Over the past few years, subscriptions have become a major trend in eCommerce. This type of payment became the popular way to shop for consumers during the pandemic, with the average British consumer spending £620 a year on sign-up services alone, according to Barclays.
Therefore this hype presents a great opportunity for companies wanting to create long-term customer relationships and earn regular and consistent income using this business model.
Throughout this short guide, we will cover everything you need to know about subscriptions, how they work, and how you can get started with subscription payments.
Types of subscription businesses
In many cases, businesses will sell products online but will be new to subscriptions. They might be already using an eCommerce provider for specific needs like email, customer service or inventory management.
These businesses will need a subscription payment provider that fits into their larger ecosystem and will help them charge their customers regularly, whether on a monthly, weekly, or yearly basis, for a set product or service.
Therefore, it’s important to find the right balance between your business, your customers, and your unique needs when choosing your subscription model.
There are three types of subscriptions your business could implement:
1. Replenishment subscription
This type of subscription uses recurring payments for providing the same goods on a regular basis to members. An example of a very common replenishment subscription is the Amazon Subscribe & Save example, where customers can save 10-15% of the price of the item with a repeat subscription.
2. Curation subscription
Subscribers to curation subscriptions receive collections of products organised around a certain theme. Beauty and wellness companies have jumped on this bandwagon, offering subscription boxes focus on particular skin issues. A great example of this model is Birchbox, a recurring subscription that sends customers a box with five to six beauty products every month.
3. Access subscription
Last but not least, the access subscription model has proven to be the most popular and profitable during the pandemic for companies offering online services. Subscribers pay for access to discounts, early releases, or gated content through these memberships. Clear examples of this subscription are companies like Netflix and Disney+.
How to choose a subscription payment model
Consider these four factors when comparing solutions for your business:
Integration needs: How does this payment work with your existing system?
Product: How will you provide subscriptions for physical or digital products, and what logistics will be required?
Scalability: How many subscribers do you hope to gain, and by when?
Expertise: What is your level of expertise in eCommerce?
The only thing you need is a reliable payment solution if you have evaluated all your options and decided you are ready to make the switch. At Trust Payments, we strive to make our sellers’ subscription payments as convenient as possible and keep revenue coming in with features like recurring billing, account updating, automatic re-try, and invoicing.
Payment insights for long-term growth
For things to run smoothly in your subscription business over the long run, you need actionable payment insights to help you make smart decisions.
This is where reliable data comes into place. We provide that to our customers using our TRU Insight tool. Designed for both eCommerce and face-to-face businesses, it provides a monthly analysis of all your business’ payment data.
By collecting and analysing your business’ payment raw data, TRU Insight gives you a clear overview of multiple key payment indicators to understand the health of your business at-a-glance, all packaged in visual, easy-to-understand graphs and stats.
Our Dashboards highlight key areas to implement changes and identify anomalies to help rectify challenges, looking at areas such as payments, fraud attempts, chargebacks data, buyer behaviour and segmentation, as well as geography.
It’s very accessible and allows you to log in anytime and from anywhere to view your analytics. Available in a PDF format and easily shareable.
In conclusion
Subscription payments are a rapidly evolving and continuously changing industry. Your business’s success will depend on your ability to move quickly, so choosing the right payment partner is essential to help you adapt to the ongoing changes in this market.
Still confused about how to start subscription payments? Reach out to our Customer Support Team for an in-depth discussion.
