const { subscription_id, product_id, customer } = data;
  
  // Map product to features/limits
  const planFeatures = getPlanFeatures(product_id);
  
  await prisma.user.update({
    where: { externalId: customer.customer_id },
    data: {
      plan: product_id,
      features: planFeatures,
      apiLimit: planFeatures.apiLimit,
      storageLimit: planFeatures.storageLimit,
    },
  });
}

Access Control Pattern

Middleware Example (Next.js)

// middleware.ts
import { NextResponse } from 'next/server';
import type { NextRequest } from 'next/server';

export async function middleware(request: NextRequest) {
  // Check subscription status
  const session = await getSession(request);
  
  if (!session?.user) {
    return NextResponse.redirect(new URL('/login', request.url));
  }

  const subscription = await getSubscription(session.user.id);

  // Check if accessing premium feature
  if (request.nextUrl.pathname.startsWith('/dashboard/pro')) {
    if (!subscription || subscription.status !== 'active') {
      return NextResponse.redirect(new URL('/pricing', request.url));
    }
    
    // Check if plan includes this feature
    if (!subscription.features.includes('pro')) {
      return NextResponse.redirect(new URL('/upgrade', request.url));
    }
  }

  return NextResponse.next();
}

React Hook for Subscription State

// hooks/useSubscription.ts
import useSWR from 'swr';

export function useSubscription() {
  const { data, error, mutate } = useSWR('/api/subscription', fetcher);

  return {
    subscription: data,
    isLoading: !error && !data,
    isError: error,
    isActive: data?.status === 'active',
    isPro: data?.plan?.includes('pro'),
    refresh: mutate,
  };
}

// Usage in component
function PremiumFeature() {
  const { isActive, isPro } = useSubscription();

  if (!isActive) {
    return <UpgradePrompt />;
  }

  if (!isPro) {
    return <ProUpgradePrompt />;
  }

  return <ActualFeature />;
}

Common Patterns

Grace Period for Failed Payments

async function handleSubscriptionOnHold(data: any) {
  const gracePeriodDays = 7;
  
  await prisma.subscription.update({
    where: { externalId: data.subscription_id },
    data: {
      status: 'on_hold',
      gracePeriodEnds: new Date(Date.now() + gracePeriodDays * 24 * 60 * 60 * 1000),
    },
  });

  // Schedule job to revoke access after grace period
  await scheduleAccessRevocation(data.subscription_id, gracePeriodDays);
}

Prorated Upgrades

When upgrading mid-cycle:

// Dodo handles proration automatically
// Customer pays difference for remaining days
await client.subscriptions.update({
  subscription_id: 'sub_xxxxx',
  product_id: 'prod_higher_plan',
  proration_behavior: 'create_prorations',
});

Cancellation with End-of-Period Access

// subscription.cancelled event includes:
// - cancel_at_next_billing_date: boolean
// - next_billing_date: string (when access should end)

if (data.cancel_at_next_billing_date) {
  // Keep access until next_billing_date
  await scheduleAccessRevocation(
    data.subscription_id, 
    new Date(data.next_billing_date)
  );
}

Testing

Test Scenarios

• New subscription → subscription.active

• Renewal success → subscription.renewed + payment.succeeded

• Renewal failure → subscription.on_hold + payment.failed

• Plan upgrade → subscription.plan_changed

• Cancellation → subscription.cancelled

• Expiration → subscription.expired

Test in Dashboard

Use test mode and trigger events manually from the webhook settings.

Resources

• Subscription Guide

• On-Demand Subscriptions

• Webhook Events

• Customer Portal

• Credit-Based Billing

• Credit Webhook Events

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