Chances are 2020 and 2021 looked nothing like you thought they would. Your goals were traded in for pivots and entrepreneurs everywhere switched from a state of ambitious enthusiasm to survival mode. Whatever 2022 has in store, this is certain: you and small business owners everywhere deserve less stress and more money.
Most new revenue streams involve a lot of additional work. Luckily, we’re not suggesting anything arduous. We’re suggesting adding a subscription, AKA recurring income, for your core community by repeatedly doing something you already do. A subscription that is something you’re already damn good at, that is uniquely you, that simply yields more passive income.
Sounds good, right? Though the new money coming in is exciting, there actually is more to consider when launching and growing your subscription to get it juuust right.
Here’s what you need to consider to add a subscription to your business.
What do you already do well that can be a subscription?
Your subscription plan should be tightly focused around one key benefit. What is the thing you plan to offer to people? If you're a yoga teacher, it might be a yoga class. If you're a florist, it might be a floral arrangement. It's important to make sure that this, your headline benefit, is clear, specific, and singular. Chances are the thing that popped into your mind as your headline benefit is something you are already incredibly skilled at. It is something that is unique to you and your business. No two subscriptions are exactly the same, which is what is going to make yours special.
Who exactly is your subscription for?
In order to build a successful subscription, it's critical to identify your ideal subscriber. This is the best possible subscriber you could have. Somebody who is devoted to what you do. Your future subscribers are probably people you already know! They’re not the one-off customers, they’re not even the sometimes customers, they’re your regulars. They already curate their lives with you in it, and by subscribing they’re simply proving their commitment… and saving a bit of money.
How much should you charge for your subscription?
I’ve had thousands of conversations with entrepreneurs over the last decade, and how much to charge is the single most asked question I get. Pricing is hard. Knowing your worth, valuing your time, minding your margins, and still being competitive all add up. Pricing is really, really hard.
The subscription math needed, however, is not complicated. Simply imagine your offering as a one off transaction (keeping in mind things like shipping costs and taxes, of course), and then remove 20%. That’s your regular subscription fee. It’s a deep enough discount to excite customers, but it’s not so deep that it isn’t worth it to you. Most importantly, since it’s a regularly occurring payment it really adds up in the long run.
At what cadence should you run your subscription plan?
This, again, is very personal. If you want to emphasize the passive in passive income monthly or even quarterly makes the most sense. If you’re offering something that needs replenishing often, like coffee beans, you might want to charge monthly but still have weekly pickups or deliveries. Monthly is how most salaries work, so this timing for payouts is preferred by most entrepreneurs.
A great way to decide your cadence is to talk to your core community! Those diehard customers, or soon-to-be subscribers, because they care about your success! Ask them for their feedback, and be sure to listen.
Pro tip: Batch your subscriptions. If you’re shipping curated surprise boxes once a month, pick a day per month, like the last Tuesday of each month, and be consistent. Get most of your subscription plan work done one day. Set it and forget it.
Other important things to consider
If you’re selling physical goods, tracking your inventory is important. Don’t forget to account for your subscriptions with your other transactions so you yourself know what needs replenishing.
Pro tip: If you have a brick and mortar, a $0 button on the register for what's leaving the shop with each subscription can be very helpful. It will streamline tracking your inventory.
If you’re selling digital goods or are activity based, you might have some trepidation about the forever of it all. If you’re nervous about exactly this, rethink your offering. This should be something you’re excited about! This being said, you can still take breaks.
Let’s say you’re a pilates instructor doing biweekly digital classes. Why not do a pre-recorded on demand offering during your holiday? Be upfront with your community with any temporary changes. These subscribers care about you, and life happens. They will understand and remain your devotees.
More than money
As you’ve probably realized by now, adding a subscription is more than just a recurring payment button on a website. It’s something that will be an easy lift for you soon, but it requires care, thought and assistance to launch and grow properly.
Subkit handles the technical bits so you can focus on the important thing, your business. But that's not all, Subkit is also here for you not only through technology, but personally, too. Our experts will brainstorm, help you market, help you create content, help you grow, and just help you with whatever you need to make your subscription work. We know better than anyone that no two subscriptions are the same.