Subscriptions are expected to grow 653% in the next 4 years.
What you may not realize (which most companies also don’t) is that subscriptions can provide significant positive financial outcomes for a company including, but not limited to:
1 - Higher customer lifetime value (LTV)
2 - More predictable budget and inventory forecasts
3 - Greater business valuation for exits
Keep in mind, however, that adding a subscription-based product or service doesn’t just mean simply setting up the ability to get an ongoing shipment or service for a lower cost and ultimately put it on autopilot.
It has to be done right, or, it could either hurt the brand or be a lackluster waste of time and effort.
Proof that subscriptions are here to stay:
∙ In 2021 alone, existing subscription box brands grew their customer base by 31%
∙ Offering subscriptions has been shown to increase overall customer purchases.
∙ The average U.S. consumer now has (4) subscriptions
To be successful at subscriptions, these (4) methods are essential:
1 – Avoid the ‘add-on’ approach – Figure out your consumers’ unmet needs and how your subscription program will solve a business problem rather than mindlessly tacking on subscriptions to existing services and products.
2 – Win new customers by providing value—the right pricing, offerings and benefits
3 – Reduce churn by fixing credit card failures, saving canceling customers with the right solutions, upgrading and upselling term lengths and winning back canceled customers
4 – Retain customers with great products or services and a variety of great experiences
Do you have a subscription?
If yes, are you providing value and great experiences while also reducing churn?
If not, what’s stopping you?
About The CMO Syndicate
The CMO Syndicate is a diverse group of world-class Chief Marketing Officers who rapidly solve growth and profit problems for CEOs, VCs, CMOs, and PE firms. As global CMOs from the world’s top companies, The CMO Syndicate is not a traditional marketing consulting agency, and we are not typical marketing or growth consultants. We are growth experts and operators who actually do the work on a part-time or project basis as outsourced fractional and interim CMOs.