If you need a new outfit, you might head to a department store and hope to find something in your style, size, and price range. After agonizing over the selection, you buy something you feel just OK about and spend more than you wanted to. The transaction’s over.
Compare that one-and-done experience to how things work at Gwynnie Bee — a plus-size clothing rental subscription service — which keeps its customers in a long-term relationship through its subscription model. For a monthly fee, women can shop designer brands, put items in their virtual closets, and sign up to have up to 10 items shipped per month. They can exchange for another item in their closet at any time and keep their wardrobe rotating.
This business model can be highly lucrative because it creates a recurring revenue stream. It also meets the primary criteria for a successful subscription model company: It taps into a niche target market to build a healthy subscriber base.
To get started, however, you have identify your target audience and market to it. Then, you must work on maintaining a high interest level and keeping subscribers long term. Here are five steps to follow:
1. Identify Your Target Audience
In building your subscriber database, your first job is to identify your primary, secondary, and possibly tertiary customers. Once you’ve identified your ideal customers, you have to focus on smart, effective marketing.
For example, BarkBox, a popular subscription service that provides monthly deliveries of curated treats, toys, and supplies for dogs, doesn’t just target pet owners. It targets “pet parents” who absolutely adore their canine companions and have enough expendable income to splurge on a monthly box of goodies for their furry best friends.
2. Execute Optimized Targeted Marketing Campaigns
Once you have your ideal customers in your sights, it’s time to build a customized marketing campaign to wow them with your product or service. This may mean writing highly informative blog posts that will build a passionate audience, targeting them with social media ads, or giving out free samples at niche events.
BarkBox, for instance, could target dog owners within a certain income range with Facebook ads, develop dog-focused Pinterest boards, or write informative articles and blog posts that answer important questions for “pet parents” of particular breeds.
3. Pique Your Audience’s Interest With Great Content
With anything that’s socially driven, you need to have content worth talking about. It needs to be unique, valuable, and relevant to your target audience. For example, Gwynnie Bee’s blog, “The Hive,” builds a community that its subscribers want to be part of. It offers sizing tips, style ideas, and lots of subscriber-shared photos featuring Gwynnie Bee fashions.
4. Use Data to Customize and Personalize
Don’t stop marketing to your subscription audience just because they signed up. A customer’s decision to sign up for your subscription service is only a first step. To make this relationship so valuable that your customer wouldn’t dream of leaving, you must personalize and customize your offering. My friends over at Birchbox are masters of this strategy.
Birchbox creates highly customized boxes of curated health and beauty products. Customers are happy to fill out questionnaires and hand over their data because they know they’ll receive Birchboxes filled with products perfect for their skin tones, body type, etc., in exchange. This is a huge advantage that the subscription model has over the traditional point-of-sale retail model.
5. Analyze Your Results and Iterate
There’s no reason to spend money, time, and effort on a subscriber growth campaign if you don’t measure your results. Study your analytics. Did the Facebook ad campaign result in a noticeable uptick in visits to your sales page? Did the sales page convert? What about the blog posts your marketing department spent a week crafting? Are users finding them and reading them?
When possible, use split-testing and assign values to different conversions along your sales funnel. Toss what doesn’t work, and refine the avenues that perform best for you. I strongly recommend focusing on just three to five marketing channels at a time so you don’t overwhelm your team or water down your impact.
It all starts with finding the right customers, developing marketing campaigns that speak directly to them, and analyzing and improving those campaigns. Once the customer is a subscriber, create customized offerings that will delight every time. You’ll not only have a brand advocate, but you’ll have also a customer for life.