The subscription model is expected to be the key to business development
If you think subscriptions are only for newspapers or media channels, you are failing to keep pace with e-commerce. In fact, subscription-based sales models are becoming increasingly popular both for digital and physical products.
According to Digitalist Magazine, by 2022, 53% of all software revenue will be generated from a subscription model. The numbers are amazing and the trend is sure to become viral.
Getting tried and tested goods and services delivered to you on a regular basis is a perfect timesaver for households, offices, and individuals. It is comfortable, helps avoiding store queues, filling in the delivery forms every time, and even the torments of making a decision each time. Finally, loyal clients often receive pleasant bonuses in their subscription boxes.
How to start a subscription-based business
If you want to start a subscription-based business, or add this option to your traditional selling models, follow these steps:
- Choose a product. Think about the target audience. Keep in mind that the usual subscriber age is around 25-44. If you want to tempt a younger/older audience into recurring payments, be ready to develop more creative strategies. Note that women like subscriptions more, but once men are into this format, they generally subscribe for more than one product. Be sure to provide complementary services and goods.
- Pay special attention to the packaging of physical products. It should be durable, bear a distinct company logo, and reveal corporate values in a creative and meaningful way. Being eco-friendly with your subscription box is your additional benefit.
- Promote your offer online. Social media will surely help. Ensure great quality, it will bring you more word-of-mouth buzz.
- Collect first feedbacks. Improve your product, design, or shipping terms if needed. Customize the subscription wisely. Those clients are going to stay with you long-term. Respect and honor their loyalty. They are also the best candidates to evaluate your service and suggest ways for improvement.
- Add appropriate technological solutions. Mobile apps and digital wallets can be incorporated to make subscriptions more flexible.
Your business may prosper once you choose one of the available subscription models. I’m sure there’s one suitable just for you.
A customer subscribes to a brand rather than a particular product. The company prepares surprise content for each delivery box, raising excitement and amazing the clients with the level of personalization. More than half of all subscribers choose this model.
This type of subscription is good for books, hobby kits, toys and games, organic products, health and beauty supplies, or grocery assortments like sweets, coffee, or tea.
A popular trend within the beauty industry is sending curation boxes with product samples. Customers can test new perfumes, shampoos, or face creams. After that, they often go on to order a full-size product.
Another interesting idea is the Use-For-A-Month subscription box. The companies send products that clients can use for a month and return in exchange for another one. Hence, fashionistas can boost their new jewelry or accessories regularly without overspending. The environmentalists will enjoy this re-use model per se. Books or games, as well as clothing, can also be considered for such a subscription.
The company tracks the product supplies sent to clients so that they never run out of them.
How annoying is it when you run out of toothpaste, cleaning fluids, or washing powder? Or else, you try to shave and discover that the last razor blade is dull. Not to mention, the embarrassing situations you get into when you run out of toilet paper, diapers, or female hygiene products. Of course, this model is also a great one for food deliveries. Not only households but also small businesses and cafes can benefit from it.
Replenishment boxes will help your customers to avoid such situations without keeping such small details always in mind. So many busy households, office managers, and parents of small babies would be grateful to free their minds of replenishing daily requirements.
There are many exciting replenishment options for the parents of babies and toddlers, in fact. Children grow quickly or less predictably, and buyers can use that fact for making their consumption trouble-free. They can opt for clothing packages, developmental toys, baby care products, baby food supplies, etc. All this can be easily customized to the changing needs, baby’s age, dietary habits, etc.
The least popular category is one that’s built on exclusivity. Some products are services available only to the members of a particular subscription group.
This model is very popular among media providers, as well as e-commerce platforms such as Amazon that offer exclusive deals for their VIP-members.
However, do not limit your imagination by what’s already on-trend. VIP-status is applicable to many more situations and services. Especially, the niche markets where the target audience is already very specific and narrow. These customers are already used to paying extra for following their passion. You can benefit from that, adding convenience and customization to their shopping experience.
In any case, you can always offer this exclusive model along with the cheaper regular subscription boxes after you gain a fair share of subscribers.