Get to know Subscription and its Benefits for Your Business!


Nov 10, 2020 • 4 min read

Subscription Blog Image

Subscription program is a business model in which a customer agrees to make an advance payment in order to receive a product, service, or benefit in regular intervals.

If you are looking for a way to retain your customers better and increase customer loyalty, one of the tools you need to be looking into is subscription! It is considered to be the ultimate way to lock your customers and prevent them from switching to other brands.

Let’s examine some subscription programs out there to understand the essence of the subscription model. It is actually a business model that can be easily understood through examples. 

  • Amazon Prime offers a subscription program where customers can pay a fee to receive all-you-can-use free shipping for a year. 
  • Grab also offers a subscription whereby customers can pay a sum of money to receive a bundle of discount coupons for future rides. 
  • Personally, I paid monthly to a certain car wash company in my neighborhood to receive 40% off car wash service for every visit in that month. 

Nowadays, most of us should be familiar with businesses with strong subscription economy, like Spotify or Netflix. You might be asking, my business is nothing like those examples, so how can I start a subscription program? The good news is, subscription is actually suitable with most businesses!

This is even more true in this COVID-19 era. When everything is uncertain, customers find comfort in having a steady supply and receiving the products they need without much hassle. Subscription acts as a guarantee that they will always receive their products first things first on a Monday morning every week, for example. The certainty of subscription programs is what makes it even more appealing during these times.

For your business, subscription promises these three benefits:

1. Upfront and predictable cash flow 

Upfront cash flow means that customers pay in advance regardless of usage. This way, your revenue will be predictable. You don’t have to worry about not getting revenue every month because subscription provides a certainty that you will! This is surely desirable for all kinds of business, as it creates a healthy cash flow. With predictable income, you can plan for the future. 

2. Locking the customers

What’s even better is that subscription programs are getting more common these days. Customers have adapted to understand how subscription works. This makes it easier for your business to offer subscription services. Once you find a customer, you need to lock them in and form a beneficial, long-term relationship with them. Retaining customers this way is much more profitable than acquiring new ones, and they are more likely to have a higher customer lifetime value in your business.

Luckily, with subscription programs, customers are also less likely to switch brands. Because once they have invested in your business, naturally, they would want to make full use of their subscription plan by choosing to go to your business over your competitors!

3. Trigger customers to buy more selections of our products. 

Most subscription programs provide products or services at a cheaper price, and as a result, customers will take advantage of it by making the most of their every visit. Not only will they visit your business more often, they will also end up buying more products every time. Thus, with subscription programs, you are opening up more opportunities to upsell other products or services and increase your subscriber’s basket size.

Compared to loyalty programs, subscription may be less familiar or preferable to most companies. However, its benefits are promising and crucial to increase your customer retention rate. By formulating an attractive subscription package, your business is able to attract customers into subscribers. It is also easier to capture and leverage your subscribers’ data because they are locked in to your business. This helps you create more informed business decisions to move forward.

Subscription is an essential customer retention tool that is valuable to any business. If you are a business owner who is looking to retain customers better through a subscription system, look no further because we are more than happy to help. Contact us to learn more!

Let's Talk to TADA Team


Yunny Yunita

A strategic planner with a passion for brand marketing and the written words. In her free time, she enjoys travelling, laughing, relaxing with a book near a scenic place, or better yet, all three at once!