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Whether you’re a new or established subscription merchant, you are likely always on the prowl for strategic marketing tips.
This article is for you if:
- Are looking for the best options for managing recurring revenue on your website
- Are new the subscription economy and are looking for proven marketing tips
- Want social media marketing tips for your subscription business
- Would like to speak with an e-commerce expert for more marketing tips and advice
Before we get into the weeds of some marketing basics for recurring revenue businesses, the first order of business is ensuring your website and other tech processes are configured for success. In addition to investing in a well-produced, search engine-optimized website, what is your plan for managing your subscription orders?
One way to accomplish that goal is by way of your e-commerce platform. Finding the right e-commerce platform is something each business must determine individually. Magento is a popular platform for enterprise-level merchants, so we recommend it for any business that plans to scale. Starting off on the right foot in this area will save you from having to perform a costly re-platforming effort later.
Magento boasts many impressive statistics, including the fact that they are the second-most popular e-commerce platform in the world. While the Magento e-commerce platform offers many benefits for online merchants, it does not offer a way to manage subscriptions out of the box. Therefore, merchants that collect recurring revenue must rely on a third-party plugin. The mPower subscription management solution is a robust option because of its flexibility, user-friendliness and functionality to meet a diverse set of business needs.
If you want to know more about how mPower works, check out the video below.
Another way to manage subscription orders is through your customer relationship management (CRM) system. If you have not chosen a CRM, we recommend Salesforce because of its solid reputation and vast features.
However, like Magento, Salesforce does not have an out-of-the-box subscription management solution. Recurrex is an add-on that closes this gap. Watch the video below to see how it works.
Aside from perfecting every aspect of your website, here are our top four marketing tips for generating more recurring revenue.
Marketing Tip No. 1: Prioritize customer retention over customer acquisition
As you develop your marketing strategy, your emphasis should be on customer retention rather than customer acquisition. We discuss this more in-depth in our previous blog post, but to summarize some key points:
The likelihood of selling more products to an existing customer is 60-70% (compared to a 5-20% chance of closing a deal with a new prospect).
Existing customers are 50% more likely to try new products.
Existing customers spend 31% more than new customers.
The statistics above, provided by Invesp, demonstrate the importance of casting your marketing net close to home for the biggest return on investment. You can achieve this through several tactics — such as upselling, cross-selling, product-bundling, leveraging free gifts and pre-selling new items. Our previous article goes into detail on each of these strategies.
Marketing Tip No. 2: Get your brand identity to a solid place
Marketing Tip No. 3: Build your email list
This is something you will want to get started on early on. This means you will want to make your website conversion-focused with several landing pages.
According to HubSpot:
- 80% of businesses believe email marketing increases customer retention.
- 78% of marketers have seen an increase in email engagement over the last 12 months.
- 59% of survey respondents say marketing emails influence their purchasing decisions.
- Marketers who use segmented campaigns note as much as a 760% increase in revenue.
In order to build successful email campaigns, you must first build an email list. Can you offer something of value in return for an email address, such as a free online course or e-book? Set up a capture page that collects that information in exchange for your freebie.
You will also want to invest in an email marketing platform so you can automate messaging and keep your email list organized. Some popular options are Drip, Constant Contact and MailChimp. Check out this comparison for more insight.
Marketing Tip No. 4: Offer a free trial period or discount
While your customer retention efforts should trump your customer acquisition efforts, you can not ignore recruiting new spenders entirely. Offering a free trial period or discount incentive is a strategic way to lure new customers into a long-term relationship with your brand.
This will look different depending on what kind of subscription service you offer. If you have a streaming service, offering a 7-day free trial is simple enough. However, if you are selling physical goods, a discounted first order or free shipping offer is likely a more sensible route to take.
In addition to increased brand exposure, free trials and discounts are also a great way to build your email list. Even if a customer does not follow through with an ongoing subscription order, you will still have the opportunity to market to them going forward. (Check out this article from Neil Patel for advice on marketing to customers when a free trial is over).