Spreading Good Cheer Through Subscriptions This Holiday Season
That time of year is approaching, when sleigh bells are rung, dreidels spun—and retailers look forward to making their revenue numbers for the year.
For retailers and shoppers alike, the holiday season officially kicks off on Black Friday followed by Cyber Monday, an even more popular shopping day. Last year, 67 million shoppers stole time away from work to make a dent in their holiday gift list on Cyber Monday. Overall, online purchases account for around 20% of holiday sales.
And let’s not overlook the impact of mobile, which last year saw its share of total digital commerce reach 40% on Thanksgiving and over 50% of Cyber Monday. With total holiday sales topping $1 trillion in 2018, it’s definitely a joyful time of year for retailers.
The National Retail Federation (NRF) forecasts that this year, holiday sales will grow from 3.8 to 4.2 percent compared to last year—an increase that translates to over $728 billion. And the fact that sales during November and December account for approximately 20% of a merchant’s annual revenue attests to why the holiday season is such a critical time for nearly all retailers.
Subscription businesses too depend on the holidays to fill their coffers, particularly those businesses in the B2C category. What are some of the tactics that subscription companies can use to cut through the din of seasonal sales and specials to claim their share of consumers’ holiday spending?
Recurring gifts are the best gifts
Gift subscriptions take advantage of the enthusiasm of your most loyal subscribers to share their love of your subscription service. A box-of-the-month subscription offering some fabulous array of products is an obvious example, but there’s no reason a subscription such as an OTT streaming service isn’t also a perfect gift for the right recipient.
Gift subscriptions have the added benefit of lowering your subscriber acquisition costs. Recurly’s customers are able to market both gift cards and gift plans via our feature-rich gift subscription capability. Read more about this feature here.
Increase your subscriber base through coupons
Since the early days of coupon-clipping, it’s been proven that shoppers everywhere love a deal. Recurly has an easy-to-use coupon functionality, which includes the ability to create coupons in bulk, each with a unique redemption code. This capability is key to setting a maximum number of coupons that can be redeemed in any one campaign.
In addition to being a time-tested marketing tactic, coupons also allow you to A/B split test your offer before you launch it widely to your prospects. Simply create your test offers, send the two different versions to a subset of prospects, and compare the redemptions in Recurly to see which version was the highest performer. It’s that easy.
Minimize friction with cardless free trials
Offering free trial subscriptions, which lets prospects ‘sample’ your subscription service before they commit, can be an incredibly effective subscriber acquisition tool—particularly for certain industries. For example, OTT providers use free trials very effectively, allowing subscribers to experience the quality and breadth of the service before they commit to a subscription.
Recurly’s own research on subscriber acquisition found impressive conversion rates for free trials, with median conversion rates of 60% across all sites included in our study. B2C businesses converted 57% of their free-trial subscribers.
But, for these ‘tire-kickers,’ having to enter payment information for something that’s free can add unnecessary friction and reduce free trial sign-ups. And a lost prospect is a lost opportunity to acquire a new subscriber. Thus, Recurly offers ‘cardless’ free trials which do not require the prospect to provide any payment information. Read more about this feature on our blog.
In our next blog, we’ll cover some less common, but no less effective, ways of acquiring new subscribers this holiday season and beyond.