Subscription services have become popular because they allow customers to receive products they like on a regular basis and enable businesses to maintain a steady stream of revenue. If companies consistently provide products that customers want and value, subscribers will remain loyal and continue to pay for products. This, in turn, will lead to higher revenue for the company than it would earn if customers simply chose to make occasional purchases.
If you plan to launch a subscription service in 2019, setting prices appropriately will be critical. You will need to think about your immediate and long-term goals and create a strategy to meet both and to set your company on the path toward growth and sustainability.
How to Set Prices and Attract Customers
You will need to consider the needs and values of your customers. They will most likely not be a monolithic group, but rather will fall into several categories. Some customers will want a wide variety of products, while others will prefer to keep things simple. To be successful, your company will have to identify the specific needs of various groups and offer several plans or levels of membership at various price points so there will be something to appeal to everyone.
In many cases, particularly with relatively new companies, potential customers don’t know much about business and are unsure about the quality of their products and customer service. One way to help people gather more information and form a favorable opinion is to allow them to try out a company’s basic services for free and offer them additional options for a price. A freemium model encourages people to take a chance on a company and often leads to satisfied customers who purchase additional products or services and maintain their memberships for years.
Subscription companies become more successful and profitable when they grow and adapt to the needs and suggestions of their customers. If you decide to offer new products because your customers request them or because you think they would appreciate them, you will have to adjust your pricing model accordingly. You might decide to include a new product in all subscriptions and raise prices across the board, or you could offer an extra product as an add-on or create a new package.
Make Recurring Payment Processing Easy
Once you have set the pricing guidelines for your subscription service, you will need to make sure that it is easy for customers to sign up and those recurring payments will be processed efficiently and correctly. Subscription DNA makes that simple so you can focus on running your business and meeting the needs of your customers.
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