Do you have commitment issues?
Ravin Checker, CEO, Synthesis Systems
Your personal life is not my business. I was referring to your customers. Do you have commitment issues with your customers?
The biggest boon of a subscription business is the simplicity with which any customer can subscribe and experience the solution. This also happens to be the biggest bane, too, as exiting the subscription is equally easy. In between the two lies the commitment; the longer the gap is, the more profitable the subscription business would be. Sounds simple enough, right? But it’s not actually that simple.
The majority of subscription businesses do a decent job at pricing their solutions, from free to monthly to quarterly and then annually (with two months free). They do an even better job of onboarding the customer with red-carpet welcomes, emails from the CEO, and many more enthusiastic communications. Assuming that the client is happy with the solution and using it every day, it is here that companies miss a key opportunity: understanding adoption. Surprisingly enough, I’ve realized from my conversations that not many subscription companies track the adoption rates of their solution.
It is only once the client leaves that they know about the attrition. Then goes an automated email that says “Sorry to see you go. Let us know the reasons for unsubscribing.”
In 2022, if there’s one thing that’s extremely important for subscription businesses, it is improving solution adoption/utilization rates. To rephrase this as a question, it is “How can you improve your solution adoption and maximize the value for your client?”
Why is this so important in 2022? With the subscription industry growing at a rapid pace, you are not alone in offering your products and services as an attractive subscription model. And, with the ever-growing variety of choices available, switching to different offerings is easier than ever before.
Having said that, customers do not have commitment issues when they’re getting the best value. It is you who needs to think if you are holding up your end of the bargain.
If you’re an engineer like me, here’s the equation you might want to write on your board:
Commitment = High Adoption + Superior Value + Great Experience
Check that and you are in for an awesome year ahead.
Wishing you a wonderful 2022.