For Immediate Release:
Dateline: Boston,
MA
Thursday, January 17, 2019
Sponsored by Vindicia Source: Vindicia Today, consumers prefer subscriptions. Be it software or content, cosmetics or cars, consumers prefer to experience a product or service for a low monthly fee, rather than own it for a higher price. As a result, more and more businesses are looking to better understand how they can adopt and succeed with subscription business models. The subscription lifecycle is a framework for describing the needs, processes, capabilities, and knowledge that subscription businesses require as they acquire, bill and retain subscribers; grow their operations; and, achieve financial success. Subscription business success requires intelligence at all phases of the subscription lifecycle. Those that excel at all stages of the lifecycle stand the best chances to succeed! [WEBINAR Feb. 7] Subscription Payment Trends Impacting Your Bottom Line Learn subscription-specific payment processing trends that will eat into your profitability in 2019. We will outline the strategies you will need to implement in order to minimize their impact. If you operate a subscription or membership business – regardless of subscription vertical, industry, consumer focus, or transaction volume – your revenue is impacted by payment trends and market dynamics happening right now. LEARN MORE.  Source: Vindicia The Acquire phase includes activities such as product and offer definition, segmentation, personalization, pricing, packaging, promotion, campaigns, testing, iteration, onboarding, and entitlements. Mckinsey’s famous contention that companies must either “grow fast or die slow." translates into a minimum annual growth of 20 to 30 percent, so customer acquisition (and retention, see below) is a “do or die." activity. Two essential capabilities that drive acquisition are: - Go-To-Market Flexibility: The ability to rapidly define any package that your marketing and sales teams dream up – unrestricted by software, IT, cost or time limitations.
- Agility: Ultra-fast time to market for new products, and the ability to rapidly iterate to experiment and fine-tune offers (e.g., changing price and adding features).
ACQUISITION TIP: At what stage should you ask a customer for payment details? Before a free trial or after? You might assume that asking before the trial would discourage sign-ups. However, our data reveals that in the long run, conversion increases if you take payment data at the beginning of the free trial.  Source: Vindicia The Bill phase covers billing, invoicing, payment handling, tax calculation, fraud detection, chargeback management, accounts receivable, revenue collection, revenue recognition and reporting. Billing is not just a technical or logistic necessity; it is a strategic weapon for acquisition, income and retention. Flexible billing enables innovative marketing. For example, CashBox offers multiple pricing strategies to attract buyers with different preferences, like usage-based billing, recurring charges, discounts, tiered options, virtual currencies and more. You don’t want to swap your billing platform frequently. Billing is core to your financial management. Make sure your billing platform is designed to support your growth and expansion. Make sure it is highly scalable, supports global currencies, global taxes and traditional and alternative payment methods, including national credit cards and digital wallets such as PayPal, Apple Pay, Amazon Pay, and so on. BILLING TIP: The more payment methods you offer, the better, right? Wrong. Our data reveals that there is an optimal number and mix of payment methods that strikes the best balance for customer acquisition.  Source: Vindicia The Retain phase starts from the moment a subscriber signs up. It encompasses customer engagement and loyalty programs, as well as ongoing challenges such as churn prediction, churn prevention, retry, dunning and crucially, recovering failed transactions. Retention is high stakes for subscription companies. The cost of retaining a customer is one fifth (some say one-tenth) the cost of acquiring a new one, so smart businesses invest in customer relationships and retention from the moment a customer converts. There are two types of churn – active churn and passive churn and each needs to be combatted differently. - Active Churn: Active Churn occurs when a customer is disappointed with your service and leaves by choice. Businesses should protect themselves from active churn by modifying the product or pricing, improving the communications of the value of the product, offering loyalty points, bonuses, and other tools to encourage customer engagement.
- Passive Churn: Passive Churn is when a customer leaves your service not by choice but as a result of a glitch in the payments network resulting in a failed credit card transaction. The traditional tools for combatting passive churn are limited to retry, account updater and dunning.
RETENTION TIP: Focus on reducing both active and passive churn is the #1 area ignored by subscription companies and the "lowest hanging fruit" to look at for increasing revenue and profitability. Our data reveals for example that subscription companies can easily reduce involuntary churn by 15-30% and boost revenue from those efforts by 3-5%  Source: Vindicia The Expand phase is about extending your horizons and vision. It includes core processes such as cross-sell and up-sell, but also daring to launch new products, new properties, and expand geographically. Revenue growth is the life-blood of subscription businesses. Revenue growth funds acquisition, expansion, and innovation. Expansion is primarily in two dimensions: - Grow Existing Revenue: Build up by attracting more customers and then cross-selling and up-selling to your customer base.
- Grow New Revenue: Expand your area of operations to new products, new lines of business and new geographies. CashBox’s wide-reaching support for languages, currencies and global tax compliance make it easy for subscription businesses to expand domestically and internationally.
EXPANSION TIP: Renewals are key to expanding and growing your subscription business. Our data shows that the optimal way to design and communicate a renewal offers varies by subscription segment and subscriber profile, so make sure you test and look at your data as you develop your strategy. Source: Vindicia The Succeed phase includes one-off activities such as implementation, integration, and migration, but more significantly, also ongoing optimization driven by consultation, benchmarking, analytics, and business intelligence. Great products and great service do not guarantee success. Subscription business success necessitates excellence at all phases of the subscription business lifecycle. You need business acumen. That means domain expertise - in subscriptions, payments, marketing, sales, financial management and more. If you have any questions about how Vindicia can equip you with all of the capabilities you need to help you succeed and grow, please let me know.
Kevin Cancilla is an industry veteran with extensive experience in strategic marketing for enterprise software companies and SaaS-based businesses. Kevin serves as Head of Global Marketing for Vindicia. Providing much more than just a billing and payments system, Vindicia’s SaaS-based subscription management platform combines big data analysis, strategic consulting and proprietary retention technology. Vindicia provides its clients with more recurring revenue, more customer data, better insights, and greater value throughout the entire subscriber lifecycle His 15-plus-year track record includes developing integrated multi-channel marketing programs and partnerships that yield financial results, expand the customer base, increase market share, and build brand affinity. Prior to joining Vindicia, Kevin held senior marketing positions at STEALTHbits Technologies, Tripwire, Epicor, Baan, and Adobe Systems. He holds a BSBM degree in marketing and business management from the University of Phoenix. To learn more visit www.vindicia.com. Read Full Bio
About Subscription Insider and Subscription Show 2019
Subscription Show 2019 is produced by Subscription Insider, a media company focused on the business of subscriptions, and the industry's leading source for subscription-focused news, how-to information, training, and research. Learn more at www.subscriptioninsider.com
Subscription Insider brings an independent editorial eye to the educational content and overall design of Subscription Show 2019, a deep-dive into all thing’s subscriptions. In this one industry conference, you will be able to connect with peers, learn the latest best subscription-focused best practices, and talk to technology and service vendors from across the entire subscription ecosystem. Learn more at www.subscriptionshow.com
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