Tag Archives: subscription billing

How To Build And Maintain Your Subscriber List In 2015

sylvester-534233_1280If your subscription business is going to be a success in 2015, it will need to grow and maintain a healthy subscriber list. There are many routes your business can take to achieve this. Some of these are rather simple to undertake and require limited effort; others require greater input but can yield better returns.

So here is the definitive list on how you can build and maintain a subscriber list that will grow your business in 2015.

1. Incorporate A Strong Digital Sales Funnel

During 2014, the amount of goods and services being bought online grew 13.8% in the US and 18.4% worldwide. This makes the potential value in developing a digital marketing strategy highly valuable. Digital marketing channels are not about developing one strong point of contact but about building a process which attracts an audience and then develops a relationship with them from first contact right through to after sales.

The advantages of a digital sales funnel is that not only does it attract new customers but it also allows you to use the power of referral marketing; to spread news of your services to friends and family of current users. The contacts of your best customers are also likely to be highly interested in your services and therefore more liable to become customers.

There are many elements to a strong digital sales funnel, including blogging, social media, email marketing and landing pages.

2. Keep In Contact With Your Subscribers

When you are selling to your target audience you are looking to build trust with your clients. Once you’ve gained their trust and they’ve converted you shouldn’t end your contact there. Email marketing is one of the best options for maintaining contact, but at the same time there are other options. Regular phone calls or dropping into their office (if they are local) are excellent ways to keep those bonds of trust strong.

Try to keep your relationship going with regular meetings but you have to be careful not to overload yourself. So get your diary out and plan time every week to connect with your audience. One of these times might be going to networking events in your local area or signing up to a trade show.

3. Keep Developing Your Product

Businesses throughout the world have failed in the recent decade due to one very specific cause: a lack of adapting their business to new environments.

One of the best examples is the collapse of Blockbusters. The video rental store was once a staple for families in many countries for their Friday and Saturday night entertainment. However, other companies such as Netflix began to offer consumers easier ways to receive rentals, starting with home delivery before moving onto video streaming and then blockbuster’s market share dropped. Eventually they got their business model right and started operating a video streaming service, but it was far too late to break into the market with those who had already established a presence – some of them like Netflix with a subscription model.

Part of the reason for this failure on Blockbuster’s account was to not adopt new digital practices their competitors were using. You can avoid the same, by looking at new ways to deliver your product and ensure you have the market advantage, to attract the customers who are the first adopters.

Conclusion

Your business in 2015 could be one of the best on the subscription market. All you have to do is ensure that you are communicating with your audience and deliver your products to the market in new and innovative ways.

Do you need recurring billing and subscription management software? Contact one of our experts at info@fusebill.com, call or check out the Fusebill free trial.

How A Digital Subscription Model Differs From A Physical One

On balance, what is the difference between physical and digital subscription businesses?

On balance, what is the difference between physical and digital subscription businesses?

One of the most common misconceptions about digital subscription businesses is that their models are very similar to those of physical subscription business. While there are many similarities, there are also significant differences. It is important to understand these differences as it can support you in building your own digital subscription business.

Difference One: Costs

The most obvious difference between the two types of model is cost. A physical product will cost every time it is sent out. In contrast, a digital product only costs when in development. For some online subscription businesses this may mean that the majority of the costs arise before they have a single subscriber. However, if the digital product is continually being improved, costs could be incurred continuously.

This does have several benefits. While cost is not a major factor in the purchasing decision of customers, it does play a small part in grabbing the attention of the target audience. If you consider the example of a sports magazine, the physical subscription model would have to be priced higher because the business would have to consider the costs of producing the magazine and delivering it. However, the digital magazine wouldn’t have the production costs and therefore could offer exactly the same content for far less.

Difference Two: Set-up Time

A physical subscription model has a much lower set up time compared to a digital model. A digital product needs time for the development of the software.

Although there are some set-up processes with a physical model, a physical subscription business could, theoretically, be setup much quicker. This has significant benefits as you would not be losing as much money developing a product without being able to charge for it.

Difference Three: Troubleshooting Is Quicker

When you have physical business and something goes wrong, there is a huge delay in getting it better for your customer. You will need to receive the item back (if it arrived in the first place), then replace the item which could take an entire subscription period and this could be frustrating for your subscribers.

Alternatively, you could forgo the process of replacing the problem item and just return the subscribers money. However, this will still annoy the customer.

With a digital product, your troubleshooting can almost be instant. The customer can phone you up, report the problem and then your technical team can fix the error. This would please your customers and they may publically praise your quick action – gaining you extra brand exposure online.

Difference Four: Instant Access

When a consumer is paying for a physical subscription they often have to wait until the business is in a position to send out the product. Most subscription businesses would have set days and times when the items are to be ready. This could mean that the customer may have to wait a little less than a month before they receive the first item.

In contrast, digital products can be delivered within seconds of the customer paying the first subscription instalment. This instant gratification is very rewarding for the customer and they appreciate it more than having to wait a significant amount of time to receive something they have paid for.

Conclusion

There are many differences between a digital subscription and physical one. While both can be used as learning opportunities for each other, there is a clear benefit to being digitally based rather than physically. Digital subscriptions are more cost effective to start up and offer customer service opportunities that physical models can’t compete with. So when you are starting a subscription business model, think carefully which model is better for you.

Do you need recurring billing and subscription management software? Contact one of our experts at info@fusebill.com, call or check out the Fusebill free trial.

Image courtesy of renjith krishnan at FreeDigitalPhotos.net

5 Tips For Starting A Subscription Program In 2015

Are you looking to achieve a regular and consistent income from your customers? A subscription based business is one of the best ways you can accomplish this.

Running a subscription based business is easy if you set your program up correctly in the first place. So here are five of the best tips to support the start of your subscription business.

1. Start Before You Believe You Are Ready

One of the biggest barriers for businesses and entrepreneurs entering the subscription market is that they don’t believe they have enough content or functions to start. This can be very deflating and can further block you from starting your successful business.

But, you don’t need to have a fully developed product or set of content to start accepting subscription payments. You should look for a minimum viable product instead and offer your ideal customer base an introductory offer. As long as you let them know you are using them as test subjects and will want their feedback, suggestions and criticisms, you should be able to retain key customers and grow your business.

As your product develops or your content grows you can increase your fees and by this point you should have a lot of direction on what your target audience needs.

2. Engage With Your Subscribers

If you really want to succeed with your membership site then you need to grow. One of the best ways to do this is to ensure you are attracting subscribers by word of mouth. This can be achieved more easily when you are interacting with your audience and members on a regular basis.

Interaction can be done through several channels, firstly by email and then perhaps over the telephone, depending on the number of members you have. Another good option is to have conversations over social media, where you can gain more attention for your business because the conversation can be seen by their followers as well as yours.

3. Run Group Events And Challenges

Sometimes it can be hard to gain momentum for your business and while many people would just try to increase their promotional content and perhaps hope for a big break, there is another option for your business: holding a contest / competition.

Competitions are an excellent tool for growing the awareness of your business as people love free stuff. The prize doesn’t need to be expensive as long as it has value to your target audience you will gain some interest in your competition.

Also, don’t stop at just one competition, run another as soon as one has finished.

4. Give Free Subscriptions Out

As previously mentioned, word of mouth is one of the best marketing avenues you can use. There is no better way to generate positive reviews for your product and word of mouth for your brand than giving away subscriptions for free, at least for a trial period.

As like with competitions, the word ‘free’ is very attractive to consumers whether they are individuals or businesses.

5. Don’t Be Too Rigid

Being too stuck on a certain plan isn’t going to do you any good in the long term. You need to be flexible in the look and model that you use to deliver your product. The changes to your business should be user orientated and the alterations can be initiated from conversations you’ve had with your customers.

As you make changes help your customers to navigate around the new product so that they don’t feel alienated by your shift.

Conclusion

Your subscription business can get off to a great start if you strategise it right from the beginning. Use the tips above to help you cut costs, attract customers and grow.

Do you need recurring billing and subscription management software? Contact one of our experts at info@fusebill.com, call or check out the Fusebill free trial.

Image courtesy of digitalart at FreeDigitalPhotos.net

4 Innovative Subscription Business Models

There are many different business models available for entrepreneurs who want to earn money by selling a service or product. The subscription business model is one of those models. Most subscription business models work by the business taking a regular payment from the customer and then giving them access to resources or a computer program for a set period of time.

However, these aren’t the only subscription business models that are available. There are numerous other subscription models that entrepreneurs can use to deliver their services and products. Here are four of the most innovative subscriptions available and what makes them unique.

Personal Styling

Today everyone leads busy lives and time for shopping and self-styling is getting harder to find. For some this can be an excuse for not going shopping too often and this is why the personal stylist has gone online.

Stitch Fix combines e-commerce with the in-store experience of retail shopping and personal styling. They send the customer five items they’ve handpicked for them based on their answers to a lifestyle and fashion questionnaire at the beginning of the subscription.

The customer can then try on the clothes sent and keep only what fits and what they like. Feedback is also passed back to the stylist, so the next box can be tailored to be more in tune with what the customer likes.

Shaving Gear

One of the most popular and recognised subscription services, which is slightly unorthodox, is the Dollar Shave Club. The service promises to deliver blades to the customer’s door for just one dollar a month. There are other options available; but, the service is pretty much the same.

In addition to the blades, each customer gets a free handle and has the option to purchase add-ons such as shaving cream and moisturiser.

The brand entered the market with an incredible advert that broke with tradition and went viral online. Since then, the subscription service has gone from strength to strength and has started new lines and improved customer options.

Kids’ Toys

Box of OMG is probably one of the more unusual subscriptions services available online. Not only do customers not have to pay a subscription to receive anything, but their contents are not guaranteed.

The service works like this: a customer subscribes to the site via email or a social media account and every quarter, the company sends out a limited number of boxes randomly to those on the list (you aren’t guaranteed a box each quarter). Subscribers can increase the chance that they will receive a box by signing up friends, advertising the brand on social media and competing in other activities on the site.

The boxes are full of toys, comics, snacks and other items to keep your children happy.

Travel Clubs

Netjets is probably the most unique business models on this list. For a hefty subscription fee, customers can choose how many hours they wish to fly per month and then reserve that time as a share of the private fleet maintained by the company.

This can be an effective way to reduce travel costs for businesses that travel regularly. The same can be said for public figures.

There are also similar options for cars.

Conclusion

There are a number of options for those looking to start a subscription business. The only barriers to entry are legality and your imagination. Consider how you can convert your business into a subscription business or what new business you would like to start. As recent years have shown, there is a growing demand by customers for this model.

Do you need recurring billing and subscription management software? Contact one of our experts at info@fusebill.com, call or check out the Fusebill free trial.

Image courtesy of imagerymajestic at FreeDigitalPhotos.net

How To Determine What Your Subscription Pricing Should Be

You went into business because you wanted to make a profit. Achieving that goal relies on a couple of key elements. Firstly, that you provide a high quality service your customers will want to use continuously. Secondly, that your subscription service is priced so you are able to make a profit.

Profit is very important because it allows you to enjoy your lifestyle as you like and fuels growth within your business. If you do not charge enough, then you may not have enough income to cover your costs. On the other hand, if you charge too much, your customers may not see the value in your product and leave your business. It will therefore be harder to maintain your income and profits.

So what can you use to help determine your pricing strategy?

1. Your Business Model

The number of clients you are hoping to have at any one time is an important factor. If you plan for a significant number, then you can charge less per customer but you will be limiting the amount of time you can afford each for troubleshooting, customer service, etc.

In contrast, if you want to have a more exclusive club and have few customers, you need to increase your prices but can afford more time per customer. This may be the best option if you have a very niche product or want to create an elite group of clients where you have very close relationships.

2. The Cost-Plus Method

This is a standard way to price services. The first step is to determine the cost of delivering the service to your market. This should include the fixed costs and the variable costs. The fixed costs should be spread out over the number of customers that you are looking to attract and manage in your subscription business.

The most common mistake to make with this method is that while you may pay someone $12 per hour, the costs are more than that. For instance, you may have rent, utilities, insurance, website, taxes, etc to consider.

3. How Much Your Competitors Are Charging

You might also want to look at how much your competitors are charging. There are various ways in which you can determine if their prices are related to yours, and we have covered this previously.

To find out their costs, have a look on their website, speak to their sales team and talk to associates who have dealt with them. This will give you an indication of how the market is reacting to pricing, especially if you have a significant amount of competition whose prices are very similar.

However, you shouldn’t base your prices on just your competitor’s price points. Your product may have a greater value or you could have different costs.

4. The Perceived Value Of Your Service To The Customer

Your customers aren’t going to pay for a service they don’t think is value for money. Therefore, you should ask your customers what they believe the value for your subscription service is. It is likely they will slightly underestimate what you could charge, but it can be a good starting point.

An alternative way of achieving this is to A/B test several price points and see which has the higher conversion rate. At the same time you should look at the customer lifespan; if you find that a higher price has a lower customer conversion rate but higher customer lifetime value – it is obviously the better choice.

Conclusion

Pricing your subscription correctly is an important factor in running your business. Charging too high or too low may cause your business to fail as you will not make enough profit to run your business effectively. Ensure you are charging the right amount to earn enough profit to live comfortably, grow your business and provide a high quality service.

Do you need recurring billing and subscription management software? Contact one of our experts at info@fusebill.com, call or check out the Fusebill free trial.

Image courtesy of Stuart Miles at FreeDigitalPhotos.net

Common Customer Questions About Subscription Programs

The use of the subscription business model is growing. Many businesses see this as a way to offer cost effective, but high quality, services to their customers. As with any business model, there will be some frequently asked questions you customers will want to know the answers for before committing to any of your packages. If you answer these well; then you can increase the sign up for your services.

So what are the common questions and how can you answer them?

How Much Is The Cost Of The Subscription?

This is probably one of the most common questions customers will want to know. Don’t be tempted to send them to your subscription page. Instead, detail the costs of each of your packages, the period (i.e. weekly, monthly, annually) and how payments can be made.

What If I Want To Upgrade / Downgrade My Subscription?

There are a number of different reasons why someone might want to change their package with your business. For instance, they might have an increase in the traffic to their website and need a larger package or they might be downsizing their staff and require less licenses for your software.

Whatever the reason, they are going to want assurances that they can change their package easily and with no heavy costs. Detail carefully how long it takes to make a switch and when new charges will apply from. At the end include a link to making the request for upgrading / downgrading a package.

What If I Want To Cancel My Subscription?

Although many of your customers aren’t going to cancel their subscription in the near future, they are likely to want to know the details encase they want to later on. The information they want will include:

  • What notice do they have to give you?
  • What are the costs for cancellation?
  • When will their access be removed?
  • What happens to any outstanding balance?
  • How do they notify you of their wish to cancel the subscription?

By answering these questions you can demonstrate you are a legitimate company and assure them of your professionalism.

How Are Extra Fees Collected?

This is one of the most important questions if you offer add-on services that can be bought at any time. Customer will want to know whether they are provided an invoice for them to pay separately or whether the funds are taken directly from their account immediately or on the next subscription payment date.

What Does My Subscription Include?

Every customer will want to know what each package gives them access to. However, if you operate a number of different packages, this could become a long answer which many people would not read. Therefore, it is probably best if you describe the basic subscription for your readers and then direct them to your packages page for further information on other packages.

How Can I Contact You?

If you don’t provide this information to your customers they are unlikely to think they cannot contact you if there is a problem with their service. This can potentially deter them from using your services. On every page, and especially the FAQ page, you should include a telephone number and an email address.

What Is The Minimum Contract Length?

Customers want to know they won’t be tied into a long term contract that doesn’t give them flexibility. Therefore, let them know about the minimum term and what will happen if they wish to leave your service before that period has ended.

Conclusion

Your FAQ section on your website is a perfect opportunity to demonstrate your professionalism. Use our guide above to start creating your FAQ list and what to say to your potential customers.

Do you need recurring billing and subscription management software? Contact one of our experts at info@fusebill.com, call or check out the Fusebill free trial.

Image courtesy of Stuart Miles at FreeDigitalPhotos.net

How Often Should You Update Your Subscription Pricing?

There are often times that you will need to update your subscription service prices. The reason for these adjustments might include changes in costs or attempting to reduce / increase demand for your services.

Most clients expect prices to increase over the longer term. This is often due to costs such as new government legislation which has forced you to implement new controls. These costs should be passed on to your customers.

However, there are times when fees can decrease. For example, you might introduce a new sales process or technology within your company that significantly reduces your customer acquisition cost.

In either of the above cases, the costs would change significantly and quickly. It would be fairly easy to know that these are good times to update your pricing strategy. Changing the prices at these times though might make new customers unhappy, especially if they have missed a saving. You might also have unhappy existing customers, who would need to be told carefully about any price change.

Slow Changes In Cost

In most cases, prices changes happen very slowly. You might struggle to know when to update your subscription prices in this case.

There are also logistical problems with changing your prices. The first problem is failing to change your fees quickly enough. Waiting too long can significantly impact your profits.

Likewise, when changing your fees, you might have significant marketing materials advertising old prices. These would need to be changed; which will be expensive.

So how often should you change the prices for your subscription business?

Weekly

This is an extreme frequency to change prices. However, this would allow your business to maintain a good profit margin and suffer limited losses.

If you were to implement a weekly change in the prices, then you would have expensive weekly changes to your physical marketing materials and likely other processes in order to implement the changes.

There could also be issues with your subscription management and customer services. Unless you change all existing customer’s fees at the same time, numerous clients on different payment plans will make it harder for your customer service team. If you did change everyone’s fees, you could anger clients very quickly and lower your retention rate.

Monthly

Monthly might be an option if your suppliers have regular fluctuations in their prices.

Changes at this level are easier to manage but customers may feel unhappy if they cannot rely on a regular monthly price for your services.

Quarterly

Many big brands do reviews based on their previous quarterly results. Changes every three months are easy to implement and limit profit loss.

However, quarterly changes might again prove to be too much for your customers who might complain about your frequent changes. If you wanted to implement quarterly changes, it might be best to consider how you are going to communicate the changes with your clients before you commit to this frequency.

Annual

Annual is often used by small to medium businesses that have a limited new customer generation and rely on the long retention of current clients. Annual is a good way to manage your price strategy and if you inform customers in advance of when you do price reviews, they will be ready for any changes.

Annual changes also allow you to better prepare your customer service team, marketing materials and other requirements needed to implement the changes.

Conclusion

Changing the price for your subscription service is not a decision to be taken lightly. How often you make those changes can have a significant impact on your business and its clients. Ensure you are doing it right by considering the costs of changing your subscription fees.

Do you need recurring billing and subscription management software? Contact one of our experts at info@fusebill.com, call or check out the Fusebill free trial.

Image courtesy of jscreationzs at FreeDigitalPhotos.net