Artificial intelligence (AI) continues to transform the ecommerce industry, and subscriptions aren’t an exception. With new technologies come new challenges, and business owners must understand how to incorporate AI into their current strategy and product offerings.

In this article, we’ll share everything you need to know about artificial intelligence and how to best leverage it to enhance the subscriber experience.

What is artificial intelligence?

AI refers to all the applications that perform complex tasks that once required human input. The term is often used interchangeably with its subfields, like machine learning (ML).

However, it’s important to note that although all machine learning is AI, not all AI is machine learning. Machine learning finds patterns and builds systems that improve their performance based on the data they consume, then use them to make predictions.

What are the benefits of AI in subscriptions? 

Artificial intelligence, specifically machine learning, is an effective tool that enhances the consumer and business experience. 

AI requires a good amount of data to make accurate predictions, which aligns perfectly with the recurring revenue model. Since subscription brands build long-term customer relationships, they can collect new data regularly to iterate, experiment, and adapt quickly to subscribers' needs.

Overall, subscription companies can enhance their customer experience, increase retention, and drive revenue growth. Here are five machine learning benefits you can work with: 

  1. Flexibility and personalization: AI algorithms help you analyze subscriber data and create personalized content recommendations based on their preferences, browsing history, and shopping behavior, which can lead to increased engagement and loyalty. 

  2. Enhanced customer service: AI-powered chatbots can provide instant and personalized support to subscribers, answer questions, and solve issues in real time–saving customers time and frustration while reducing the workload on your customer service teams. 

  3. Predictive analytics: AI-powered insights help you identify patterns and trends that would be impossible to detect manually–guiding your future product development and ensuring the service continues to meet subscribers’ demands. 

  4. Customer retention and lifetime value: AI-driven analytics can also help identify subscribers at risk of churning and find upsell or cross-sell opportunities based on their behavior and interests.

  5. Improved churn management: AI can automate and streamline many aspects of the revenue recovery processes. For example, Recurly’s intelligent payment retries help you predict the best time to retry a payment whenever a subscription renewal fails.

Get more insights to minimize churn and maximize revenue

Churn is one of the most sensitive indicators for subscription businesses as slight differences in churn rates can have significant impact on revenue growth and the overall health of a business.

This comprehensive guide shares key drivers to cut involuntary churn rate to 1% and boost subscription revenue by 11% MoM.