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Discover the Secret to Boosting Recurring Revenue: How Subscriptions Transform Apps

Discover the Secret to Boosting Recurring Revenue: How Subscriptions Transform Apps

Jul 3, 2023


Have you ever wondered how some brands manage to keep their customers coming back for more, month after month? The answer might be simpler than you think: subscriptions. But not just any subscriptions. We're talking about subscriptions seamlessly integrated into their mobile apps.

The Rise of Subscriptions in E-commerce

In the world of e-commerce, subscriptions are no longer just for magazines or software services. They've become a powerful tool for Direct-to-Consumer (DTC) brands to build customer loyalty, predict revenue, and ultimately, scale their businesses. That's why it is important to invest in the right inventory management solution for your business.

According to a report by McKinsey, the subscription e-commerce market has grown by more than 100% percent a year over the past five years. From beauty boxes to meal kits, and yes, even your favorite DTC brands, subscriptions are taking the e-commerce world by storm.

The Benefits of Subscriptions for Shopify DTC Brands

So, why are Shopify subscription apps such a big deal? Well, for starters, they provide a steady stream of recurring revenue. This means that instead of constantly having to find new customers, brands can focus on keeping their existing customers happy. And happy customers are more likely to stick around, leading to higher customer lifetime value (CLTV).

But the benefits of subscriptions don't stop there. 

They also offer a level of predictability that's hard to come by in the often unpredictable world of e-commerce. With subscriptions, brands can forecast their sales more accurately, making it easier to manage inventory, cash flow, and growth.

Evidence: The Power of Subscriptions in Numbers

According to a study by Zuora, subscription businesses grow revenues approximately five times faster than S&P 500 company revenues and U.S. retail sales. This statistic alone paints a clear picture of the potential that lies within the subscription model.

Case Studies: Subscriptions in Action

But let's move beyond the numbers and take a look at some real-world examples.

For example, the success story of Dollar Shave Club, a DTC brand that disrupted the razor industry with its subscription model. By offering a simple, convenient subscription service, Dollar Shave Club was able to carve out a significant market share and was eventually acquired by Unilever for $1 billion.

Another example is BarkBox, a monthly subscription service for dog products. BarkBox found success by combining the subscription model with a strong focus on customer experience. Each box is curated with a unique theme, creating a sense of anticipation and delight for both the dog and the owner. Today, BarkBox boasts over 600,000 active subscribers.

Research on Customer Preferences for Subscriptions

But what do customers think about subscriptions? A study by the Interactive Advertising Bureau found that 90% of consumers subscribe to at least one subscription service. The study also found that consumers appreciate subscriptions for their convenience, novelty, and cost-effectiveness. These examples and statistics underscore the power of subscriptions in the e-commerce landscape. But how can you leverage this model in their mobile apps?

Implementing Subscriptions in Mobile Apps

Now that we've established the importance of subscriptions, let's talk about how to implement them in your mobile app.

Key Features of a Successful Subscription Model

A successful subscription model isn't just about charging customers on a recurring basis. It's about providing real value that keeps customers engaged and coming back for more. Here are some key features to consider:

  1. Personalization: Customers love feeling special. Personalizing your subscription offerings based on customer preferences can go a long way in enhancing customer satisfaction and retention.

  2. Flexibility: Not all customers are the same. Offering flexible subscription options, such as different pricing tiers or the ability to pause or cancel anytime, can cater to a wider range of customer needs.

  3. Seamless User Experience: The subscription process should be as seamless as possible. This means easy sign-up, intuitive management of subscription settings, and clear communication about billing cycles.

Implementing Subscriptions with Tools like Appbrew

But how do you implement these features in your mobile app? That's where tools like Appbrew come in. Appbrew is a no-code mobile app builder that integrates seamlessly with Shopify. It supports all brand store integrations, including subscriptions, making it easy for DTC brands to implement a subscription model in their mobile apps.

With Appbrew, you can create a personalized and flexible subscription experience with a seamless user interface. Plus, you can leverage push notifications to remind customers about their subscription renewals or inform them about new offerings.

Putting Subscriptions to the Test in Your Mobile App

So, you've implemented subscriptions in your mobile app. Now what? It's time to put them to the test.

Setting Up a Trial Subscription Option

One of the best ways to test the effectiveness of subscriptions is by setting up a trial subscription option. This allows customers to experience the benefits of a subscription without making a long-term commitment.

For example, you could offer a 30-day free trial of your subscription service. Monitor how many customers sign up for the trial, how many convert to a paid subscription, and how many stays subscribed after one billing cycle.

Monitoring the Impact of Subscriptions on Sales and Customer Retention

But don't stop at just tracking subscription numbers. Look at how subscriptions are impacting your overall sales and customer retention.

Are customers who subscribe spending more than those who don't? Are they making purchases more frequently? Are they staying customers for longer?

These are all important metrics that can help you understand the true impact of subscriptions on your business.

A/B Testing

You can also consider A/B testing different subscription options to see what works best. For example, you could test different pricing tiers, benefits, or even the wording of your subscription call-to-action.

Remember, the goal is not just to get customers to subscribe, but to provide a subscription service that adds real value and keeps customers coming back for more.

The Future is Subscriptions

As we wrap up our deep dive into the world of subscriptions, one thing is clear: subscriptions are more than just a trend. They're a powerful tool that Shopify DTC brands can leverage to drive customer loyalty, predict revenue, and scale their businesses.

By offering a subscription service that provides real value, brands can transform one-time customers into loyal subscribers. And with tools like Appbrew, implementing a subscription model in your mobile app has never been easier.

But remember, the key to a successful subscription service is continuous testing and optimization. So, don't be afraid to experiment with different subscription options, monitor the impact on your business, and adjust your strategy as needed.

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