The current business environment demands high-level innovativeness and flexibility if your business is to remain afloat. Technology is defining the pace and, therefore, every business is looking for new ways in the technological realm to outsmart their competitors and win customer loyalty. As a result, different business models are springing up, with the online space dictating market trends. Start-up or not, your business must have some online presence and, where possible, an online store. The businesses playing the conservative card are paying dearly, losing their clientele to some of the most unlikely players.
One surprise entrant in eCommerce is the subscription business model. Not that it’s not been around. No. Just that it’s gained ground over the recent years and it continues to do so at quite a surprising speed. Nowadays, almost everything is being delivered to your doorstep. And when you follow it up, you realize it’s a subscription package from some online store.
From drugs to food, personal effects to home decor, companies are continuing to deliver products and services at the convenience of customers. Offering customers this convenience is a little more expensive than selling at your local store. However, sidestepping it would be more disastrous to your business.
Subscription business model wouldn’t be giving local stores such sleepless nights if it lacked demonstrable advantages. For someone running an online store, whether it’s a WooCommerce or whatever other systems, subscription is fast becoming indispensable for businesses keen on establishing revenue stability.
Here are some of the reasons why you need to offer subscription on your online store.
Recurring Income
If there is something every business is longing for, it’s the ability to earn stable revenue on a regular basis. If you’re running a WooCommerce online store, you must have experienced high and low seasons. Forget about those dictated by such seasons as Christmas.
There are times when sales just spike and then drop mercilessly within a very short time. Such a reality would disorient a business that doesn’t have a regular source of income. But for those that have a strong subscription base, such jerky sale phases don’t yield adverse results.
Subscription, therefore, is quite a beneficial business model. To introduce it in your business, however, you’d need to do some homework, specifically to establish what would work best for your business. For example, if you’re selling a software program at a one-off fee of $500, you may consider offering at a subscription fee of, say, $25 a month. Doing so would most likely boost your client base and raise your profits over time.
If your online store has a sizeable subscription base, you also enjoy the ease of financial planning. This is because you know the billing periods, making it possible for you to distribute your business expenses around the billing cycle.
Improved Customer Loyalty
The statistics favor subscription programs. An amazing 93% of customers are willing to make repeat purchase from companies that offer them exemplary customer service. How about if you offered a great product, a professional customer service, and a subscription? Definitely, your customers would be more than willing to establish a long term and loyal relationship with your business.
With 60% of loyal customers ready to make frequent purchases from the same company that offers them great customer service, you can use subscription to expand and strengthen your customer base. The interesting thing is that the average customer is even willing to pay a slightly higher amount, provided the service is excellent.
The other advantage of subscription on your online store is that you get to know your customers better. This helps you to fine-tune your products and services to suit their needs. Loyalty is also likely to earn referrals for your business. Most people readily recommend the products and services they’ve used with satisfaction.
Platform for Marketing
People still read marketing emails. You also do, right? Yes, we hate seeing them drop in our inbox, but if it’s properly done, we’d spare a moment to read it. What if it’s coming from a company whose products you’ve subscribed to? That can’t just go unread. You may want to trash it, but you’re not going to do that until you read its content.
As a business, you can take advantage of this customer loyalty to introduce new products or features. Because your business is interacting with the customers on a regular basis, the business will get to know more about the customers and consequently tweak the products and services to meet client needs.
Simple Business Management
By virtue of being regular, subscription makes business management quite simple. For a business, the instructions for the despatch of products and services to the subscription customers remain pretty much the same every distribution cycle. Once you’ve set a working formula, it’d be repeated the very same way, making the management of the process quite simple.
Because the customers are already loyal to your business, you don’t have to spend money trying to entice them, but would rather spend the resources towards winning new customers. This will help your business to cut down on marketing costs, but also save time that can then be used to champion customer interests. Besides the advantages your business enjoys, your customers are also advantaged because they don’t have to place a new order every time.
Allows for Trial Offers
This is particularly evident in the software world where companies allow users to test products for free for a given period of time before buying. Because the subscription amount is smaller than the amount usually asked for in a one-off purchase, many users often subscribe after the free trial.
But even if a customer doesn’t buy immediately, you have the trial period to get to know them, get their contact details and share with them important information about your business and products thus putting you on a pedestal for possible future business engagement with the customer.
Higher Retention Based on Expertise
Generally, subscription basically means retention. But there is another angle to it. In a case where a customer has subscribed to a product, say software program, the customer is likely to be retained if your business manages to prove its expertise, provided the other factors remain optimal. As an online store, ensure you demonstrate to your subscribers that you’re the best in the trade so that they don’t waver on their resolve to stick with your company.
Conclusion
There is no business that’s not looking for stability, particularly on matters revenue. If you introduce the subscription model to your WooCommerce store, you’ll definitely reap admirable benefits and realize business growth over a very short period of time.
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