For business owners, you need to explore different ways of earning revenue. Traditionally, your main way of making money is through sales. Each individual sale earns you some cash, and if you make enough sales you’ll be in profit.
However, there’s another way of making money that you may be overlooking: subscriptions.
What is a subscription?
Effectively, it’s when someone pays for your product/service on a recurring basis. You see this a lot with mobile apps – instead of paying once to buy the app, an individual pays a set fee every month to access all the features. By generating customers, you are getting more and more people to sign up for a subscription to something you’re providing.
Why are subscriptions the best way to earn revenue?
When you’re trying to generate subscribers, you will still embark on similar marketing tactics as you would to generate sales. After all, you are still trying to make a sale – there’s just one significant difference.
A subscriber is, by definition, a loyal customer. They are returning to your business time and time again because they’re constantly paying for your services. If you have a large list of subscribers, you can also guarantee a set amount of revenue for each month until people cancel their subscriptions. It puts less pressure on the need to constantly make more sales as you know you’re getting money no matter what.
You also have the benefit of tying people to your business. In turn, this increases the likelihood that you can retarget them with other products/services. Someone that’s subscribed to your service is more likely to buy another product from you or subscribe to a different service as well. Why? Because they trust you, which is reflected in the fact that they’re still paying for their subscription! It opens doors to make more sales to your loyal customers.
Another benefit of this revenue tactic is that you don’t depend on people actively using your business. Someone could pay for a membership or subscribe to something every month, but they may not use it all the time. It doesn’t matter; if they haven’t canceled, you’re still getting paid!
How to set up subscription services
Begin by deciding what you want people to subscribe to. Is it an app? Is it some software you’ve created? Is it a blog that posts unique and helpful content? Many ideas spring to mind, and once you’ve decided you should set up the billing options for subscription payments. This makes it easy for customers to sign up and pay for the service on a recurring basis without needing to remember to do so. Thus, money always enters your account.
From here, you need to focus on keeping your current subscribers and drawing in new ones. New customer offers are always smart, hitting them with a discounted subscription for a period before raising it to the normal rate. It’s also a clever idea to reward loyalty, encouraging people to stay subscribed for longer.
When done correctly, a subscription can be the best way to earn revenue for your business. It generates lots of monthly income and paves the way for many other opportunities.