Introduction

Subscription eCommerce is expected to grow to over $450 billion by 2025 (PR Newswire). Indeed, it creates a very intriguing success opportunity for those interested in learning how to start a subscription business.

Want to set up an eCommerce subscription company, too, but are not sure how to start?

If so, buckle your seat belt up! LitExtension – #1 The World Shopping Cart Migration Expert will discuss all the basics of how to start a subscription-based business. Then, you will be headed to a step-by-step guide on launching your first successful subscription businesses.

Read on to find out:

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Start a Subscription Business – An Overview

1. What is a subscription business?

Creating a subscription service for almost any product or service is possible in today’s digital age. And before learning how to set up a subscription service, let’s clearly know what it is and the most popular types of subscription business models.

Subscription business models are centered on the idea that rather than charging a single, big up-front fee for an extended period of service, a single consumer would make many smaller payments over the course of the contract.

In other words, the company sells a product or service regularly in exchange for a scheduled payment, often monthly or annual.

When learning how to start a subscription business, the magazine business is the most common subscription-based business model example:

Instead of selling magazines individually, many publishers offer customer to buy subscription services, where readers may have new issues of their favorite magazines sent to their doorstep weekly or monthly.
In this business model, clients pay an annual membership fee instead of buying a monthly magazine copy. For instance, if a magazine publisher sells a 12-issue subscription, the subscription would be sold as part of a 12-month service.

Choosing the right kind of subscription company is the first step to knowing how to start a monthly subscription business. For SaaS businesses, many good tools offer suitable subscription billing models to choose from. To help you make the best decisions for your future, we have compiled a list of the best types of subscription services to learn how to start a subscription business.

Access base: Customers pay to get access to certain items, such as streaming or software apps.
Consumption base: Including mobile phone plans and newspaper subscriptions, charge clients for what they use.
Product base: Such as monthly box deliveries.
Service base: Including cleaning or lawn care.
And, Freemium model, where clients get basic features for free but pay for premium ones. Spotify for subscription services is a prominent example.

2. Benefits of a subscription business model

Instead of constantly marketing to new clients, subscription businesses will see increased revenue over time by keeping existing clients’ feet. Thus, you also lock in MRR, which may keep your company viable even in the worst circumstances.

But it’s not just that.

A subscription model may be an efficient and fruitful way to manage a company if you have the correct product, brand, and market:

Make reliable revenue forecasts

Revenue forecasting for subscription-based businesses is substantially more straightforward. Because your customers are making regular payments to you, you can predict when and how much they will pay.

This can help you have a more precise picture of your company’s assets when you incorporate a budget into a business plan.

Improve customer connections

Strengthening connections with repeat clients is an essential part of doing subscription business. Customers will grow loyal to your brand and your service staff when they feel they can always rely on them for helpful assistance.

As a result, subscription models enable you to focus on those who are already familiar with and committed to your brand.

Reduce the marketing expense

You may spend less time and money on advertising and cultivating new customers in this business model. In most cases, word-of-mouth marketing from visiting customers may outperform and cost less than many other forms.

Attractive pricing deals for customers

The price tag of a product or service is one of the major factors for customers to consider purchasing it. By billing on a periodic basis (every week, month, or year), you may charge a more manageable price and give customers time to include it in their budgets.

How to Start a Subscription Business?

Convinced of the benefits of a subscription business model? We’ll now look at the steps on how to start a subscription box business.

1. Choose your subscription idea

The first thing you should do when starting a subscription-based company is to settle on the subscription box business ideas of how your service may work (and how it can be different from others).

If your snack line is doing well, a subscription model may be an excellent approach to ensure regular income. On the other hand, you can develop a brand-new concept for a subscription box.

Regardless, you should first brainstorm your subscription concept and sketch how to run a subscription service.

2. Select your subscription products

Then, decide on the goods you want to sell in your subscription company. Construct a “prototype box” or trial subscription to show prospective customers what they may expect to get in their regular shipments.

This doesn’t have to be fully exact yet; Just make sure the things you start stacking up for marketing images match the same sorts of products you’ll really be delivering.

Afterward, you could also begin contacting wholesale businesses to get the items at a reduced cost. You can begin pricing out your subscription after you have determined the sorts of things you will sell and the costs at which your new service can make those purchases.

Depending on your products, there may even be several subscription tiers.

3. Build your website

The third step of how to create a subscription service, you can go on with developing your website. Images of sample items, sign-up forms for the next shipment, and details on any other related-product information will all be posted here.

So, how to set up a subscription website? If you are unfamiliar with coding, BigCommerce and Shopify are two of the most popular eCommerce platforms that provide code-free design tools.

Shopify

Shopify, one of the most popular eCommerce platforms, is appreciated for its intuitive design when users learn how to start a subscription business:

It provides a large selection of apps and modifiable themes to enable companies to launch an online shop that is really representative of their brand.
Its pricing plans vary from the freemium Starter plan to the paid Plus plan, making it suitable for enterprises of all sizes and budgets.
In addition to its online storefront, Shopify also provides a POS (Point of Sale) system, allowing users to sell their wares in physical locations.

Grasp more insights about the Shopify eCommerce platform with:

BigCommerce

On the other hand, BigCommerce is favored by companies seeking a strong and sophisticated eCommerce solution because it offers more features and more flexibility than other competing platforms:

Its robust in-built capabilities simplify the process of running and expanding an online store. It allows companies to provide one-of-a-kind services to their clientele and a wide range of new possibilities.
Inventory management, order processing, and automatic calculations for shipping costs are some of the standard services it includes.
And, BigCommerce is also a very flexible platform since it provides an API (Application Programming Interface) that lets companies tailor their online storefronts and combine them with third-party applications and services.

Which is the best?

If you want to be sure the platform is a suitable match for your company, you should utilize the trial plan to test it out. It’s a chance to see whether the platform’s features, layout, and compatibility all work as they promise.

Companies may try out BigCommerce’s features risk-free for 15 days. During the trial period, companies can access the system’s capabilities, including inventory and order management and shipping and tax calculations.
Stores may try out Shopify without spending a dime for 3 days. All of the platform’s functions, such as stock and order administration, and many themes and applications are available.

With either trial, you may put the service to the test without making a financial commitment or providing any payment information. Then, when deciding on a platform and setting up a subscription website, it’s time to work on your online shop or Marketplace profile.

Wondering which platform is the best for a Subscription business? Check out these articles:

4. Market your new subscription business

All set!

Now that you know how to start a subscription business, you need to promote it to your target audience and begin collecting new signups.

Promoting is essential to the success of any company, so here are some of the marketing tactics to use for your brand-new business:

Create a mailing list and update it often.
Consider partnerships with KOL and micro-influencers
Create and share press release articles announcing your product launch.
Connect with other online groups to help spread the word.
Hold competitions and give out free samples.

Tips: Business growth is exponential, so even if it seems sluggish initially, hang in there. Working hard and being patient will pay off in the long run as your subscription company expands.

How to Start a Subscription Business – FAQs

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Conclusion

In this article, we have outlined every detail you need on how to start a subscription business, from overview facts to a step-by-step guide.

Make use of our article to guide your efforts in identifying opportunities and developing a plan to achieve your objectives.

Need help? Get in touch with us today, or join our thriving eCommerce community, and you can always ask and learn from the experience of thousands of others.