Subscription Management 101 for Experienced Merchants: Optimizing Your Business

But how do you go about doing this? We’re here to help! In this post, we’ll show you some actionable strategies you can implement to optimize your business.

Prioritize Customer Experience

In a competitive market filled with similar subscriptions, both in features, value, and price, it’s imperative that you prioritize the customer experience. For example, when faced with three similarly priced subscription options, customers will almost always choose the product that provides a better overall customer experience.

What exactly is an Omnichannel approach? It’s when you seamlessly interact to sell to and engage with your customers across several channels: from email to social media and your website. A quality Omnichannel strategy makes every new interaction with your customer feel like a continuation of the last.

Ultimately, when you use an Omnichannel approach in your subscription business you’ll build stronger relationships with your customers, which, as mentioned earlier, fosters trust and loyalty and allows you to generate more revenue.

Get Pricing Right

While it’s obvious that you want to get your pricing right, the process behind this can be quite confusing. This is simply because, nowadays, a one-size-fits-all pricing approach doesn’t work. In other words, you can’t use a single, static pricing approach when you price your subscriptions. If you do, you’ll limit your opportunities to upsell or downsell to both new and existing customers.

As such, you should rather consider a dynamic, flexible, and tiered pricing model based on your customers’ needs and demands. This will, for example, enable existing customers to scale down if affordability becomes an issue, or new customers to scale up if they need more of your products.

Keep in mind that your pricing strategy should also be aligned with your goals and objectives. For example, when developing your pricing strategy, you could focus on acquiring new customers by offering lower prices or providing more value at higher prices. No matter what strategy you choose, when you get pricing right, you’ll attract new customers, retain existing ones, and meet their needs better.

Reduce Customer Churn

When you want to optimize your subscription business and generate sustainable recurring income, it’s crucial that you reduce customer churn. As such, you want to retain as many customers as possible and increase the lifetime value of every customer.

Now, improving the customer experience, getting pricing right, and many of the other strategies mentioned here will go a long way in reducing customer churn, but it’s inevitable that customers will cancel their subscriptions. In these cases, you should find out why they’ve canceled.

To do this, you simply need to ask them, and you can do this in a variety of ways including, for example, customer feedback. Once you have this feedback, you’ll have insight into where you can improve your offering to retain more customers.

Provide More Product Value

We’ve already mentioned that pricing your subscriptions higher but providing more value can be a valid pricing strategy. Let’s now look at some of the ways you can do this in more detail.

For one, you can use discounts effectively to make more sales. Keep in mind, though, that you should carefully consider what discounts you implement, as higher discounts are typically associated with more churn while lower discounts are associated with lower churn. So, the discount strategy you implement should also be consistent with your goals.

Another effective strategy to provide more value is by implementing a loyalty system, where customers will receive points and benefits for making more purchases or referring others to your business. Finally, samples or free products can also be very effective at not only providing more value, but also promoting your subscriptions to new customers.

Use Data to Your Advantage

An often forgotten fact is that, with any business, you’ll gather vast amounts of data, and you can use this data to your advantage. And with subscription businesses, this is no different. But how can you use this data?

First of all, keep in mind that your data will give you profound insights about what your customers want and expect. These insights represent the true power of data, ‘cause they shine a light into what your next objectives should be, in order to meet your customers’ exact expectations and increase revenue.

Use the Right Subscription Management Solution

Finally, to optimize your business, you should choose the right subscription management solution. If you’re already using a solution and not reaching the objectives you’re carefully setting, you may need to evaluate whether your current solution is the right one for your business. If not, you should consider migrating a subscription management that is compatible with the strategies you really need.

This will typically be the case if you outgrow your current solution, because it no longer provides all the features you need to run your business effectively and efficiently. It could also be something you consider when your partner offers the features you need, but you’re ready for more advanced features in order to take your business to the next level.

Ultimately, to fully optimize your business, your solution should have all the features and capabilities that will allow you to implement most, if not all, of the strategies mentioned here.

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