product or service

By Migle Lauciute

Every specialist should be alert of the hottest newest trends in his or her field–e-commerce shop owners are no exception. For the last several years one of the most prevalent tendencies in e-commerce has been offering subscription-based services. You should be able to answer questions such as “what are subscription-based services?”, “what are the benefits?”, “how can I implement it?” and so on and so forth.

So, as we all here are e-commerce enthusiasts, let’s discuss the do’s and don’ts of subscription-based services.

The history of subscription-based services

Firstly, the fact that subscription-based services have been here for a while already has to be established. In traditional commerce, subscription-based services dominate the field of media and press. The best example here is various newspaper and magazine subscriptions. However, with the rise of the Internet, it wasn’t long till subscription-based services have found their way into the e-commerce industry. You might not realize it but subscription-based services have quite a stable place in your live–it’s hard to imagine life now without such commonly used services as Amazon Prime or Netflix.

Now subscription-based services are moving even further–from fashion to entertainment, personal grooming and even homemade meals–subscription services are everywhere.

What are subscription-based services?

Subscription-based services are offered by a subscription business model, where a customer must pay a subscription price to receive a product or service. Rather than selling products or services on one-time basis, subscription-based businesses offer to receive them periodically (e.g. weekly, monthly, semi-annually, yearly, etc.)

The grow in the recent years

The popularity of subscription-based services is undeniable–it is proven by the statistics. In the beginning of 2016, the U.S. alone counted as many as 2,000 subscription box services. Let’s look at one of the most successful examples – The Dollar Shave Club. It was founded in 2011 and by the end of 2016 its worth has reached $615 million.

Other figures suggest that the e-commerce subscription market has grown by more than 100 percent over the last five years. It is indeed a very impressing number.

As for 2017, 90 percent of adults in the UK were spending the average amount of £56 a month on subscription-based services.

The statistics lead us to another question–why are subscription-based services so popular and successful? The most obvious and straight-forward answer is that the timing is just right. The biggest spending power now belongs to the millennials who are the generation of always-rushing young people who don’t always have the time to go grocery shopping and enjoy having products delivered at their doorstep.

How to implement subscription-based services?

Great news! Implementing subscription-based services is rather simple because almost every product or service can be turned into a subscription-based service. You only need to look at your product with a new perspective and create an alternative marketing strategy.

However, subscription-based model works best for products or services people use regularly, for example clothes, food, beauty products, etc.

Whatever you decide to sell, there is one thing you should always keep in mind. Subscription-based services should serve at the customer’s convenience. Everything you do should be planned out perfectly and monitored on a regular basis. Research the best delivery options that won’t disappoint your clients nor you. Also, be very careful when choosing the right payment processor — be sure to pick one which allows recurring payments.

The benefits of subscription-based services


As it was mentioned before, customers tend to choose subscription-based services mainly for their convenience. By choosing subscription-based services, they can avoid going grocery shopping, searching for new recipes every evening or doing other repetitive boring chores. Also, customers don’t have to remember to pay for every subscription product or service separately. The system of recurring payments is created in such way that it charges a credit/debit card automatically on an agreed periodical basis. So, customers will never be suspended from a product/services only because they forgot to pay. However, customers always have the option of pausing/stopping the subscription-based service whenever they please.

Also, it is as convenient for business owners. You can be sure that a certain amount of money will be paid for your products or services every week/month/etc. In other words, it is a source of a stable income.

Customer’s loyalty

If you provide a high-quality product/service for your customers on a periodical basis, it is very likely that you will earn their trust and loyalty. Implementing subscription-based services will certainly help you to achieve that. However, be sure to maintain the same quality/size/amount of the product or service to minimize the risk of having disappointed clients.

Control over personal expenses

When customers use subscription-based service, they know exactly how much money will be taken from their accounts every week/month/etc. It helps control personal expenditure and save money.

Ability to pause or cancel the subscription

It doesn’t take a lot of time or effort to pause or cancel the subscription — usually you only need to click one button. If some time into your subscription you feel like a pause would come in handy, you are free to pause or entirely cancel the subscription. However, be aware that some subscription-based services may have different terms and conditions than the ones discussed in this article.

Types of subscription-based business models

Sampling subscriptions

It is usually a subscription box filled with sample-sized products. The company carefully selects the products and offers the best or the most suitable ones.

Bargain subscriptions

Customers sign up to receive products at a bargain price with the possibility to pause or cancel the subscription anytime they want.

Consumables subscription

This model of subscription services offers products that are used on a daily basis, such as food, flowers, diapers, etc.


As the world around us is constantly changing, people and businesses are adjusting as well. People tend to be rushing everywhere, getting impatient very easily, so they want businesses to serve at their convenience. Modern business owners have to consider that and adapt to the ever-changing contemporary world. One of the solution for the e-business owners is to start offering various subscription-based services which the millennials crave.

Migle Lauciute is a marketing specialist at Cardinity, an online payment processing provider for various types of businesses. Always striving to keep up with the new trends in marketing, e-commerce and online payments and sharing insights and tips with the people in the same field. @Cardinity.


Product or Service Subscription stock photo by Julia Tim/Shutterstock