25-10-2024

How do you retain subscription customers?

Gym memberships, Netflix, phone plans, bike leasing, cloud storage, meal kits, even fridges and razors — today, almost any product or service can be offered as a subscription. Consumers love the convenience: sign up once and you’re all set. For businesses, the subscription model means a continuous customer relationship and steady revenue stream. That is — if customers actually stick around. And that’s not a given. So what does it take to retain subscribers? These 4 key factors make all the difference.

 

When it comes to customer experience, a subscription model is not all that different from a traditional sale. Customers want value for money, a product or service that fits their needs, and smooth, personal service. If you miss the mark on any of those, churn will increase — no matter how attractive the subscription itself may seem.

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1. A value proposition that delivers

Customer retention starts with a solid value proposition. That means being clear about what your offer includes — and making sure your product or service is worth the subscription fee. Is that always the case? Not necessarily. Some subscribers stick around simply because they forgot to cancel. That might sound like a win, but there’s a hidden risk: these “sleeping” customers can wake up one day and cancel en masse, creating a sudden drop in revenue. And let’s be honest — how satisfied can you really be with customers who forgot they were customers?

 

2. Offer flexibility and choice

Your offer should match the customer’s needs. That’s why offering a variety of subscription options is key. Telecom providers do this well — offering a full menu of flexible plans and add-ons. But this approach works in any industry. Think of a streaming service offering a one-month mini-subscription, just to watch one specific show. Any product or service can be packaged in tiers — more features, more value, higher price. Let customers choose what fits them best.

 

3. Speak your customer’s language

When your offer aligns with what customers need, they stay engaged. They build a connection with your brand — especially when you show that you *get* who they are. Use customer insights to tailor your offerings and speak their language. Subscription models are ideal for collecting meaningful data about customer behaviour and preferences. Use that data to personalise your communication and your product journey.

 

4. Make payment part of the convenience

A big part of the appeal of subscriptions is the convenience. That includes the product — but also the payment process. If paying becomes a hassle each month, the appeal fades fast. Give customers flexibility and control. For example, let them choose their preferred billing date in their online account, within a certain window. That reduces failed payments and makes life easier. Put customers in control. Tailor the reminder process to their needs and tone of voice — even in payment follow-ups.

 

A subscription model only works when the offer matches the customer’s expectations — and when service and handling are smooth and effortless. As your payment partner, we support all types of subscription models. We handle the entire financial process for recurring payments — from onboarding to upgrades and reminders. And thanks to our experience in this space, we’re happy to advise you on how to turn subscribers into loyal customers.

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Successful in the Subscription Economy

The popularity of revenue models based on recurring payments is quite understandable: subscribers provide recurring revenue and stable sales. Still, the question keeps circulating in the boardroom: how to implement this new business model in practice?

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