Living in a society where convenience culture rules, it's no surprise that consumers love a subscription model.
Consumers prioritize businesses that can make their lives easier. Whether it's automatically sending themfun-printed underwearat the end of the month to add to their collection of delicates or refilling theirmonthly protein shakesupplies, subscriptions have become a way of life, one that is here to stay.
Most subscriptions are typically set up online from the comfort of home. But how can merchants capture that magic with consumers who visit in-store? Through our partnership with Chargebee, we now bring payment subscriptions to the store as a way for businesses to improve the customer checkout experience, gain deeper customer insights, and enhance in-store operations.
Here's how we’re turning in-person payment subscriptions into a powerful business model for the future.
In-person payment subscriptions in a nutshell
If a customer wants to sign up for a coffee subscription at their favorite cafe, they sign up in-store, tap to activate the payment on the card reader, and then receive a personalized QR code to use at checkout to purchase their hot drink(s).
No downloading an app, filling in SEPA forms, or credit card details are required to activate a subscription. All it takes is a swipe from a device.
For a closer look at how Adyen and Chargebee launched an in-person payment subscription model, check out the video below.
How in-person payment subscriptions differ from traditional memberships
Consumers pay a recurring price to access a product or service with subscriptions, whereas memberships typically require complete upfront billing of products or services. In most cases, a monthly subscription fee is more accessible than a one-time upfront fee. It also allows customers to alter the level of service they receive depending on their personal needs and budgets.
Subscription models also offer variety. Instead of deciding which coffee to purchase, you can mix things up with a subscription. For example, the coffee and sandwich chain, Pret A Manger offers a maximum of five Barista-made drinks daily as part of itscoffee subscription. Customers can choose which one they want each time, as opposed to always receiving the same thing.
This trend has beentaking off among the food and beverage industry, with many recognizing the value in repeat customers. Other industries like Pet supplies, Baby/Infant supplies, Nutrition, Wellness, Food and Grocery, and Beauty would all be prime for this model as they can offer choice and flexibility to keep customers coming back.
The benefits: communication, customer data, and cost
The benefits of In-person payment subscriptions come in the form of the following:
Direct communication and relationships with customers.Through personalized experiences, businesses can learn customer preferences and customize accordingly. Over the past few years, customization and curation have emerged as major consumer trends.
Reliable and improved customer data. Once subscribers have been acquired, data collection can help businesses decide how to price products and services better. They can also track metrics, including customer lifetime value and churn rate. In contrast, it's harder to understand - or predict - consumer behavior when a customer is restricted to a one-off payment.
A predictable revenue stream.As long as the value is clear upfront to customers, investing takes little convincing. Customers also tend to stick with a subscription service after they sign-up, as long as it’s convenient for them.
Accessibility vs. appeal of in-person payment subscriptions
Setting up successful in-person payment subscriptions often requires striking a delicate balance between accessibility versus the appeal of the product or services.
For instance, with the sheer volume of options in the subscription economy, having adigital payment platform that can set up and process recurring payments seamlessly contributes to a positive customer experience. A platform that can initiate payments from various devices and systems, perform refunds, and collect information data correctly, will serve the in-person payment subscriptions model best.
When it comes to appeal, businesses need to keep up and refresh the products and services it has on offer. Take a streaming platform, for example. New content gets updated in the library every month to keep customers hooked. Customers might quickly cancel if the service doesn't deliver a great experience or they no longer see the value.
“There is a reason so many people talk about ‘Subscription Fatigue’,” noted Dan Close, VP Global Partner Ecosystem at Chargebee.
“As budgets tighten, consumers need to continue to realize value from their investments. As a result, we as consumers naturally become much more selective about how and where we spend our money. For businesses to remain profitable, they need to be able to anticipate the needs of their customers. This is accomplished by offering choice - mixing one-time sale options alongside subscriptions, providing the ability to upgrade/downgrade, and having a unified checkout experience to make the experience simple and enjoyable.”
What's next for subscriptions?
We see a boom in the subscription economy as the model expands into new industries.
Think car washes, camping, and theme parks. The list goes on.
With customers opting for products and services that make their lives easier, subscription businesses show no signs of slowing down.
That's why it's more important than ever to think beyond online and pay just as much attention to the in-person experience.
You can also benefit from combining your point of sale (POS) and online traffic and also get to know your customer spending trends better. Having the right technology at your disposal will help you deliver the experience your customers deserve.