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Achieving Success With Subscription Apps

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In 2016, Apple shifted their focus to “heavily favor” subscription apps versus in-app or one-time purchases. With subscription apps, somewhat than paying as they go, clients could make a month-to-month or annual cost to entry all of an app’s content material. Subscription apps might also be tiered which means a sure subscription threshold offers entry to sure content material whereas a better value might present entry to extra, “exclusive” content material.

Today, subscription apps are proving to be fairly worthwhile. In 2020, in response to TechCrunch, “…global subscription app revenue from the top 100 subscription apps (excluding games), climbed 34% year-over-year to $13 billion, up from $9.7 billion in 2019.” Why are subscription apps taking off and how will you guarantee your subscription app is profitable? What are the important thing elements wanted to create a great buyer expertise that delivers on expectations after charging a month-to-month or annual payment? Let’s get into it.

Why Subscription Apps Work

While in-app and one-time app purchases might give attention to new consumer acquisition, subscription apps are tied extra carefully to retention. Rather than introducing new options or content material as a consumer experiences your app, the consumer is offered with all the content material (or, no matter is on the market of their subscription tier) after their month-to-month cost.

Say a consumer made an in-app buy then realized they weren’t within the content material. That’s the place their journey ends. They spent the $4.99, or no matter chances are you’ll cost in-app, after which uninstalled your app. With a subscription nevertheless, if a buyer pays a $4.99 subscription, they now have entry to your content material for the following month. Why would they uninstall your app in the event that they’ve already paid?

Take Netflix, for instance. Users pay a month-to-month subscription payment and are given entry to all the content material on Netflix. If the service was free however some exhibits or films required a cost, it may deter customers from watching that premium content material or, worse, deter them from utilizing the service altogether. With Netflix’s subscription, there aren’t any surprises. It’s a set payment that reoccurs each month—easy, simple, and retains clients. But, it’s not at all times really easy to create a profitable subscription app.

Challenges of Subscription Apps

Subscription apps can pose some challenges for manufacturers. Why? No one stated buyer retention is simple. Once you have got the shoppers as subscribers, the problem is retaining them engaged and persevering with to resume their subscription. With in-app or one-time purchases, you possibly can throw all of the bells and whistles at a buyer to get them to make a single buy. With subscription apps it’s essential be innovating and including options to maintain clients from canceling.

Not solely are you consistently tasked with assembly (or exceeding) buyer expectations, you’re additionally battling subscriber burn-out. As YouAppi places it, “Customers who frequently sign up for these types of apps may be tired of paying for subscriptions or simply might need to downsize their monthly expenses.” You don’t need to be one other month-to-month cost on an extended listing of different subscriptions.

And, lastly, churn doesn’t disappear when you have got a subscription app. Yes, it could take a bit longer, relying in your renewal cycle, however it’s nonetheless very current. If a buyer pays a month-to-month payment and isn’t getting what they want out of your subscription, they’ll cancel. They should have entry to your content material till their subscription ends after which, that’s it. Once their month ends, they’ll uninstall your app similar to they might one which has in-app or one-time purchases. So what are you able to do to make sure subscription app success?

How to Overcome the Challenges

When you go to an ice cream store and are taking a look at all of the flavors, however you’re undecided which to get, what do you do? Ask for a pattern. If the pattern is sweet sufficient, you’ll get an entire cone-full. Think of that preliminary thimble of ice cream as a subscription trial.

We’ve all signed up for a “two-week trial” sooner or later. We get entry to a few of what the app has to supply—a.okay.a. “freemium”— after which, on the finish of two weeks, we’re charged and get entry to extra content material. Trials are an efficient approach to give clients a preview of your subscription app so persuade them to turn into a subscriber. However, throughout these two weeks, it’s essential make certain your app clearly demonstrates subscriber advantages.

With a freemium subscription, you must also intention to supply an in depth onboarding expertise. Demonstrate how one can use the app and present the client all the options they might get with a paid subscription and why these options are useful. Tread evenly. The trial interval is extremely delicate—any frustration or friction in the course of the onboarding course of may instantly persuade the client to cancel.

Lastly, use advertising channels to teach and interact the client. With an app you have got entry to cellular advertising channels like in-app messaging, cellular inboxes, and push notifications. Each of those channels, plus non-mobile like email or junk mail, can be utilized to create a harmonized expertise that retains the client engaged. For instance, possibly throughout onboarding you ship a collection of push notifications that spotlight numerous options of the app.

Deliver Value to Build Relationships

Subscription apps have the potential to extend buyer lifetime worth (LTV). By accumulating a month-to-month payment, you’ll have the ability to higher predict general income but additionally higher perceive your clients and what they want out of your app to remain subscribed.

Don’t ignore the information you possibly can acquire simply because a buyer has signed up for a month, a 12 months, or 1 / 4. Every interplay a buyer has together with your app is a chance to be taught extra about how one can ship worth that meets their wants. Keep subscribers completely satisfied through the use of their knowledge to create tailor-made, in-app experiences.

To be taught extra about bettering your clients’ cellular experiences, schedule an Iterable demo at this time.


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