Subscription business is one of the most popular types of businesses in the world today. Every day, the concept of doing a subscription business is gaining more and more traction globally. If you feel lost and think you do not know what a subscription business model is, just think about websites and apps like Netflix or Amazon Prime Video. You pay a monthly fee to access the content on these websites. These are just two of the most basic examples of a subscription business model. Still, if you pay attention, you will find many other examples of subscription businesses around you as well.
Read on further to learn about starting a subscription business in this day and age. First, we will define a subscription business model and then discuss the importance or benefits. In the end, we will give you a method of starting a subscription business online in the simplest possible way.
What is a Subscription Business?
As we mentioned above, the simplest way to understand what a subscription business is is to think of it as selling a product or service based on a recurring revenue stream. This means that if you stop receiving money from the customer on a weekly, monthly, or any other predetermined time basis, then you revoke that product or service from them. Unlike simply purchasing something and then owning it forever, you have to keep paying for this good or service.
For the sake of better understanding, you can even think of it as the same type of thing as paying the monthly rent of a house to live in it, or paying the electricity bill every month so that you continue to have access to electricity in your house. Basically, doing a subscription business feels like being the landlord of a house that people are renting from you.
If you are a business owner and looking for ways to expand revenues and profit, you must be wondering about the potential gain of adding a subscription to your business. Well, you are definitely at the right place because we are about to tell you exactly that!
1. It Attracts More Customers
One of the most basic things about a subscription business is that the customer doesn't need to be fully committed to your product or service to purchase it. They can buy it just for the sake of trying it out or even if they just need it for a little while.
Additionally, subscription business benefits include how customers who are not looking to purchase your goods or services for a long time might just change their minds once they purchase it as a one-time thing and become long-term customers. This means the subscription business model helps you increase your customer lifetime value.
Suppose you will have issues calculating your revenues to compute them in your sales report and keep up with them, especially if you are new to the business world. In that case, doing a subscription business will significantly benefit you in this endeavor. “Why?”, you ask. The reason is quite simple. The total sales amount during a specified period is decided at the initial time of sale. You can very easily be aware of the amount of revenue that will come in during that period.
3. The Trial Period Advantage
Perhaps one of the most unique things about a subscription business is the ability of it to let the customers or potential customers have a trial period to decide whether they want to continue using your product or service or not. It is a cheap option compared to ‘free samples’, which can be taken advantage of easily. When a subscription business offers a trial period, it can be tracked so that the customer does not consume your service longer than intended. And if it is an online service, it will cost you basically nothing as the subscription business owner.
You might also think that the trial period option to attract customers in the subscription business model might not be that good idea. This is due to situations like, for example, people sharing a Netflix account or creating many accounts just for the trial period. This problem, even though it is prevalent, is avoidable. For example, an educational website called Chegg that receives all the subscription business benefits has stricter checks to ensure that two people do not sign in to the same account.
Things to Consider Before Starting a Subscription Business
By now, you have gained a lot of knowledge regarding the subscription business model. However, you still must be wondering how to start a subscription business from scratch if you are currently on the lookout for a new business venture.
1. The Subscription Box
A subscription box is the main thing every customer will click to sign up for your service, generating revenue for your subscription business. It might seem like an unimportant thing, but your subscription box must be elegant and attractive for your target audience.
Like any other business, you must know exactly who you want to attract to your site when starting a subscription business. Then, you design your website and your campaigns per the appeal of that age group and/or gender. If you make sure to pay special attention to the appeal at your launch, you will be setting yourself up for much higher chances of success in the long run as well.
3. Pricing Strategies
Pricing strategies are of great significance for running a business of any product or service. However, the pricing strategies for a subscription business need to be more innovative, clever, and well thought out. You will have to gather huge amounts of market data through research - qualitative and quantitative - both before deciding on the different prices for the other subscription offers of your business.
Strikingly's Subscription Feature
Strikingly is a website-building platform that has made creating a professional website simpler for numerous individuals and organizations. Our platform is growing in popularity due to the regular updates in features and our user base growth.
Image taken from Strikingly
One of the interesting features of Strikingly is that it allows you to add membership to your website. This means when you build a website on our platform, you can enable your site visitors to register to it, either for free or for a small fee. This means you can run an entire online business based on the subscription business model through your website built with us, as long as you are on our Pro or VIP plan. Even more interesting than that is that you wouldn’t need to hire any costly web developer or programmer to do the job for you. This will save you money and rid you of all the headaches of dealing with a technical person.
Follow these steps and offer a subscription to your website visitors.
Go to your Strikingly editor and click ‘Audience’.
You will see a green button that says ‘Activate Membership’. Click this button.
Choose your preferred registration method. You can make it into either a free registration or a paid subscription membership. You may also select the third option to allow only those to register as members who purchase a product on your site.
Image taken from Strikingly
It’s really as simple as it sounds. Your website will appear like a pro if you activate this subscription business feature. It will give you a competitive edge against the other players in your niche and help you increase your monthly revenues by accepting subscription payments from your users every month.
At Strikingly, we take pride in providing you with a smooth experience of running a professionally built website. We believe that if you can make your business thrive, our objective is fulfilled. The tools available on our platform are developed and designed, keeping our users’ ease in mind.
But to begin with, you can start with our free plan to familiarize yourself with the platform. As you grow your business and update your site, you may upgrade to one of our paid plans to use our more advanced features, such as the one described above. These will help you regulate your sales revenue more efficiently so that you can put your focus on further expansion strategies for the ultimate success of your initiative.