Have you considered a subscription model for your business? With a subscription, customers receive regular deliveries of products or services rather than placing individual orders.
Why would you want to offer a subscription? The subscription model offers benefits for both you and your customers.
Subscription Model Benefits
For starters, the subscription model provides a predictable income stream. Knowing that you can count on a certain amount of revenue each month enables you to better manage cash flow, inventory, and resource allocation.
Because subscription billings are automatically deducted from clients’ accounts, you also eliminate the cost and hassle of collections.
Another benefit is the opportunity to upsell. As you evolve your relationship with subscribers, you build brand loyalty and learn more about your customers.
This enables you to offer additional services targeted to their specific needs. These may be ancillary services, premium services, or discounts for longer-term subscriptions.
Finally, the subscription model provides data that you can use to keep track of recurring revenue, conversion rates, return on advertising investments, and much more.
The first step to adopting a subscription model is to design a version of your service with a standardized package of features that can be delivered each payment cycle. It’s a good idea to offer several options.
You may also want to consider offering free trials when you’re first starting out, to encourage early adopters.
Additionally, make sure the platform you are using supports automatic billing via credit card and the ability to collect customer data and preferences.