5 tips for maintaining customer subscriptions

From streaming that new Game of Thrones spinoff and getting your weekly fresh fruit and veg delivered to staying fit with a simple app – there seems to be a subscription for everything we need or do these days. The subscription e-commerce market has grown more than 100% per year over the last five years. Initially fueled by start-ups, today established brands are using subscription-based loyalty programs to increase customer retention.

The idea is simple: rather than sell products or services individually, a subscription offers regular access to them – whether monthly, seasonally or anytime. This way, a one-off buyer can quickly become a regular customer. And for brands that do them right, subscriptions are paying off. A 2020 McKinsey survey found that customers are 60% more likely to spend more after subscribing to a paid loyalty program. They’re also more likely to buy more frequently and to choose that brand over competitors.

But the success of a subscription model doesn’t just depend on a customer signing on the dotted line, as Netflix realised recently. In the first half of FY2022, the streaming giant lost 1.2 million subscribers as streaming wars heat up.

So why do customers cancel subscriptions? And what can you as a marketer do to convince them to stay?

2. Enable personalisation and flexibility

Personalisation will be the single most important discipline in the next decade, according to Philip.

“The brands that manage to deliver omnichannel personalisation are the ones that will win over the next decade.”

Robust loyalty programs allow you to collect the right information you need to create truly personalised experiences across all channels – including your subscription program.

Make sure customers receive relevant and timely offers and can customise their subscription to suit their needs. Whether that’s around payment types, subscription tier options (from free to premium) or order frequency.

HelloFresh allows customers to pause their subscriptions any time, for instance, rather than locking them in to weekly or monthly orders. This gives customers the flexibility to maximise the value of their subscription – ordering for the busy periods, and pausing when they have more time to prepare for the week ahead.

3. Be clear about pricing and billing

There’s nothing pleasant about an unexpected charge on your credit card. And it can turn customers off your product or service for good.

A simple way to avoid this is to make sure pricing options, billing frequency and the renewal terms of your subscriptions are simple and clear – and letting customers know when you’re about to charge their account. Send a quick email before a customer’s subscription is about to renew, including when and how much they can expect to be charged.

This will avoid nasty billing surprises.

5. Raise value when you need to raise prices

There are times when you will need to raise the prices of your product or service subscription or introduce new tiers.

This can be tricky to navigate, as paying more for the same thing can make your customers feel ripped off. One way to manage your customers’ experience is by communicating added value they will receive. Whether that’s extra rewards, improved customer service or a wider range of products or services, make sure you back up your price increase with extra benefits.

Create an effective loyalty program for your brand

Learn from Philip Shelper in ADMA’s Loyalty Programs and Consumer Engagement course. Enrol today.