I just heard on the radio that a new Subscription based flower delivery service has been launched here in Auckland where you pay a monthly fee and get fresh flowers delivered to your door.
This is just another example of the growing subscription economy. Subscription based products are those which you pay to use a product or service without needing to manage or pay directly for individual products. Typically you would pay a fixed monthly amount and the product or service is either delivered physically or digitally automatically.
Historically the subscription based model was only used for a very small group of product types like fitness clubs and magazines and newspapers but in recent years has exploded out and has changed the landscape of a lot of new industries.
Here's some examples of other successful product types that have implemented the subscriptions model in a way which has flipped industries on their head.
- On demand TV and movies (Netflix)
- Razor blades (Dollar Shave Club)
- Groceries (My Food Bag)
- Nutrition products (The Feed)
- Lawn mowing
- Office Plants
Why have companies embracing the subscription model been so successful in these industries.
It's much easier for customers to setup the subscription once and then just get delivered their products or login to a service when ever they want to. The don't need to remember to go out and buy the products they want and the don't need to spend the time doing so.
Each time a customer buys one of your traditional products or services they need to consciously make the decision to purchase. Influencing purchasing decisions is hard. As a business you need to work hard to influence each of those individual purchase decisions. Typically with the subscription model you only need to influence the purchase decision initially and then the payments happen automatically. From then on the decision making process is reversed so the customer then needs to make the decision to no-longer purchase. As long as you are providing a great service and adding value then the customer won't have a reason to make that decision.
Creating Loyalty and Community
With a subscription based model your customers become part of your community. They become "members" not just customers. You can add value by offering additional benefits of being a member through both technology and clever marketing. This can build a huge amount of customer loyalty over time. The more of a sense of community and loyalty you build the longer customers will stay with you and the more likely they will be to refer their friends.
Because your revenue is recurring it is easier to predict over time and therefore easier to plan for budgeting. it is also less effected by seasonal changes especially if your products or services can be delivered globally.
Although individual monthly payments might be less than if you were selling individual products the lifetime value of each customer is typically larger. If you had a customer on a subscription for 3 years their lifetime value is much higher than if they just made a one off purchase.
How can this work for coaches and fitness pros?
Easily. Coaches and fitness pros have been offering subscription based services for a while now but the trick to it is being able to scale it with automated self service products and services. At Training Tilt we've built our software specifically so fitness pros can develop their own branded online platform and utilize the subscription based business model by offering paid access to their platform.
The paid access can include the following benefits for your clients;
- Access to template Training Plans that can be applied to calendars
- Access to your video, article and recipe libraries
- Branded iOS and Android apps
- Social interaction including chat and forum
- Social groups and events
This is how it works, with just a small amount of work with the setup and then everything is automated.
- Signup to Training Tilt if you aren't already
- Create your Training Plans, videos and resources
- Connect your payment gateway (Stripe or Paypal)
- Create your Membership Plans (Bronze, Silver, Gold etc)
- Create add-on products (Training and nutrition plans)
- Turn it on and start your marketing
Now your potential clients can signup and access all of the resources based on the membership plan they've signed up to. Recurring payments happen automatically and you can choose to offer as little or as much personalized service as you choose on different payment tiers you offer.
If you want to find out more get in touch or signup for a trial.
Do the work once but enjoy the revenue over and over again
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