> For the complete documentation index, see [llms.txt](https://developer.paddle.com/llms.txt).

# Term Optimization for Paddle Billing

Increase lifetime value and reduce churn by intelligently identifying customers on a monthly plan who are likely to upgrade to a longer term plan.

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## What's new?

We launched [Term Optimization](https://developer.paddle.com/build/retain/configure-term-optimization-automatic-upgrades.md) for Paddle Billing. Term Optimization is part of [Paddle Retain](https://developer.paddle.com/build/retain/set-up-retain-profitwell.md), designed to help you automatically reduce churn and increase customer lifetime value (LTV).

There are no changes to endpoints or fields in the API as a result of this change — it's an update to Paddle Retain.

## How it works

Our research shows that customers on an annual plan have a lifetime value (LTV) that's 2-4x times higher than customers paying monthly, and they're less likely to churn.

Retain [Term Optimization](https://developer.paddle.com/build/retain/configure-term-optimization-automatic-upgrades.md) analyzes customer engagement and other subscription data to determine which customers on monthly plans are likely to upgrade to a quarterly or annual plan, then automatically reaches out by email, in-app, or during payment recovery.

It's fully integrated with Paddle Billing, meaning Retain takes cares of upgrading subscriptions in Paddle when customers decide to switch to a plan with a longer term length.

## Next steps

This change is available now.

There are no changes to endpoints or fields in the API as a result of this change.

To get started with Term Optimization, check out our guide: [Configure Term Optimization and proactive plan upgrades](https://developer.paddle.com/build/retain/configure-term-optimization-automatic-upgrades.md).