Consumer mantras have come and gone but one rule has remained the same: the customer is king. The past year or so has seen a growing demand for subscription model among online shoppers. Customers have demonstrated a growing demand for customisation and flexibility, along with a willingness to pay for it, and businesses have heard them loud and clear. With the Internet of Things (IoT)rapidly making inroads into every business segment, everything from SaaS to gaming is inching towards a subscription-based model where the consumer pays a recurring amount periodically for a product or service. Reports suggest that in the US, almost 15% of online shoppers are part of a regular subscription scheme and that almost 50% of all subscription businesses that exist now, were started within the past one year.
Subscription modelsare an excellent way for retailers to expand their reach by offering products and services that are more customized to suit individual customer needs. With the winds greatly favouring the subscription business model, it is definitely a good time to bring out a model for your retail brand too. Many big brands have successfully emerged in this business segment and their success leaves us with some distinctive learning points.
Carve a Unique Niche for Yourself
Given the number of subscription packs in the market, if you don’t have something unique to offer, your business may just end up being a small fish in a vast ocean. Be it food, personal care products, apparel, or kids learning kits, you must tell the customer what is special about your model. It is important to learn about customer behaviour, their preferences and needs in order to create a deeper, stronger bond that will keep them coming back for more.
Keep your Pricing Competitive and Compelling
In business, it is critical to keep an eye on competition, especially when it comes to pricing your product. For a subscription business, competitive and strategic pricing can be tricky since customers tend to shy away from both very high as well as low priced products. Pricing has a direct impact on the growth of any subscription business. While attractive packages can help bring in new customers, it can increase value and trust among existing ones. Good businesses always remain flexible and watch what their neighbours have to offer as it is very easy to be edged out with early bird offers, freemiums and extended free trials.
Get Insights into your Financial Metrics
Key metrics not only tell you about the forward trend of your business but also give you a deeper understanding of customer value and your overall performance as a brand. Indicators such as retention rate, growth efficiency, lifetime value and monthly recurring revenue are critical to avoid blindsides. It is ideal to set up and follow a dashboard to track important KPIs regularly.
Concentrate on Content
Compelling and eye-catching content can make all the difference. It is what attracts the customer to a product. With so much information and so any ads around, consumers often get hooked to only those things that leave a lasting impression on them. Leading brands regularly distribute engaging content that gives their customers something to think about. Therefore, it is important to create inventive content—something that is unique and meaningful, that the customer can easily relate to.
Acquire an Omnichannel Presence
Every single customer is valuable, and it is important to acquire them from whichever channel possible. A well-established multichannel support system that is built on robust and scalable infrastructure can help you avoid rudimentary user flow issues in a multi-channel environment. Most successful subscription businesses make sure they have a seamless user experience onboard that enables customers across multiple channels to sign up without a fuss.Subscription-based businesses need a strong automated workflow that gives them simple yet fast customer acquisition over a multi-channel framework.
Putting together a subscription model that can appeal to a large number of customers is tough. Having the right foundation built on insightful data and research along with meaningful customer-brand relationship can help grow your subscription business to great heights. Building a brand that customers want to be associated with for a long time will not only bring new leads but also enable you to retain old ones who are happy to renew their subscription over and over again.
The above mentioned article has been written by Ajith Mohan Karimpana, Founder and CEO, Furlenco