They sneak up on people. One or two subscriptions turn into five or six, and before long, people look at their transactions and realize that they have too many subscriptions paid for every month. If the money gets tight, and even when it is not, consumers feel pressure to cancel subscriptions they are not using or enjoying. This concept is called “subscription fatigue,” and it can make or break any subscription-based business.
Fortunately, there is a way out. With these tips, companies can find the right strategy to build long-term customer relationships based on trust, loyalty, and value.
Rethink the Subscription Model
Although many companies are incorporating subscriptions into their business models, it does not work for everyone. Subscriptions work well for services that people use frequently or for products that consumers buy on a regular basis. They are less likely to provide a great return on investment for products or services that people rarely need. To determine if the subscription model is working, businesses should think about the value proposition. If customers are likely to cancel the subscription after a month or two, it needs further evaluation.
Streamline Branding
Businesses often look at subscriptions as an extension of their branding strategy, whether or not it actually fits. A survey revealed that most brand managers think consistent branding is important, but 77% struggle with off-brand content. Ideally, companies have a consistent brand across all channels, including sites, stores, social media, and subscriptions. The subscription should meet all terms of the brand strategy, including voice, tone, mission, and value proposition. Customers need to feel like the subscription fits with their overall opinion of the brand, or otherwise, they may be tempted to cancel.
Consider a New Pricing Strategy
Subscription fatigue can come from excessively high prices, but more often it is a factor of poor pricing strategy. The idea that subscriptions cost too much is an oversimplification, when subscribers might be more frustrated with the billing process or the value they get from it. Different pricing models may help, including:
• Dynamic Pricing: Adjusting prices based on demand or inventory
• Usage-Based: Charging subscribers only for the services they use
• Freemiums: Free access to basic services, with incentives to upgrade to a better service
• Tiered Pricing: Unique pricing tiers based on the customer’s volume
• Unbundling: Breaking bundled products and services into distinct subscriptions that cost less
Adjusting the pricing model may also assist in securing new subscriptions to minimize the effects of customer churn.
Turn Loyalty Into Benefits
Regular subscribers can be some of the most loyal customers, and they want to feel like that matters to the business. Companies that offer discounts to new subscribers should also offer perks to people who stick with them month after month. Loyalty programs, especially those involving early access, discounts, or credits, can reinforce the benefits of the subscription. Referral rewards can get happy customers talking to their friends and family members, which could lead to new subscriptions and an increase in positive brand recognition. These programs can be highly beneficial, as long as they provide useful advantages to the subscriber and maintain value over time.
Evaluate Customer Feedback
Ultimately, the customers are the best determiners of the success of a subscription model. As such, businesses should seek customer feedback before making significant changes. Customers often want the ability to customize their use of a subscription, without having to make a call or visit a store to make changes. Asking specific questions can help to identify problems with the arrangement, such as accidental overcharges or a lack of communication about rising prices. The use of expert subscription billing software can streamline the billing and payment process, so customers know what to expect each month.
Any company with a subscription model has to deal with occasional subscription fatigue. By employing new pricing strategies and building the program around customer needs, businesses can provide a path to greater success in their subscription programs.
Matt Ream is the Director of Product Marketing at BillingPlatform. With extensive experience in product marketing, particularly for B2B SaaS companies, Ream has a proven track record of establishing robust marketing foundations and positioning products as industry leaders.
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