There have never been that many opportunities in the eCommerce industry, nor has there been as much competition. We've all witnessed exponential growth in subscription and reoccurring billing with tons of SaaS software companies, retail chains with brick-and-mortar stores, and many big brands. Incorporating a subscription scheme into the long-term growth plan has been impactful across eCommerce industries.
The consistent delivery of products and services
In today's rapidly-paced society, customers are consistently looking out for the most intriguing, the latest, and the best content empowered by the mighty search engines. From retail giants like Costco or Walmart down to the solo entrepreneurs, we've all tasted the benefits of reoccurring revenues generated from memberships, monthly subscription fees, etc. Customers can enjoy better and faster door-to-door delivery and rapid deployment of digital products and services right to their devices.
From local to global markets, subscription box has been proven a viable strategy to grow the business. If you sell software or knowledge-based products, delivering your products in digital forms avoids sidestepping the issues like shipping costs. If you sell physical products like food & beverage or beauty products, the subscription revenue is a great tool to offer customers free shipping and exclusive discounts.
Maximize the potential of reoccurring revenue
Adopting a subscription-based revenue model will allow your business to have a much more predictable income stream. The traditional "one-time selling" model has been proven to hit a dead-end, especially during the pandemic years. It shocks people how unpredictable the revenue streams could be and how fragile your business could be.
Many business owners tested the water during the pandemic and feedbacked to us. The subscription may be hard, to begin with, but it offers you not just steady cash flow but also a great way to know who the real and active customers are.
Minimize the customer churn
Customers are the at-all-time center of any business of any size and shape. Building a solid customer foundation with long-lasting rapport is the key to optimizing customer lifetime value. Onboarding a new customer could be five times more expensive than keeping an existing one.
Encouraging customers to subscribe to your consistent product or service delivery help to significantly cut down the customer churn rate. Dividing a big bill into smaller monthly morceaus has created a tight knot to your customers' credit cards. However, many people find subscriptions that are much more tolerable and affordable to acquire a longing service or product. And smaller periodic payment option does help reduce payment rejections or failures.
The debate on subscriptions can go on forever. However, examining the success cases under the microscope, the winning formulas share common traits.
- High-quality and unique products, services, or knowledge.
- The capacity of fulfillment, shipping, delivery, and after-sales.
- The power to generate or produce unique content.
Some final thoughts
Creating a subscription channel can be achieved quickly, but we ought to contemplate what are the products, services, and knowledge that our customers will consistently look for and require. Having the power to create unique content is more promising than letting the customers decide your fate.