If your business offers a subscription billing service, subscriber retention should be one of your main priorities. If you cannot ensure the loyalty of your subscribers, it will be hard to maintain recurring revenue. The best way to improve subscriber retention is to improve the value that your subscription provides.
Convenience is one of the big benefits of a subscription service and it’s easy for your customers to sign up and let their payments roll over each month. However, there is a downside to that because it does also mean that people will forget about the subscription. If they then notice recurring payments leaving their bank account and they don’t feel that they are getting much out of the service, they are likely to cancel. That’s why it’s important that you find ways to continually show your customers that you are offering them a valuable service.
Subscription bundling is one of the most common ways that you can demonstrate your value and show your customers that they should continue paying their subscription. This post outlines what subscription bundling is and how you can use it to your advantage.
What is a subscription bundle?
Bundling is a common technique in the subscription economy and it simply means adding value to a subscription by offering complementary products or services. All of the most successful subscription businesses use bundling to ensure customer loyalty, and you should be too
The best examples of subscription bundling
The streaming service Spotify demonstrates some of the best examples of subscription bundling. Their music streaming service is already very popular, but they are adding value to their subscription by teaming up with the meditation app Headspace and offering a bundle package for their student users. They already know that their student users are a good target demographic for meditation apps, so it is a good way to convince them to keep up with the recurring payments and keep their subscription. This is known as an adjacent bundle, which helps to retain loyalty and also offers a new subscription acquisition source for both businesses.
Apple is also trying to offset its falling smartphone sales by introducing subscription bundles. They already offer a free Apple TV subscription to students that have signed up to Apple Music. However, they have plans to roll out an extensive bundle in the coming year that includes Music, TV, news, Arcade, and iCloud. In a competitive subscription economy where consumers are signing up to multiple services, this will help to retain loyalty and increase the number of subscriptions so they do not suffer from subscription fatigue.
Options for subscription bundles
If you are planning to use subscription bundles to maintain levels of recurring payments, you have a number of options:
Product – A number of different products can be purchased together as a bundle, with a discount. Alternatively, subscription services may offer a free product in order to add value.
Component – Different components can be purchased together to create one product. For example, buying custom parts for a computer.
Collections – A collection of different services or products bundled together to add more value.
If you are struggling to retain subscribers, using some of these bundling options will help you to entice and keep more subscribers.