Why start a subscription-based business?
A subscription-based business offers shoppers online a personalized, convenient, and low-cost way of buying what they need or want repeatedly. Besides, the companies get to scale their businesses and enjoy recurring predictable monthly revenue.
8 steps to launch a successful subscription-based business
Do you have a vision and are brimming with ideas to do subscription business? Know about building a subscription-based business and ensuring success through these 8 steps:
Step 1: Product Perfection
A business strategy relying on a subscription business is not new. It arrives with your morning paper as a service. Now, the technology advent comes with sophisticated customer service and marketing to reach a range of industries. Ensure product perfection that it must be exciting, valuable, and relevant. Only then, the customer will look to receive it regularly and wish to access it immediately.
An example of a subscription-based business is:
Spotify offers digital music services to access songs millions. The premium subscription gives additional features to users and removes adverts.
Step 2: Market research
Having an idea is not enough to get an avid audience. Concentrate on market research to create compelling services or products and promote them effectively. You must:
1. Research the market to ensure your subscription business has the potential to solve a problem.
2. Identify your competition by diving deep and finding out your customer’s choices before announcing a subscription-based business.
3. Know customers and pinpoint selling by understanding your customers. Assess the pain points and challenges; evaluate habits, leisure pursuits, and goals. Lure customers by offering unique selling points.
Step 3: Stay flexible
Pleasing customers is your aim. To extend the subscription lifetime, you must stay flexible. Offer various payment options, pricing, account preferences, and contractual agreements.
1. Pause their subscription when they go on vacation.
2. Offer beauty samples or personalize products to customers’ choice.
Step 4: Tried and Tested Tactics
Digital transformation is apparent, yet hooking customers requires following tried and tested tactics. Receiving a free box excites a customer and makes them enthusiastic long-time fans.
1. Give a free sign-up gift and your target audience will not miss it.
2. Check where they hang out and mix your tactics with mobile apps or give a free trial.
Step 5: Pricing
A business strategy of the subscription business is to give pricing options. Subscription businesses with two or three pricing tiers attract new customers. Keep the fee affordable in the lowest tier.
1. Include discounts for quarterly, half-yearly or annual fees.
2. Reward loyal users.
Step 6: Focus on Customer Service
Subscription-based business models need to offer good customer service. It should be impeccable that customers must feel you are always for them.
1. Give positive and personable customer service to retain existing customers.
2. Turn your customers to advocate your product or service and give them the benefit.
Step 7: Offer Suitable Payment Options
Customers using your subscription-based business look for more convenience. Offering convenient payment options promoting digital transformation is the recommendation.
1. Give payment option to set up once and to forget it.
2. Direct debit and inform them of the payment over the phone.
Step 8: Enhance Subscriber Experience
Customers flock to subscription-based businesses as they can unbox regularly new products. The subscriber experience must be a priority, so do proper market research, and keep customers feeling valued.
1. Send a gift as a surprise once in 3 months.
2. Give a discount on upgrading to the next tier.
Seeking ways continually to offer entertainment or value to customers ensures their experience stays fresh at all times.
