3 Tips to Elevate Subscription-Based Business Using Social Media
Recurring revenue models were once a phenomenon reserved for cable television and insurance firms, but will soon become a necessity for all businesses that want to compete in their respective industries.
49 percent of U.S. businesses either already offer some sort of recurring revenue product, or are in the process of developing one, according to a 2012 study by San Francisco-based software company Aria and Incyte Group. Technology research firm Gartner predicted in its 2011 report “Building A Strategy For The Subscription Economy” that 35 percent of non-media companies listed on the Forbes Global 2000 list will generate upwards of 10 percent of their income that year via subscription-based revenue models.
The software-as-a-service (SaaS) model has revolutionized the way software companies generate revenue, but it’s not limited to technology firms. Ingersoll Rand, a 140-plus-year-old conglomerate known mostly for manufacturing tools, now offers security systems that require a monthly monitoring fee to operate. Large firms like Ingersoll have the means to utilize multiple channels to promote their products. But social media is the best friend of smaller firms wanting to get the word out about their products and increase revenues using a subscription model.
Discounts For Signing Up
Social media has changed the way people interact with one another, and how businesses communicate with their customers. One thing that has not changed is the fact consumers are always looking for a good deal. Businesses use social media to build customer trust and loyalty, but these platforms can also boost your bottom line.
One way to do this is by offering exclusive deals for those who sign up for recurring billing. A vitamin company, for instance, can offer a 5 percent discount for those who get a new 30-day supply delivered to them each month. Promote the offer on your Facebook, Google+, and Twitter pages and provide a link for customers to click. Chargify, recurring billing platform of choice for companies like Inc. Magazine and News Corp Australia, will automatically apply the coupons for the discount and subsequently continue billing the customer based on the intervals you choose.
Many customers like the convenience of recurring billing anyway. A 2005 survey by Mastercard found that half of participants would consider taking their business elsewhere, with all other factors being equal, if the new provider had recurring billing. Its a win-win for the company and customer, as the previous is assured of revenue every month, while the latter gets their product every month at a reduced price.
Publishers are particularly vulnerable to technological advances of the 21st century. A 2012 study by PricewaterhouseCoopers (PwC) found that an astounding 90 percent of all online advertising revenues go to the top 50 publishers (i.e. Huffington Post, TMZ, etc.). The solution for smaller outfits is to offer premium content.
Keep in mind, customers are not going to pay for elementary content they can get for free elsewhere. The content must be entertaining, timely, informative, actionable, and priced right. Most people have no problem paying for a year of good content if it cost them the same amount as a large cup of coffee at one of those pricey java outfits.
Promote your blog posts on social media with the first few sentences of the respective post. When readers click-thru, they’ll be able to read a few more sentences but be prompted to pay an annual recurring fee of $5 or less to get full access to premium content. Remember, never take anything away from loyal customers that was free before. Premium content should be something new, unique, and beyond the normal content your customers are used to seeing.
Sense Of Urgency
Humans naturally seek out things that are pleasurable and avoid anything that causes pain. When customers see tangible results due to your product or service, they will want to experience that pleasure quickly and efficiently.
Barbers and hair stylists, for instance, can post photographs of recent customers that display high maintenance, en vogue styles. Offer regular clients a small discount for signing up for recurring payments and sticking to the same appointment times each month. Landscaping firms can create urgency by reminding homeowners of HOA fines for improperly groomed lawns or by showing graphic photos resulting from high grass (snakes, insects, etc.).
Companies that are not equipped for success in this new world of recurring billing risk being left behind. Its clear the shift is already occurring. Now is the time to jump on board.
Executionists can help you maximize your subscription-based product or service. Fill out our inquiry form or call us today for a free consultation.