How to create a customer-centric, simplistic subscription model, that delivers growth in the age of Covid-19.

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How to create a customer-centric, simplistic subscription model, that delivers growth in the age of Covid-19.

The subscription e-commerce market has grown by more than 100 per cent a year over the past five years!

(Source: Mckinsey)


Covid-19 has shown just how quickly a dislocation can cause revenue to vanish, even from established customers. More worryingly, when a firm is no longer engaged with its customer, that historical relationship may count for little when that customer returns to the market, looking for a new solution to their problems. Firms with large cash balances have had resources to buffer the impact of Covid-19 and give them time to reorient, but firms with subscription business models have another powerful buffer: commitment revenue and committed customers.

Indeed, recent data indicates that only c30% of subscription businesses have experienced revenue contraction during Covid-19.

(Source: Forbes)

However, in such a saturated market, how do you ensure customers don’t quit for the latest, cheaper subscription? In this post, we will be looking at the top 10 focus areas for success.

  1. Competitive pricing structure: Strategic pricing is fundamental for retaining current customers as well as driving in the new. These prices need to be high enough for the business to be sustainable, yet low enough that customers don’t get scared off providing repeat business.
  2. Customer service: Research indicates that 15 percent of online shoppers have subscribed to an e-commerce service over the past year (Source: Mckinsey)Having an outstanding customer service optimizes user experiences and leads to more retention of your subscribers. We see this often in companies such as Amazon and First Direct.
  3. Forward-thinking development: Allowing for varied changing products with customization and innovation keeps subscribers and stakeholders engaged as well as reminding them of the good value product they are currently subscribed to.
  4. Customer control: Giving the customer an easy way to subscribe, cancel or freeze their membership at any time gives the subscriber the control to manage recurring payments. We see this often in food subscriptions such as Hello Fresh or Simply Cook.
  5. Sustainable subscribers: Knowing that your customers will consistently pay for your subscription by engaging them through new goods and speedy delivery, creates a sustainable subscriber base. Focus on this customer compound growth.
  6. User experience: Count on the convenience of the service to sell itself. The user experience should be simplistic, self-explanatory and efficient or risk losing customers.
  7. Freemium models: This would be the definition of try before you buy. Offering incentives to your subscribers to engage them with your product or service with little or no charge to the customer.
  8. Reducing inactive populations: Avoiding churn and prioritizing retention. Watching out for inactive subscribers and users they rarely engage with the product or service have the potential to ‘churn’ in the subscriber business.
  9. Quality control: Keeping a consistent handle on the quality of the product increases the satisfaction of the customer and decreases the need to rely on customer services to do patch repairs on unhappy subscribers.
  10. Be unique: Clarify the main messages of your business and what makes your unique from the subscription next door.


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