Guest Column | August 8, 2022

The Roadmap To Retaining Loyal Subscribers While Convincing Skeptical Shoppers

By Meyar Sheik, Kibo


When it comes to retailer subscription services, consumers are split on their opinions. Some shoppers appreciate the convenience of subscriptions, while others worry that subscriptions limit their purchasing control.

In fact, our recent consumer survey found that 36% of U.S. shoppers have at least one product subscription in the verticals of health and wellness, food and beverage, beauty and personal care, and pet care. Of the 64% of consumers without a subscription, they cited lack of control and lack of perceived value as their top reasons for not using a subscription experience.

Yet, for retailers, the value is clear. In this article, we’ll explore how consumers and retailers benefit from a product subscription service and best practices for implementing a subscription solution to convert even the most hesitant shoppers.

5 Ways Retailers Benefit From Offering Product Subscriptions

The subscription business model offers retailers various benefits that can set them up for long-term success. The benefits for retailers include:

  1. Consistent revenue streams: Unlike one-time purchases, subscriptions allow retailers to generate a predictable revenue stream.
  2. A growing pool of customer data: Subscriptions give retailers critical insights into shopping trends that can feed product innovation and optimization programs.
  3. Branded end-to-end fulfillment processes: From branded email order updates to thoughtfully designed packages, the subscription fulfillment process provides an immersive experience that delights customers.
  4. The ability to forecast inventory needs: Subscriptions help retailers better predict supply and demand for products and forecast how much inventory they need to fulfill orders.
  5. Reduced customer acquisition costs: By implementing a seamless subscription experience, retailers can build customer loyalty and leverage the brand’s biggest fans to attract new customers through word of mouth and customer reviews.

5 Ways Shoppers Benefit From Product Subscriptions

Retailers aren’t the only ones reaping the benefits of subscriptions. Our consumer survey revealed what attracts shoppers to product subscriptions, including:

  1. The convenience. No more running to the store each time an item is needed. By signing up online for a product subscription, shoppers can have the item show up at their doorstep on a scheduled, recurring basis without ever leaving their homes.
  2. It saves them money. To entice shoppers to subscribe to products on a retailer’s eCommerce site, many offer discounts for a customer’s first order and each recurring order. Especially as the country prepares for a potential recession, consumers will be seeking the best possible deals on everyday items.
  3. Subscriptions allow shoppers to try new products. Curated boxes allow shoppers to try new products regularly before committing to a larger purchase.
  4. Shoppers don’t have to worry about running out of a particular product. By ‘setting it and forgetting it,’ customers can customize subscription order frequency based on their exact needs, ensuring they never run out of their favorite products.
  5. Shoppers can avoid brick-and-mortar stores. As safety concerns due to the COVID-19 pandemic loom over the heads of shoppers, subscriptions allow them to avoid entering a physical store.

Implement A Subscription Solution That Will Win Over Skeptical Shoppers

When implementing a subscription solution, retail IT leaders should consider how it will impact three key elements: the retailer, the shoppers, and the customer service representatives. What do these groups need from a subscription management solution to be successful?

First, subscription management solutions should allow retailers to have full control over their strategy. Choose a solution that enables product choice and naming for subscriptions and customization of subscription prices, discounts, frequencies, and trials.

For shoppers, retailers must give a flexible and easy way to control their experience by allowing them to self-manage their subscription orders, including pausing subscriptions, swapping products, skipping an order, and canceling.

Lastly, customer service representatives must be empowered to help shoppers edit subscription orders, manage refunds and create new subscription offerings. This will minimize time to resolution and help build stronger customer relationships.

Retail Subscription Services Are Here To Stay

What started as a craze in the 2010s, subscriptions have quickly become a significant part of the online customer experience. Our survey found that nearly half of U.S. consumers with a subscription signed up as a result of the pandemic. Now, 85% of these respondents plan to keep their new product subscriptions once the pandemic ends.

There’s an opportunity for savvy retailers to take advantage of the growing product subscription market. Once implemented, retailers will gain deepen customer relationships, lower acquisition costs, and a steady stream of revenue and insights from their subscription experiences.

About The Author

Meyar Sheik is President and Chief Commerce Officer of Kibo.