Building Your Subscriptions
A Guide to Growing a Low Cost Parallel Business
Why should you consider offering a Subscription Service?
There are many benefits of a subscription service, besides a new business and revenue stream, find out more below.
Your customers stay your customers
Your customer expects to pay you a certain amount of money regularly and all you have to make sure is they get what they asked for. A bit like coming into your store, picking up what they want and paying you – but regularly, like clockwork – you don’t have to worry about whether it is too sunny, raining, snowing or holidays. You don’t have to worry whether your customer has popped into a competitor’s store. Your customer isn’t going anywhere, they want a relationship with you.
Your customer doesn’t have to worry if prices have gone up, doesn’t have to worry if what they want is on the shelves. They have peace of mind in knowing what they give you each month, helping them budget. Just as your customer has committed to you, you have made a commitment to deliver what they want too.
As the months go by, your customer realises how convenient your subscription service is. What they want is delivered straight to their door, there are no payment surprises and no precious time wasted travelling to your store, although they still will to purchase other goods you may have – after all they are your store customers!
Subscription services establish and promote your brand and loyalty to it.
Engaging with your customers
Without any marketing on your part, you will engage with your customers at least 12 times a year if they have a monthly subscription. Add to that any store visits or emails you may send out – that is a significant amount of brand awareness isn’t it?
Each time your customer opens your supplement box to take out their daily personalised pouch, they will think about you! They will also think about you when they open their pouch and take their supplements. That is twice a day, 730 times a year and that doesn’t include receiving your box or logging in to amend their order. It’s quite clear to see, a store visit pales into comparison when comparing against a subscription service.
By its very nature, a subscription service means subscribers. Where would Youtube entrepreneurs be without subscribers? You have an opportunity to speak directly to your subscribers, offering deals, promoting products and events, you may even just want to wish them a Happy New Year!
Spending a few minutes signing up to your subscription service will save your customers many minutes. They don’t have to think about arranging their day to visit your store or somebody else’s to get what they need. They don’t have to spend hours researching online for a better deal, they will have done that initially to get to you. They will be pleased knowing they have a great deal and you will be pleased with regular income from your customer.
All your customer is looking for is for you to fulfil your part of the deal and deliver what you said you would, at the time you said you would. The convenience of giving your customer what they need when they need, not only keeps them signed up, you can benefit from the regular payments into your bank account.
By breaking down purchases on a monthly basis, your customer appreciates the more manageable monthly payments rather than shopping binges every so often, where you are at risk of not having everything available or they clear your shelf meaning your other customers may lose out.
Cash flow (again)
Unless there is an unforeseen event, payments to your bank account from your subscribers will be as regular as clockwork. What you received in month 1 will be either be matched or improved upon in month 2. Knowing this, you can plan for other business costs and investment you may have. You don’t need to worry about what the weather is like, what month or season of the year is and whether it will affect your footfall. Your bank will also appreciate regular credits to your account rather than fluctuations in your balance over the course of the year.
The more customers you have on a subscription model, the more you can rely on the income every month. Your brand should also grow faster.
If your subscription customers want certain products regularly, you will know exactly what to buy to make sure you never have unsold stock or products that will just sit on your shelves gathering dust. Everything you purchase for your subscription service, you know will be delivered to your subscribers at some point.
You have this great opportunity to transform customers from one-time shoppers into repeat customers by asking them to sign up to your subscription service.
All retailers know it costs up to 7 times more to get a new customer than to retain your existing one.
Once you have a customer who has taken out a subscription, it is quite possible they will remain your customer for a considerable period of time – as long as you fulfil what they need on a regular basis, you will retain your customer.
The longer your customer stays subscribed to your service, the more revenue you earn – it’s as simple as that. No need to make 2 for 1 offers, or constantly check what deals your competitors are offering, you have a customer who has promised to pay you regularly, all you have to do is manage your sale.
Once you have a sizeable subscription base, you can analyse trends, what is being ordered, what sells, what doesn’t , what is trending and what has had its day.
You can use this information to better manage your store. If suddenly, dieting is no longer something your subscribers are interested in, you may want to consider this the next time you place an order for your subscribers and your store..