Five on Friday: Memberships, Subscription Fatigue and Customer Trust

Featuring The Drum, Amazon, Associations Now and Search Engine Watch

Five on Friday: Memberships

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In this week’s edition of Five on Friday, The Drum explores why brands like Amazon use the membership model, Associations Now shares new reports that question how recurring fees could create subscription fatigue, Search Engine Watch discusses factors that influence a website’s credibility, and Equifax struggles with regaining the trust of customers and investors after a massive data breach.

 

 

 

 

Why the Membership Model Works

 Subscription Fatigue and Customer Trust

Source: Bigstock Photos

A week after Amazon’s most successful Prime Day in company history, it is a logical time to ask why the membership or subscription model works. In a recent article on The Drum, “Hitting Its Prime: Why Brands Like Amazon Chase the Subscription Model,” writer Satyarth Priyedarshi explored that question, using Amazon Prime as the key example. The easy answer, of course, is the value a brand like Amazon offers members or subscribers in exchange for their recurring fees.

At Amazon’s current rate structure, members pay $119 a year for free shipping, Amazon Prime video, free photo storage and a host of other features. For members who shop online or watch streaming video on demand, the membership pays for itself.

The Drum points out that there are other reasons to consider using such a business model. Here are three:

  1. Predictability: When members sign up for your program, you can estimate with some predictability what future sales, revenue and retention will be.
  2. Price control: Even with tiered models, subscriptions allow you to control your pricing. Customers like to know what to expect, and you can easily adjust your pricing for an entire class/tier of subscribers if your costs go up (e.g., tariffs on newspaper supplies).
  3. Better cash flow: What business doesn’t like to have reliable cash flow? This is particularly helpful for long-term planning, overhead and growth.

Read more about why brands love the membership model at The Drum.

Are Too Many Subscriptions Causing Subscription Fatigue? 

Five on Friday: Memberships

Source: Bigstock Photos

How many subscriptions do you pay for each month? 3, 6, 9? I probably have a dozen or so – Amazon Prime, Netflix, Spotify, Dropbox, Office 365, the New York Times, Bark Box, Stitch Fix, Amazon Fresh and magazine subscriptions to name a few. If you’re like me, it is easy to commit to $10 or $20 a year – or a month – for a valuable product or service. However, at some point, the budget conscious among us must be more careful about how we spend, reports Associations Now in “Could More Recurring Fees Create Subscription Fatigue?

That’s the subject of a couple of new reports that surveyed consumers to see how many services they pay for. While subscriptions are convenient and easy commitments to make, those monthly fees add up. Associations Now points out that it is easy to overspend without realizing it. We’ll have to pick and choose what products and services are most important to us and cancel the rest.

A report from Fetch finds that 77 percent of survey respondents said that having so many choices available makes it hard to choose.

“When the costs of subscribing to multiple paid services start adding up, mobile-first consumers are looking for cost-saving measures which include greater tolerance for some advertising vs. an ad-free experience,” the report states.

Learn more about the dangers of subscription fatigue on Associations Now. 

Seven Factors That Influence Your Website’s Credibility 

 Subscription Fatigue and Customer Trust

Source: Bigstock Photos

You’ve built what you believe is a great website – it’s sleek, easy to navigate and it provides a user-friendly experience. But is your site credible? These are the factors that influence your site’s credibility, according to Search Engine Watch:

  1. How search engines rank your site
  2. Your company’s social media presence
  3. Subscriber testimonials and reviews
  4. Advertising on your site
  5. Up-to-date blog with fresh content
  6. Regularly updated website
  7. Easy-to-find contact information.

Find out how these factors impact your website’s credibility on Search Engine Watch.

3 Customer Retention Strategies from Top Brands 

We know that acquiring a new customer costs significantly more than retaining an existing one. In fact, according to Hubspot, retaining a customer costs five to 25 times less than acquiring a new one! Here are three strategies from top brands to help you keep your customers happy.

  • Starbucks: Give your customers convenience. One of the company’s top innovations that keeps customers coming back again and again is its Mobile Order and Pay feature. This saves on wait time, and we all love having more time, right?!
  • Tesco: This U.K. supermarket chain uses Twitter to target and personalize messages to its customers.
  • Apple: Differentiate yourself from the competition. Remember Apple’s Mac vs. PC campaign? Here’s a refresher: