I have written in the past about the market for subscription boxes, in particular how they are changing the male grooming market. There are now thousands of subscription box services in the USA and new ones are being created faster than the bad ideas are running out of steam.
I pointed out, when I wrote my article a few months ago, that the market for women’s subscription boxes was already highly innovative, with brands testing new ideas all the time, but the male market was focused pretty much just on beards. Some men love their beards, but the male grooming market is a lot bigger than that so it’s a surprise to see less innovation in this area — so far.
Subscription-based services in areas where you might not expect them to exist can really shake up and invigorate some stagnant businesses — across many different sectors. I saw research recently published in Entrepreneur magazine that suggested that 70% of executives expect innovation to be a driver of growth in their business, but 65% lack confidence in their ability to light that spark.
The really interesting insight from Entrepreneur features is how it emphasized that your subscription service does not just succeed based on the quality of the products. It’s also essential to be able to offer a great customer experience and to be able to use the data you have on your customer behavior so you can use predictive analytics to deliver what they want when they need it.
These services don’t have to be about beauty. You can buy wine on subscription, coffee, or even health products. Some health stores and pharmacy chains are offering health checkups that then create a personalized monthly kit of vitamins, minerals, and other health products — all designed for the individual customer.
But once you get the customer signed up, there is a tendency to kick back and relax and this is one of the big mistakes new subscription companies make. To really succeed, you need to follow these three guidelines:
- Engage with the customer: Once hooked and paying their monthly fee, don’t just relax and take the money. Encourage them to talk about the products, engage them, see what they like and dislike. Keep a conversation going as if you are friends. They are generating reviews and new content.
- Great customer service is essential: You might be like friends on Instagram, but when there is a problem, treat the customer professionally — not like a buddy. Look after their complaints and do what you can to close down the problem. Most customers who quit a subscription because of a problem are more upset about the way their problem was handled, rather than the initial problem.
- Analytics: You know what they bought, you know what they like, what they browsed on, and what they hated, so do something with all that data. Offer them some personal deals and recommendations and hook them in for a few upgrades based on the things you know they love! But don’t make it look like a sale, make it feel like they just got a great deal…
Innovation is taking place in all areas of the customer relationship, but subscription boxes is one of the fastest consumer businesses that is changing and reacting to what customers want. This is one place to watch if you want to see how innovation will shape different industries in 2020.
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Photo by HE Smalley licensed under Creative Commons.