Let’s face it - life is busy and we’re all looking for ways to optimize our time. As a result, consumer buying habits are moving towards simple and hassle-free shopping experiences.
Many global brands are jumping into the subscription space and seeing incredible growth. Take a look at the success of Dollar Shave Club, they created a multi-million dollar business with exponential growth, which was ultimately acquired by Unilever for $1 billion!
Watch our webinars to learn how to manage, grow and scale your eCommerce business in 2018
We recently co-hosted a webinar with Bold Commerce - a company that builds apps on the Shopify eCommerce platform to help store owners increase their sales. In this webinar we discussed the benefits of having a subscription service on your eCommerce store, along with best practices on how to best utilize inventory and order management software.
Kevin Wild, who is the Head of Partnerships at Bold Commerce, started his presentation by discussing the value of subscriptions and how it is a great way to make more money for a business.
One time revenue is great, however, recurring revenue is better. We all know that having customers coming back to you over and over again is a better business model than a customer coming back once.
With today’s technology, it is easy to automate your subscription model and produce recurring revenue. Recurring revenue is consistent, reliable, forecastable, builds customer loyalty and improves their lifetime value (LTV). All 5 factors allow businesses to look ahead and know exactly how much revenue will be coming in the future.
The LTV of your customers is extremely important as it represents the value of each of your customers and what they are worth to you. If you are spending time and money acquiring new customers to buy from you, you need to understand their worth.
You need to know the value of your customers to you know how much to spend on trying to acquire them.
The LTV can be determined by using a simple formula:
Whatever LTV number you determined, make sure you are spending less than that when acquiring new customers to remain profitable.
Next Kevin discussed key subscription trends, including:
This is when a customer chooses their items from a predetermined list. This trend is most popular for food and meal plan businesses as it provides flexibility for customers.
2. Mystery Box
This is when a customer subscribes to a box where they don’t know what they will be receiving. It can be regularly available items or it can be limited edition items. This box provides a great customer experience, increases margins and it allows businesses to move more inventory quickly.
3. Membership / Club Style
This subscription is similar to a Costco-membership card where you pay a specific amount each month. It either grants you general or privileged access to a store. This is great for customer loyalty and brand building. It can also be integrated into an entire store and combined with another subscription offerings.
Mark Cohen, who is the Partnership Manager at TradeGecko, started his presentation by explaining common operational challenges commerce business face. These include being stuck on old systems with no paper trail, bad communication between teams and systems, overselling/underselling and painful audit experience for end-of-year. Next he went into detail about the TradeGecko solution.
TradeGecko act as the single source of truth to managing your entire backend operations.
In order to connect your end-to-end commerce workflows, it is important to integrate with key providers in the ecosystem:
Mark also discussed all of TradeGecko’s native integrations including:
As commerce businesses, we seem to primarily focus on the B2C side of things, however, the B2B market is actually 3 times the size of the B2C market.
TradeGecko and Bold Commerce work together so you can build the eCommerce business of your dreams. Automating your subscription, inventory and order management workflows will allow you to take your business to new heights!
Save time and money by signing up for a free trial of TradeGecko today!