It’s a fact, nothing in life is static. We have to change and adapt our way of thinking and strategic planning constantly, to stay ahead of competitors. An example of our ever-changing lives is the different economic structures we move through. The rise of the on-demand economy has forced us to review our accessibility to consumers. Now, we are moving into yet another economic sphere – the subscription economy.
So, what is the subscription economy, you ask?
More and more people are re-evaluating their consumerist behaviour, moving away from owning products and focussing more on the relationship they have with a company. They are looking for flexibility with regard to the products they receive, such as My Chocolate Box (a box filled with new chocolate products every month), and when to use it, such as GetMore (Cell C’s customer benefits programme).
These types of programmes must also offer a new payment structure, for instance, pay as you go, a monthly subscription fee or a long-term contract, giving the consumer more choice and flexibility. “80% of companies are seeing a change in how their customers want to access and pay for goods and services,” the Economist noted.
Moreover, companies need to concentrate on their customer relationships, keeping it engaging and personal across multiple channels. We, at NEXT Solutions, do extensive research on the target market when we’re approached by a brand, so that our agents understand exactly how to interact with clients, ensuring the ultimate subscriber experience and that long-term relationships are established. It’s important to note that not only do we focus on the preferred communication channel, but also on the tonality of the conversation – the days of the one-size-fits-all approach are over.
Companies need to adjust their structures, culture and processes to put the consumer first. And in order to create a successful business plan, they have to understand what their capabilities are as well as those of their customers. They need to indicate how many consumers they can address, acquire, retain and what their revenue per person will be. Companies should use all available data to understand the needs of their subscribers, and whether they should upsell or downsell subscriptions. When too much focus is placed on the product, businesses tend to try to upsell without considering their customer’s needs or wants, which can lead to them, ultimately, losing subscriptions.
Thus, to answer the question “what is the subscription economy” – it is the movement from focusing on the product as the centre of the business plan to focussing on the transaction. Customer relations need to be the centre of the business plan.
Just as the on-demand economy has forced companies to review their availability and UX, just so the subscription economy is demanding ease, flexibility and improved relationships. Contact NEXT Solutions today for assistance in answering your clients’ needs in a manner that prefer. Phone 011 449 7045 today.
Information source: Forbes and Zuora Inc.