Recent research by Royal Mail predicted that the subscription box market will be worth £1 billion by 2022. This new trend in retail has blown up in the past couple of years, with the likes of Birchbox and Glossybox finding huge success in the market. And, it’s not only beauty brands who are taking a slice of the action. DeskBeers, Hubble Contacts, Pact Coffee, Graze and HelloFresh are all becoming household names.
This week was the eCommerce Master Plan Virtual Summit, and the focus was subscriptions. In a three-day online event, over ten industry experts shared their knowledge on how to build and grow a successful subscription ecommerce business, including yours truly, LoyaltyLion. The purpose of the summit was to help merchants understand this trend in ecommerce and what to do to make your subscription business a success.
Subscriptions are one of the most exciting areas of ecommerce currently. The possibilities and opportunities in this market are huge and continuing to grow.
Subscription ecommerce is very different from normal ecommerce. Like all new trends, you must ask who, why and what? Who is the target audience involved in the trend? Why are they choosing to spend this way? And, what can you change to suit this trend and make it a success?
There are many challenges involved in cracking this new ecommerce trend. The summit explored the differences and challenges surrounding subscription ecommerce and how to make the most of them to build and grow your business.
Subscriptions are great for stores experiencing fast-growth with a high purchase frequency and looking to improve their customer retention rates. Proving how subscriptions and loyalty programs can work together to generate ROI. So, when the opportunity came up to get involved with this summit, we jumped on board.
LoyaltyLion sponsored the event and our Head of Marketing, Fiona Stevens, presented a session called Loyalty + Subscriptions: another piece of the retention puzzle.
In her presentation, she explained the following:
Here’s a little overview in case you missed it:
Ecommerce is a tricky business. The market is growing 13% every year – that’s faster than almost every other industry out there.
As a result, retailers are faced with the challenge of how to replicate the personal shopping experience online. Gone are the days of the little black book and the friendly human helper who remembers your name and dress size. Instead, we choose to engage with faceless digital platforms. Yes, it is easier for customers to shop from their own home. But this makes it harder for merchants to provide a personal customer experience.
It is also harder to stand out from the crowd. Digital advertising is perceived as the way forward. But with only 9% of digital ads being viewed for more than one second, costly acquisition strategies can easily flounder.
As well as this, competition is fierce. Customers automatically expect great prices, logistics and customer experiences from merchants. So, if one supplier starts doing same-day delivery, it is expected that all of its competitors do the same.
Ecommerce is a challenging business today, but certainly not impossible. There are a lot of actions merchants can take to seize the opportunity and turning to loyalty strategies is a great place to start.
So you’ve acquired one-time customers. But how do you get them over the line to become a long-term subscriber? There are three keys ways to achieve this.
The first way could be to create a subscriber tier in your loyalty platform; this would be a special tier for subscribers where they can get extra perks and benefits for subscribing. Dr Axe’s subscribers get 15% off subscription orders and double rewards.
Another way to get more from your subscribers is to stay in touch between subscriptions with personalised emails. According to Forbes, 28% of subscribers say that personalised experiences are key to ongoing subscriptions. By offering an experience that’s specific and tailored, you’ll ensure that your customers will keep returning.
And lastly, a great tactic to engage future subscribers is to use customer advocacy. Customers who are recommended a company by friends or family are four times more likely to purchase your product. Using your brand advocates to vouch for your company is encouraging for potential subscribers. A great way to do this is to use your loyalty program to drive referrals and social media engagements.
Subscription ecommerce is a booming industry but a tricky one to master. There are lots of different factors that go into a successful subscription business, and loyalty programs could be one of them.
eCommerce Master Plan’s Virtual Summit was a huge success in helping to crack the code and also shared lots of valuable industry knowledge.
By signing up, you agree to our terms and conditions.