Subscription services are one of the most powerful tools for generating sales, and not just because they’re trendy. Monthly payments typically allow customers to enter your sales funnel at a smaller price point without devaluing your current line of products and services.
Even if you don’t think your current business model is compatible with subscription services, you can increase revenue and collect significantly more leads by creating a subscription alternative. Here, we’ll show you how any business can begin making money from subscriptions, and give you a few pointers on how to get started.
But first, how much money can you expect to make?
Most Subscriptions Last About 6 Months, With Some Exceptions.
In most cases, boxes and digital services will be canceled in about 6 months. Your customer loyalty may be much greater; some box delivery services retain their customers for as long as 17 months or more.
But before you get started, when you’re trying to price your subscription and estimate your ROI, a 6-month average is probably the most likely outcome.
When planning your subscription, consider the following scenarios:
- 3-month average subscription.
- 6-month average subscription.
- 12-month average subscription.
If your ROI is positive with all these possibilities, you’re on the right track. If you find that customers are canceling before 3 months, you may need to significantly improve your value offer. Make sure you aren’t giving away too much upfront and be sure there’s a good reason to stick around.
Now, let’s look at some strategies for creating a subscription in any business model.
Strategy #1: Create a Subscription for Ongoing Service and Updates.
Virtually any product or service could include an option for ongoing service.
At first glance, DNA test kits and reports don’t seem like a good opportunity for subscriptions. After all, once the report is printed, what else is there to do?
However, new research is constantly being done to investigate the human genome. By adding a subscription for ongoing updates and access to the latest research, DNA services now make significantly more money from customers than they did before.
Subscriptions can work for nearly any product or service. Protection plans, updates, maintenance, and premium customer support are just a few of the easiest options.
Strategy #2: Partner with Another Business if Necessary.
When your core business model simply doesn’t lend itself to subscriptions, consider partnering on a joint venture with a related business.
- If you sell cookware, you could partner with a food delivery service.
- If you sell running shoes, you could partner with a supplement company.
- If you sell coffee mugs, you could partner with a coffee subscription box.
For every business that has a one-off product or service, there are hundreds of related items that need to be replenished frequently.
Strategy #3: Create an Informational Subscription to Accompany Your Usual Products.
Whether it’s a newsletter, digital course, or membership platform, people are happy to pay for information when it improves their lives.
Do you sell herbal tea? A newsletter on relaxation techniques would work perfectly.
What about children’s books? Digital courses on improving your child’s learning would get your current customers excited.
There are simple, low-cost ways to start offering subscriptions to the customers you already have while using it as an opportunity to bring in fresh leads. All you have to do is get started.
Get Help Building Your New Subscription Service.
If you want to start generating more income, you’ll want a reliable subscription service that effectively manages your customers and optimizes their experience.
MaxQ Technologies is an industry leader in the subscription billing arena. Our integrated suite of products is designed to work with any subscription model, simple or complex, making it ideal for whatever services you think up.
Speak with us today to see what we can do for you. Contact us now to find out more about implementing a successful subscription-based model.