According to Telecoming’s SUBSCRONOMICS 2021 report, there are approximately 7.2 million active subscriptions in South Africa and there is a growth rate of 14% year on year. This means that the subscription-based economic model could exceed 820 million by 2025 in South Africa. Wondering how your subscription-based business can be part of this growth then we first need to understand how your business is doing.
Understand where you are.
As with any growth plan, we need to understand where we are so we can plan a growth strategy. What data do you have about your subscription business?
Firstly, we need to understand how our subscribers interact with our webpage and who they are. You can get some of this information from Google analytics and you can look at heatmaps using HotJar to see where people spend time on your website.
Next, you need to look at the following key performance indexes (KPIs) for your subscription business:
- Churn rate: This looks at the rate at which customers stop doing business with you. You calculate it by looking at how many customers you had at the start of the month and then how many customers you had at the end of the month. If this number is low that is good. If the number is high you will need to re-evaluate your business and see where the loss is coming from.
- Average revenue per subscriber: This looks at the average amount of revenue you make per customer for a certain period.
- Customer acquisition value: This KPI looks at the cost of getting a customer.
- Customer lifetime value: This metric considers the value of the customer for the period that they are a customer in your business.
With this information, we can consider five ways to grow your business
1. Tweak your email strategy
You may have your email newsletter tweaked with interesting content that keeps the customer engaged but what do your lifecycle emails look like? Consider the emails you send when your customer joins your subscription, when there is a problem with their payments, or emails where you show what else you offer that may be of interest to your customers. It is important that all the email communication you have is branded and shares the same voice.
2. Develop a strong customer relationship
We are all on the hunt for the best. Finding new customers and bringing them on board is exciting but your efforts shouldn’t stop there. You should continue to invest in your brand’s relationship with your customer. Send them gifts on their birthday. Be there for them when they struggle with your product, and help build trust in your brand. When you have a strong relationship with your customer, then it will take a lot for them to change. So focus on creating a strong healthy relationship with your customers.
3. Look at pricing
Is your pricing in line with your competitors? Do you offer great value to your clients? Use A/B testing of prices to see how price sensitive your customers are. If it is possible offer discounts on annual subscriptions. Another avenue to look at is what is your client’s favourite way to pay online. When you get the results ensure you offer two or more payment options to your client.
3. Review your offering
Have you been receiving customer complaints lately? Is there a common thread in the complaint? Then it may be time to review your offering. Check that your offering is in line with the needs of your customer. You may also look at ways you can upgrade or cross-sell your offering with other products that you sell.
4. Collaborate with other suppliers
Especially if you have a good subscription list, you could contact other suppliers who have products in line with what you offer. By offering them great exposure to your list, they may offer you a discount on the bulk quantity that you would purchase for your offering.
5. Revamp your website
Create content which helps to position you as a thought leader in your industry. Pay special attention to the information your customers want to know about. Next, ensure that your website is easy to navigate. Let the call-to-action buttons be visible. Ensure that the information about your different subscription tiers is easy to understand.
By working through the five ways above you will be able to watch your subscription business grow exponentially.
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