We have talked about how ecommerce growth can be achieved post BFCM in 2023. but what about making holiday subscriptions an appealing gift? This strategy can not only give your subscribers the opportunity to gift their favorite products and boost repeat purchase rates but can also help you capture new customers during the busy holiday season. Holiday subscription gift guides are an excellent idea to boost both store health and customer retention.
In 2022, subscription merchants saw 11% year-over-year growth in average order value, 12% in customer lifetime value, and 7% in monthly recurring revenue know more via the Recharge 2023 State of Subscription Commerce Report.
This blog post will explore the benefits of holiday subscription gift guides and how merchants can sell their subscriptions as gifts. We will also discuss subscriptions in general and the reason why brands should offer holiday subscription gift guides.
Brands offering subscriptions grew 26% faster and were 14% more profitable than those that didn’t. It makes total sense. You have a growing, engaged community of people who love their subscription, and naturally, you get all the ingredients that help you grow faster: more reviews, more word of mouth, more content, more social proof, etc.
Offering holiday subscription gift guides can help merchants capture new customers during the holiday season. Bundling products together is a great way to create curated gift sets for your customers.
Why subscriptions at all?
On average, 30% of revenue is driven from subscriptions for brands that offer it – that’s huge. It swings depending on the vertical of the brand and the stickiness of the product, but knowing every month that you can rely on 30% or 40% of your revenue to just come in is really nice.
Reasons a brand should offer holiday subscription gift guides:
i. Predictable revenue. There is no truer statement as to why a subscription exists. The #1 reason people love subscriptions is you know exactly how much money you already have coming in the next month. It’s money you don’t even have to think about, you just know it’s on its way!
ii. New data set of high LTV customers. There is a lot of high-quality data to extract by looking at subscriber behavior. The subscriber base is also a great data set for product launches, product sampling, surveying, etc. They are your “high rollers”, so as long as you build a brand that keeps high rollers happy, you are winning. Crafting strategies that are subscription centric help further strengthen customer lifetime value ( CLTV) and grow margins.
iii. The lifestyle around the product fits into a routine. These are brands like Ritual, Pill Club etc. Telemedicine, as well as products that fit a timeline, are usually in this category. If it doesn’t fit into regular routine, then those products might fit here that customers want to make sure they’re always stocked up with.
iv. Customer convenience: With stressful and time constrained lifestyles and an unpredictable economy which is a reality today, customers seek convenience to save both time and money.
v. Community building. Your subscribers are also your most engaged and VIP customers, and there’s a high chance they have a lot in common with each other. As a brand, facilitating a community for others to connect is the best social proof for any new customers.
To learn how to reduce subscription churn for DTC stores read more here
How do holiday subscription gift guides work?
There are a few different ways that merchants can offer gifting options, which we’ll cover below. The important thing for merchants to consider is that they need to think through their customers’ eyes when creating gift subscription options. If you were to gift your product or service to a friend or family member, what options would best serve you? How would that look? And are there any special touches you can offer to those choosing a gifting option?
Benefits of creating holiday subscription gift guide options?
Offering gift options can benefit your subscription business in the long run. The holiday season is one of the best times of the year to capture new customers. With subscriptions, your business will keep those customers around into the next year. Here are some of the top benefits of creating gift options for your subscription business:
-Allow your existing subscribers to gift their favorite products
-Capture new customers, at a time when many consumers are shopping
-Continue building customer relationships long past the holidays
-Reach new customers without putting in a lot of money for customer acquisition
Learn more about Smarte Digital Lifecycle Marketing Services here
Learn more on how to create holiday magic for your DTC store here
Smart add-ons for subscription businesses:
i. Loyalty program. Someone is already showing you they are going the extra mile with you, not just buying once. Reward them! A good chunk of people will never care for your loyalty program, but it’s an easy add-on if you already have a subscription going
ii. Surprise & delight program. If you understand when a customer is likely to churn, and you’re able to implement a surprise and delight program to sustain their membership, you can reduce churn significantly. Check out the “At Risk of Leaving” part of this article.
iii. Exclusive subscriber-only benefits. This is an easy one and a win-win-win. Brand A gets to offer something exclusive to its customers. Customers of Brand A get a discount to try something adjacent or complementary to Brand A. Brand B gets customers for the cost of a 20% discount on gross revenue. This makes your VIP subscribers feel special resulting in reduced churn and increased customer satisfaction.
Creating gifting options with holiday subscription gift guides:
There are a few different ways that merchants can offer gifting options this holiday season. Whether you’d like to create a curated gift box or keep it simple with gift cards, you’ll be sure to delight both new and returning customers.
Let’s explore the various ways you can offer gifts this holiday season:
i. Gift cards are always a good product to consider, giving the gift recipient the opportunity to choose what they’d like is a great strategy to offer
ii. Prepaid subscriptions make it easy for the gift giver and recipient. Offer your subscriptions as prepaid options for a set time period, and let the gift giver choose the best one for them
iii. Curated gift boxes make use of bundling and take the work away from the gift giver by offering a collection of products already placed and purchased together.
iv. Other gift sets follow the same idea by using product bundling, but don’t necessarily need to be as elaborate as a gift box. Place complementary products together as a set and watch your average order value soar.
Learn more on how to dominate the holiday returns game for your store here
Examples of Holiday Gift Subscriptions:
1.For new parents: hellobello.com focuses on providing favorite gifts to give new parents. Make their lives easier with a diaper bundle or a kit of baby-friendly products.
2. For the tea connoisseur: smithtea.com is made for the tea connoisseur – gift them a tea subscription at smithteasubscriptions, to ensure they always have a cup of hot tea in their hands this winter. Gift a subscription allows you to gift a 3 to 6 month subscription to your family and friends.
3. For the health and beauty enthusiast: blume.com provides a gift of self-care. Choose from one of their holiday bundles for the skincare-obsessed friend in your life!
Best Subscription Martech Out There!
Recharge: Leverage the leading solution to build and scale your subscription revenue. Recharge powers over 50 million subscribers across the globe.
If your objective is to increase repeat purchases (LTV), leverage the in-cart subscription conversions feature via Smart Cart. Brands that have embraced this feature are Magic Spoon and Moon Juice. In checkout product recommendations allow increase in AOV. Brands that have embraced this feature are getkion.com.
Recharge subscriptions include a multitude of built-in features, including a robust customer portal, actionable analytics, and agile transactional SMS tools.
-The highly requested GIFT SUBSCRIPTIONS functionality is now live, just in time for the holidays!
-Empower shoppers to gift subscriptions without 3rd party integrations, custom development or compromised UX with Recharge.
–Grow revenue through gifting – this can represent up to 80% of sales order processing during peak sales periods like holidays and BFCM.
–Increase loyalty – expose new customers to products by allowing existing customers to act as brand advocates.
Smartrr : is the subscription platform built for Shopify merchants, which was built with an understanding of why legacy subscription software absolutely sucks. Smartrr was built with the end consumer in mind. With Smartrr, brands see 2X subscription revenue in the first 60 days, 94% average monthly subscriber retention and 70% decrease in customer support tickets.
Yotpo Subscriptions:
Allows you to empower your shoppers to own their subscriptions experience. If brands don’t offer flexibility and easy subscription management they break the trust that they’ve built with their customers.
And because it allows brands to grow and accelerate their business by optimizing the entire customer journey, turning shoppers into loyal subscribers.
Smarte Digital Inc. is a ecommerce retention marketing agency for modern DTC brands. We are certified agency partners with Recharge, Yotpo and Smartrr. To learn more about our subscription offering read more here Smarte Digital Inc – lifecycle marketing subscription solutions
At Smarte Digital Inc. we offer irresistible Q5 holiday offers that will help you and your team get to a winning start in 2024. To know more, book a free 30 min introductory call with us at https://www.smartedigital.com/contact-us
