Investment in the subscription-based business model has skyrocketed in recent years, and it’s easy to see why. With the right framing, you can turn an uncertain prospect into a loyal customer in a single conversion, and you can bring in consistent revenue with far less effort than a typical ecommerce business would need to commit.
You can put whatever you’d like behind your subscription, of course. Material goods (there are many one-box-per-month sellers out there), digital goods (e.g. educational materials), or even consultancy services. This gives you ample leeway to create the kind of business that suits you, making the model all the more appealing.
But there are negatives to go alongside those major positives: most notably the proliferation of subscription businesses already on the market and the serious difficulty of achieving the aforementioned framing (the kind capable of winning someone’s long-term business).
If you’re going to make your fledgling operation a success, you need to get off to a great start. To that end, here are five things you need to nail when starting a subscription business:
Your Research
As noted, competition will inevitably be high, and that means the first thing you need to nail is your niche research. What are the heavy hitters in your chosen area? Assuming there are already subscription businesses that do what you’re planning to do (or at least come close), what are they doing well? Perhaps more importantly, what are they doing poorly? Your objective must ultimately be to outperform them, so this is vital information.
Remember the importance of pricing. You obviously need to profit, but you can’t exceed the standard rate by much if you’re going to compete. You should also look into the needs of your prospective customers by following their social media activity. Where do they post? What do they talk about? Pay particular attention to their relevant grievances. The more you can build your business around addressing those grievances, the more easily you’ll attract their attention.
Your Promotion
Before you can sell to someone, you need to draw them in, and for that you need marketing. No one will visit your website apropos of nothing in particular: they won’t take the time to diligently hunt it down. There’s no shortage of sites to visit, after all. If they’re going to pick yours, there needs to be a good reason. So what reason can you give them? And where can you mention it?
Your research will inform this heavily, particularly when it comes to social media promotion. You may want to run PPC advertising if Facebook is the most prominent channel, or prefer to put that money into influencer marketing if there are prominent influencers in your niche that don’t have prohibitively-high partnership rates. The key is that you pay attention to results and adapt your methods accordingly. If your strategy isn’t working, try something different.
Your Website
If an interested prospect lands on your website and finds it keenly disappointing (or perhaps even outright confusing), all your preceding effort will be wasted. Your website represents the entirety of your brand. Additionally, first impressions matter more for you than they would if you were running a typical retail operation: if you lose someone, they’re very unlikely to return unless you radically change your service at some point.
You should start by choosing a great theme — ideally a paid theme if you can accommodate the cost. Next, focus on getting your website copy right. It needs to get across all the vital details while seeming both professional and welcoming. You also need to think about optimizing performance, displaying social proof, and doing anything else that might help.
Your Software
Running a subscription business might not be as time-consuming as running a standard store, but it still takes effort. You need to keep track of your subscriptions, determining when it’s best to pursue renewals, adjust your value proposition, or even change your pricing model. You might want to introduce a further tier to accommodate more customers, for instance. For this, you need software to make your life easier.
Thankfully, there is such a thing as a subscription management platform, bundling together numerous features relevant to the core of your business. Throw in some software tools for financial management and social media updating, and look for suitable CMS plugins (there will be many for you to choose from assuming you’re running WordPress). This will significantly reduce your workload, saving you time and energy.
Your Support
Lastly, something that sets some subscription businesses apart is the quality of their support services. They know how to be there for their customers when it really matters — and given the ongoing nature of subscription businesses, keeping them around is essential. Simply having a contact form with a vague promise to respond when possible won’t cut it. You need to have live chat support available at least some of the time, perhaps with a chatbot to provide backup.
This is an area in which you should go above and beyond customer expectations. After all, outside of the core elements of your subscription model, what will matter to people more: how much you charge, how frequently you roll out updates, or how you respond to complaints or queries? Money matters, but modest price fluctuations aren’t issues. Updates matter, but a cutting-edge feature can wait. Service, though: that’s always a key concern.
Wrapping up, running a subscription business can be a fantastic way of making money if you get it right. You can enjoy a level of consistency and regularity that other businesses can’t rival, and lean on that to consistently improve your business without enduring too much stress. But getting it right is far from easy. If you’re going to do it, you need to focus on getting the essentials right, and the tips we’ve set out here should help.
