Subscription Marketing, the Pros and Cons

//Subscription Marketing, the Pros and Cons

Subscription Marketing, the Pros and Cons

From Netflix to Spotify, Amazon to Sky, subscription-based services have become commonplace for almost all aspects of the entertainment industry. As we approach the close of the decade, this model has been adopted by businesses in industries across a range of other sectors, with many surprise success stories emerging along the way. Artisan food boxes, make up, gym memberships and even physical media such as vinyl records have all successfully embraced the recent trend for subscribing, rather than purchasing single items. There are undeniably a lot of positives for businesses who use this model, but it’s not without its drawbacks. In this article, we discuss the pros and cons of using subscription-based services in your business:



Providing you meet your customer’s requirements and provide a good quality service, subscription-based services offer businesses a way to generate predictable, regular payments from a base of customers. Unlike selling single products, subscriptions work in a similar way to a direct debit or monthly bank transfer. If you continue to provide what your customers are asking for, they will continue to authorise this payment each month. For businesses, this is revolutionary and when managed correctly, adopting this approach can drive significant growth.

Fewer physical products

From both an environmental and financial perspective, the general public’s apparent acceptance of this new medium as a means of consuming much of their goods and services is very positive thing. DVDs, CDs and other old media can take up a lot of space and often creates large amounts of waste, too. Similarly, shipping costs, manufacture and packaging can all add up. A perhaps unexpected advantage of this development is that a luxury market for bespoke, physical products of a very high standard now exists alongside the streaming platforms. Vinyl records, for example, have enjoyed a considerable resurgence in the past decade and many music fans will happily pay for the physical version of an album they could easily access on a streaming service. Strangely, this has led to a situation where content creators such as musicians or broadcasters can now potentially earn twice as much for their work.

Customer Retention and Satisfaction

Streaming services allow for instant feedback. Something that was never possible for most people until around a decade ago. Users can react to your content in real time, offer positive or negative comments and ultimately, let you know exactly what they want. This allows you to refine your approach based on quality, accurate data, rather than relying on guess work. Something that many of the mobile phone, internet and streaming providers have embraced is the practice of offering disappointed customers incentives to continue their subscription. Rather than losing a customer entirely, offering them a reduced rate or even a period for free can pay off in the long run. Providing that your customer service and communications practices are up to standard, this approach offers a way of re-establishing trust with your subscribers.


It’s too much of a commitment for some people

When you present a potential customer with opportunity to buy one product, you are essentially inviting them to take part in a transaction that will begin and end in that moment. A subscription is different, there’s a sense of being “locked in” or obligated, which many consumers still find a little unnerving. One way of dealing with this is to make cancellation as simple and easy as possible, though in reality, this isn’t always easy to do. It can also be difficult for some people to switch their mindset from the idea of owning physical products or using things as and when they need them. Paying for a subscription means they feel obligated to use the service you’re offering, which is something several people don’t feel comfortable with.

The Novelty Has Worn Off

There are now more offers and requests to subscribe on our daily timelines than ever before. The word itself has become ubiquitous with content streaming and is also widely used in marketing emails now. It’s no longer enough to offer a token subscription service for the sake of fitting in or keeping up appearances. If you are going to use this approach to promote your own goods or services, you will need to make sure it genuinely offers value. Knowing that they are probably already paying numerous different companies on a regular basis, all businesses need to give their customers a good reason to sign up.

Competition is Fierce

No matter what industry you work in, if you are offering subscription services, competition is extremely fierce and only the people who occupy the top spots can expect to see any real benefit from this approach. Customers develop favourites very quickly and often stay loyal once they’ve made their choice. That means that unless you can genuinely compete with the quality of the largest, best established companies, you will be left behind. Larger companies can usually afford to run promotions such as free trials, discounts and loss leading offers without taking too much of hit. Smaller or less established business will not realistically be able to match the quality of value of the major players.


To an extent, subscription style services are unavoidable, and will no doubt become the norm for many businesses, but at this point, we are still in a transitory period. As this style of payment becomes commonplace, the need to offer outstanding quality and value for money increases. Providing you can cope with the management, logistics and additional work required to maintain a quality subscription service, it can be one of the most effective marketing strategies you can use. There are obvious exceptions to this and smaller businesses or those rely on selling higher priced goods or services will find it more difficult to offer this as an option. Similarly, those without the reputation or customer base will find this model very difficult to use as it relies on a solid foundation of existing, loyal fans.

2019-07-05T02:46:16-05:00July 5th, 2019|