4 Ways to Improve Your Subscription Offering
Today, more and more companies are introducing a subscription business model. Whether it is a brand new subscription box startup, an established merchant that wants to provide its customers with the convenience of auto-replenishing their orders, a publication business selling a magazine subscription, or a tech company offering access to its software, there are similar factors that influence their success.
This article is for you if:
- You want to learn about strategies that will help you improve your subscription offering.
- You are looking for ways to reduce churn in your recurring revenue business.
- You are interested in spending time with an e-commerce expert to discuss a personalized business strategy.
As a whole, subscription e-commerce has seen tremendous growth during the past decade. Statistics from McKinsey & Company show recurring revenue businesses grew more than 100% per year from 2011-16. As a result, it is no surprise that investors and business owners alike find this growth, coupled with revenue predictability, extremely appealing.
But what do the successful subscription companies have in common? How do they get customers to sign up for a subscription? And, more importantly, how do they keep them?
Here are four strategies you can apply today to improve your subscription offering.
1. Give your subscribers a premium experience
Make your subscription customer feel special by offering them a service that is only available to them. Think of Amazon Prime, for instance. In exchange for an annual membership fee, subscribers can enjoy free two-day shipping, unlimited streaming of certain shows and movies and the ability to borrow books from the Kindle library. Remember, a premium price must equal a premium experience.
2. Show how the subscription brings value to the consumer
If you want your customers to opt for a subscription over a one-time purchase, you must give them something of tangible value in return for their commitment. This can be fulfilled in a few different ways. For example, it may mean offering a special discount that is only available to subscribers, or you could offer a free gift with the first delivery. For some subscription retailers, the value is simply realized in the form of convenience. Rather than remembering to place a refill order on time, the customer opts for getting it automatically delivered so they can "set it and forget it." Be sure to communicate your value proposition clearly.
3. Create a curated journey through personalization
Delight your subscription customers by offering them a highly personalized experience. Try surprising them with something new and innovative. This can be particularly important for merchants selling apparel, beauty products and food. Curation services account for 55% of e-commerce subscriptions, making them the most popular subscription type.
4. Deliver a great end-to-end experience
With more subscription companies emerging the market, it is important to set your business apart from the competition. One of the most effective ways to do that is by providing a superior customer experience from beginning to end. Think about your customer's journey as they interact with your product or service. Consider all touchpoints and channels. When you go above and beyond to meet the rising expectations of today's customers, you will enjoy lower subscription churn.
Starting a subscription business is an endeavor that can be well worth the effort if you have an in-depth strategy and avoid taking shortcuts. Hopefully, the list of dos and don’ts above will help get you off to a successful start.
If you would like individual guidance, we are here to help. Our $997 strategy sessions have helped several companies this year to grow their revenue by more than 20% in most cases. Reference this article, and the first session is on us.