Subscriptions Done Right
Introducing new sales techniques into your business can be daunting. It’s important to fully understand what it is you’re getting into, whether your business admin can handle the logistics and if it is something that suits your business structure and model.
When looking at offering subscriptions, you first need to understand what this means. A subscription model is when you charge customers a recurring fee, which occurs on a recurring time loop and that grants customers access to a product or service.
It’s a smart move. A really smart move. If you know how to incorporate it and work with your clients needs.
Why You Should offer Subscriptions
The market is constantly changing and it sometimes feels like it’s even getting more complicated. Customers long for hassle-free, planned, immediate and easy-to-receive (easy shipping) options.
This falls perfectly into the subscription model. Think about all the potential your business would have when going down the ‘subscription’ avenue and all the customers who want convenience, reliable delivery and new products straight to their door.
It’s a service that you offer to your customers on a recurring basis.
What does this mean for you?
This firstly means that customers need to sign up for the service beforehand, so you will get a rough figure of sales from subscriptions in advance. Having some form of pre-planned sales figure can be the make or break of a business. Knowing that you’ll have 30 subscription boxes going out monthly for the next three months at $50 each means that you'll have a minimum monthly revenue of $1500. Having this kind of information before the month end is huge and can be a real nerve calmer.
It also means that you know that you have a set amount of customers who are actively interested in receiving products and news from you on a recurring basis. In a subscription box you can include marketing material that shares more information about your business. It’s a lovely touch if you are just starting out and you’d like to include an ‘About Us’ or ‘Why We Started’ pamphlet. Knowing that there are loyal customers out there that support you will boost your (and your teams) morale.
It also gives you the opportunity to engage with your customers in a more personal and direct way than if they were to simply order what they want from your website. You get to craft and dedicate a subscription box to each of your loyal customers. You could offer subscription boxes every time you have a new product launch which would be twice a year. Or you could offer a subscription box at every new turn of the season, with seasonal inspired goodies. Or you could send through a monthly ‘pamper yourself’ subscription box.
When it comes to why you should bring in subscription boxes and how this could affect your figures, we found a clever source to support subscription model incorporation:
Ecommerce subscriptions likewise help brands increase repeat purchases since you don't have to win the business ad hoc every time if you have a loyal, subscribed customer base. You have a 60-70% chance of selling to an existing customer, versus a 5-20% chance of selling to a new prospect. (source)
It’s a business model that is booming and is a market that is said to be worth 246.6 billion by 2025. (source)
In the long run it also reduces the cost of acquiring new customers as subscription customers tend to turn into loyal customers who tend to turn into fans who tend to turn into lifetime customers. The longer a customer supports you, the more value they bring to you, and increasing value should be one of your top priorities.
Why Would A Customer Subscribe?
There is so much out there on the market, from tech gadgets to beauty products to sneaker lines. The market is full of exciting, modern and often very useful products. With so much on offer, many customers feel intimidated by the whole online shopping process and abandon their cart before they’ve managed to scroll through only just one quarter of a company’s page.
This is where a subscription box can come in handy. Allow your customers to explore through your range without needing to go online every time they feel like having a product from you. Give them peace of mind that they won’t be left behind, that they will receive the newest products from you and that they don’t need to ‘waste’ their valuable time every month doing a job (choosing products) that the business can do on their behalf actually.
By offering value for money, you will go a long way with a subscription model. If you are able to box together a variety of products and offer these at a slightly discounted price, then both you and your customer win. You make a great sale, and they receive more than they would have otherwise spent buying each product individually.
Eventually, you will also be able to offer personalized boxes. It’s much easier (in terms of time management and logistics) to send out the same box to each of your clients. However, as you get to know your clients better and get into the swing of sending out subscription boxes, you may want to look into personalizing these. This could look like sending out ‘Men’s Grooming Kit’ on a monthly basis, and changing the balms to suit each of your customers personal preference eg. Eucalyptus, Rose or Ginger root. This will make your customers feel more special, which will make them more likely to continue signing up for this service and they’ll feel that their needs are being individually met.
Lastly, be creative! Thinking out the box will allow you to stand out from your competitors. If you send out a monthly wine tasting picnic basket for example, include a different wine each time and match it with a different local cheesemaker’s cheese selection. Or if you send out a monthly skincare subscription box, send out an email beforehand with a pre-prepared playlist that can be listened to whilst applying all the toners and moisturizers. Think of something new! It doesn't need to be something monetary or a clever collaboration, it can also just spark fun and curiosity for your customers and heighten the enjoyment factor for them.
There are some clever companies who have come up with cool ideas around their business, take a look below:
They send out a monthly murder mystery game!
Every three months you will receive the latest nifty tech gadgets.
A monthly tea connoisseur service.
Each month you can choose a new book from five options.
Receive a monthly box of games for children to help them in their development.
There are so many ideas that you could work on within your current product selection. Just think of something creative, something reasonably priced, try to create a unique experience around each send out to avoid it getting mundane and then market your idea!
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Natalie MillerMarketing Manager
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