eWorld Fulfillment recently collaborated with Paysafe, a market leader in payment processing, to produce a great resource on growing subscription businesses. Read the summary below or check out the full article here
The subscription model is here to stay, both for services and products. Studies show that the market has been doubling every 12 months since 2011. While consumers are adapting to this new model, businesses must stay flexible too, since subscriptions pose several challenges that stunt traditional business growth.
- Upselling and Cross-selling
Customer Lifetime Value is essential to the subscription box model. Since acquiring a customer through today’s marketing channels is quite expensive, the ROI on each customer needs to be increased. Upselling and cross-selling additional products to existing customers is an excellent way to up your numbers without the associated acquisition expenses.
- Be the Expert
Subscription box businesses need to set themselves apart by becoming the go-to resource for their customers. Instead of merely providing the product, they need to add additional value by providing expert advice and little-known information on their products. By educating their customers, they’ll boost loyalty and gain credibility in the market.
- The Problem with Payment
Declined transactions are a significant problem in the recurring revenue market. Whether it’s due to outdated bank details or an expired card, it disrupts the seamless user experience that businesses are trying to create with the subscription model. Partnering with a professional payment service provider (PSP) can smooth over this process and recoup some of that lost revenue.
- Focus on Fulfillment
Often a last-minute consideration, fulfillment is one of the most important factors in the subscription business model. For a seamless and professional customer experience, it’s unreasonable to think you can scale without outsourcing your fulfillment. Find a third-party fulfillment service that specializes in subscriptions and care about each customer as much as you do.
- Show me the Money
When it comes to payment, user experience is key. There are several payment methods available to consumers, and you should give them their option of choice. Make sure that the Payment Service Provider you partner with supports mobile and omni-channel payments, as well as regular eCommerce methods.