Can you satisfy your customers' appetite for subscriptions?

How retailers can go from one-time sales to satisfying your customers’ subscription addiction

June 20, 2019



There’s seemingly a subscription service for everything under the sun.

Want a monthly dose of bacon, bagels or bubble gum delivered to your door? No problem, there are subscriptions for that.

Maybe you need a regular shipment of snow or slime? You’re in luck there too.

It doesn’t matter whether they’re niche or mainstream, subscriptions are scaling fast. From the usual suspects in music and video streaming, to the trailblazers in furniture, beauty and fashion – the model is soaring.

In fact eCommerce subscriptions recorded 100% annual growth in the five years up to 2018.

More exciting still for retailers, there’s still plenty of scope for growth.

In a recent First Insight survey 25% of respondents said they already signed up to a subscription box. But it’s the 32% of respondents who plan to subscribe in the next six months that should be rousing retailers still only focusing on one-time sales.

The race is on to cater for consumers’ subscription addiction. But, for the majority of retailers, adding a subscription service alongside your one-time sales isn’t as simple as flicking a switch.

In this blog we’ll look at what the subscriptions boom means for you, before exploring the challenges in meeting customers’ subscription expectations and the technology that can help you do this.

Why are subscription models booming?

Subscription services have taken off with consumers because they satisfy a lot of our base buying desires.

We all value our time and money, crave more convenience and flexibility, and want to get our hands on the latest products.

On top of this, our inner-child is undeniably excited to open up a personalized box of our favorite stuff every month. (Can’t miss out on that new slime!)

But it’s not a one way street.

From a retailer’s perspective subscriptions offer plenty of benefits too.

They can provide you recurring revenue, consistent forecasting and spread demand throughout the year. More importantly, in today’s market, subscription models serve up consistent website traffic and continuous customer engagement, helping to build customer loyalty.

Subscriptions – signifying the shift in power from retailer to consumer?

So, in many aspects, subscriptions are win-win.

But, on a deeper level, the rise in subscription models is a good barometer for the shift in the balance of power from retailers to consumers. The move to an ongoing sale sees retailers acknowledging that long-term success lies in loyalty built from continually excellent customer experiences, not one off sales.

It’s not that consumers specifically like subscriptions – they like the experience they get from them. And that’s the salient point, even if subscription sales aren’t right for you.

As a result, savvy retailers are moving on from the ship and forget mindset to a mantra of continuous customer engagement. They’re putting the customer first.

Subscription services are a smart stepping stone to embedding yourself in your customer’s daily life. A way to get to know them – to understand their likes and dislikes. And it’s this knowledge that helps you tailor your offering to increase long-term customer satisfaction and, by extension, customer lifetime value.

But, serving up a continuous personalized experience is a big step change if you’re set up for a traditional linear sales model.

Let’s have a quick look at why it’s a struggle for many retailers.

Challenges moving from one-time sales to subscriptions

By their very nature subscriptions have a number of variables.

You have to consider the likes of contract length, pricing, users and discounts.

And when your customer’s needs change, you have to adapt to meet them.

This two-way relationship means that in subscription sales, post-purchase amendments are the norm – whether it’s adding, deleting or modifying orders.

The vast majority of retailers’ systems don’t have the smarts or flexibility to handle these variables in real-time. Especially not in a scalable or efficient way.

Instead, to solve this problem, many retailers create SKUs to handle every possible permutation. This inevitably leads to product proliferation and breeds complexity across sales and delivery – muddying the customer experience.

We’ve covered the importance that personalized, end-to-end experiences play in subscriptions success. But fragmented technology systems build walls between your data, leading to an interrupted view of customers and key commercial information. This makes it impossible to provide the sparkling personalized experience your customers want.

These challenges mean Gartner predict that while 75% of organizations selling direct to consumers will offer subscription services by 2023, only 20% will succeed in increasing customer retention.

So, what are the expectations you need to satisfy to win your customers over?

Customers’ subscription expectations

By catering to each individual’s needs, the best subscription services are raising the customer experience (cx) bar that’s already been rocketed to lofty heights by digital-native retailers.

As always, customer expectations have risen proportionately. Now the best experience available is table stakes.

These sky-high expectations mean if subscribers don’t get an amazing end-to-end experience, they’ll be hitting unsubscribe.

So what do customers actually want?

Along with satisfying the base buying desires we touched on earlier, subscription success is closely linked to a personalized service.

In a McKinsey study, 28% of people said a personalized experience was the top reason to continue subscribing. Continuous speed and accuracy, for the entirety of the customer lifecycle, are also prerequisites for a winning cx.

Armed with this information, the capabilities you require as your foundation for subscription sales are crystal clear.

You need to be able to quickly grasp your customer’s preferences and personalize accordingly. While the ability to engage in real-time, collate data and make quick changes to your service will be key to building relationships and ongoing customer loyalty.

But this is only possible with the right technology.

Technology priorities for subscription sales

In the communications and media industries subscriptions have been commonplace for years.

Familiarity with these services has bred an assumption that selling through subscriptions is simple. In reality, over time, media and communications organizations have either developed or acquired mature technologies to deal with their complex ongoing sales.  

And we can take a few lessons from their choices to prescribe the essential tech features you should prioritize for subscription sales.

A single view of customer & commercial data

First, it’s vital to find a platform that bridges your front-end experience and your customer and commercial info. From there you can pool your data and get a single view of both your customers and commercials. It’s this 360-degree view that’s the basis for providing a slick personalized experience with the right recommendations and tailored customer service.

Empower your people with smart tech

But it’s no use just gathering your data. To execute a fast, accurate and tailored cx you need to make it easy for your people to use the information. This relies on finding tech that uses the likes of guided selling, automation, machine learning and AI to help you personalize at scale.

Flexibility = a seamless cx

With the inherent variables of subscriptions, you need technology flexible enough to easily move, adjust, change or delete orders. While it’s not flashy, flexibility is essential to keep your cx seamless after every customer’s order.

Connect key business processes

To deliver on your customer promise, you need a platform that can connect these capabilities across marketing, sales, fulfilment and customer service. That way you can provide the right products and customer service, at the right time, for the entirety of your customer lifecycle.

As we’ve seen, it’s this end-to-end experience that keeps customers coming back for more and sets you up for long-term success.

By finding a technology solution that covers off the bases we’ve touched on, you’ll give your business the opportunity to find the subscription sweet spot – where customer loyalty, lifetime value and revenues rise.

With CloudSense & Salesforce Commerce Cloud, retailers can quickly and easily start selling through subscriptions, check out our solution overview to find out more.

Commerce Cloud Solution Overview