How Customers Shift To Subscription Payment?
Customers are increasingly choosing subscription payments for three main reasons:
Access
Curation
Renewal/Replenishment
According to McKinsey Analysis, 13% of customers subscribe for access to more features, 55% of the customers subscribe for curation of service, while 35% choose subscriptions for the convenience of renewal or replenishment, which essentially means saving time and consistently meets their needs.
Example of Subscription Revenue Model
There are three approaches to urge customers to subscribe to your payment plans.
Specific Offers: One approach to urge your customers to shift to subscription payments is collecting membership fees in return for special offers. Examples of this strategy can be Walmart, Emirates Airlines, Noon, Talabat Plus, and more.
Time-Limited Access: Another approach is providing time-limited access to services like software-as-a-service (SaaS) companies, media, and entertainment platforms. Examples of this approach are GoDaddy, Zoom, Slack, and more.
The Subscription Box: the last approach is a ’subscription box’ service. The subscription box service is another way to curate services and deliver products to customers repeatedly, such as ready meal services. For instance, Blue Apron and Factor are vivid examples of this approach.
Losing revenue to churn or failed payments? Talk to our in-house expert and see how we can reduce churn with smart retries, secure card vaulting, and tailored subscription logic.
Your Technical Partner After Receiving Subscriptions
Choosing a dependable technical partner is key once you start receiving subscription payments, as they'll help you manage the technicalities of the subscription model effectively.
Look for a subscription partner who can provide:
Customizable subscription plans tailored to various needs
Configurable pricing tiers
Efficient management of billing cycles
A range of payment methods to suit different customer preferences
Automated recurring billing for hassle-free transactions
Secure payment processing to ensure data safety
Subscription Revenue Management
While the subscription model is powerful, managing its operations can become complex as you scale. That’s where subscription revenue management becomes essential. This involves the oversight and automation of:
Customer lifecycle tracking: Understanding where users are in their journey—from free trial to paid, or from active to churned.
Billing and invoicing: Automating when and how charges are applied, especially for upgrades, downgrades, or mid-cycle changes.
Revenue recognition: Ensuring compliance and accurate tracking for financial reporting and forecasting.
Churn mitigation: Leveraging analytics to intervene early and retain at-risk customers.
MoneyHash Subscription Module Covers All Your Needs
The MoneyHash subscription module is your all-in-one solution for managing subscription payments. It allows you to create unlimited customized subscription plans, including varied pricing, billing frequencies, end dates, and free trial periods.
You can select from pre-designed plans when launching new subscriptions. Then, you can apply any discount for more compelling offers for your customers. Easily enough, each plan can be tailored to meet individual customer needs.
MoneyHash also supports a variety of payment methods, catering to diverse customer preferences.
Additionally, MoneyHash can tokenize your customers' cards for automated billing. You'll be able to keep track of your customers' subscription statuses and make necessary adjustments as required.
Conclusion
The subscription payment model is a great strategy for maintaining customer loyalty, increasing revenue, and extending customer engagement. However, managing it can be complex. Partnering with MoneyHash simplifies subscription management, ensuring a smooth and secure experience for both you and your customers. Get started with MoneyHash today for a tailored subscription management experience and let our team assist you with any queries.
