Already very present on media and online training business models, The paid monthly subscription (“subscription model” with a unique formula or with different levels of members) is increasingly being used by various retail & e-commerce players... to name but a few!
The most visible sector in this respect is undoubtedly that of retail chains: Monoprix has launched Monopflix, Carrefour is deploying Carrefour +, Casino Max is also present on the market...
That being said, other sectors are studying this model in a more unexpected way: this is the case in particular with hotels. CitizenM, who have launched a paid monthly subscription allowing their regular customers to benefit from preferential rates and guaranteed advantages.
After unlimited movie cards, subscriptions to the gym, telephone or even to a streaming or music service, consumers have become familiar with this type of payment... provided, of course, that they can find what they want!
This complements the subscription offers in the form of “boxes” received regularly, which e-commerce sites in beauty, wine, experiences or even DIY had already popularized.
A few figures to find your way around
According to statistics relayed by the Natio e-commerce websiten,”the majority (61%) of young people aged 18 to 25 are ready to consume more products and services by subscription” and”80% of consumers are looking for new ways to consume”
Most recent surveys suggest that this form of customer loyalty is one of the pillars of tomorrow's commerce. According to Gartner, for example, the subscription model is one of the main elements that will impact the future of e-commerce. From here 2023, 75% of organizations that sell directly to consumers will offer subscription services.
Why integrate subscription into your strategy?
There is no shortage of benefits:
- A higher customer retention rate
We say it over and over again: Acquiring a new customer is good. Bringing it back is essential to generate growth in the medium and long term..
Note: it is not for nothing that Marketing Studio 360 allows you to visualize which levers and campaigns generate more LTV customers in order to better reallocate your budgets in this sense!
The subscription model allows you to act on new and old customers, better understand their preferences and habits and above all create a priority buying reflex with your brand in their minds.
To return to the examples mentioned at the beginning of the article, a Monoprix subscriber will be less likely to think of Auchan when shopping, and a citizenM subscriber will first look for this hotel chain in the city where he intends to stay before looking at the rest of the market.
The key: stability, loyalty and increased consumer knowledge.
- Better visibility on future activity
Subscribing increases predictability and reduces uncertainty, both in terms of regular orders and in managing the replenishment of your inventory.
It also allows you, if you are in charge of the acquisition, to better measure and report on the value of a customer who is often dearly acquired.
Why do consumers subscribe?
Of course, this depends on the sector, but McKinsey (yes, we know...) noted the following points:
Acquire, upsell, measure: what now?
Whether you are looking to retain your “one shot” customers via traditional techniques or a paid subscription, taking into account their value and acquisition cost should be at the top of your analysis of your campaigns and levers.
Marketing Studio 360 by Alphalyr allows you, among other things, to measure the LTV of your customers (sometimes with a few surprises!) depending on the campaigns, levers and associated acquisition costs.
Make an appointment now for a demo, we will be happy to show you how the platform works and what you can optimize!
