Do you have a mobile phone, or cable or satellite TV? Do you stream music? Well, chances are, you’re familiar with a subscription-based purchasing model. And you’re not alone; billions of consumers worldwide are subscription customers.
In the business-to-business world, too, the subscription-based, or on-demand model, is increasingly common. In this environment, software is the most common example. Organisations often get software, such as accounting or customer relationship management systems, via subscription rather than purchasing a fixed number of licences. This enables them to work more flexibly, and ensures the very best ROI on their tech spend.
However, this new model can pose certain challenges when it comes to customer engagement as customers have less and less need to interact with sales staff. At the same time, subscription-based models require businesses to interact with customers more regularly in order to keep them buying.
What’s the solution for these businesses?
Conversations are taking place on digital channels – webchat, email, and even with peers on social media. If businesses want to stay competitive, these are the conversations they need to join. For example, think about those sneak peeks that we get via Facebook that invite us to listen to a new album, in the hope that we might subsequently make a purchase.
And thanks to social media, the customer community has more power and influence than ever, wielding the ability to either enhance or hurt a company’s reputation almost overnight.
Consequently, it is crucial that businesses embrace the social technology available and create dynamic customer communities, designed to help promote the brand and keep customers interested.
Businesses need to understand the nuances of the customer experience, regardless of channel. In understanding this, companies will be better able to engage in a far more personal, effective way.
For example, by using data from its customer relationship management system, an online software company could pick up that a particular company is growing at a fast rate. It would then be able to send this business customer discounts for additional seats based on this information.
Or, by using data from sensors embedded in customers’ MP3 players, a music streaming company might notice a particular customer had suddenly started listening to music at different times of day – the streamer could send samples of relevant tracks accordingly, whether upbeat music for an early morning gym session or calming background music for dinner.
We are just at the beginning of a bigger migration towards true digitalisation, where this level of understanding will inform every aspect of an organisation’s thinking. In fact, businesses will get so savvy at using data, they will actually be able to anticipate changing customer needs.
Subscription models are fast becoming the norm in our increasingly digital society, and the upshot is a much greater need for businesses to create active, two-way conversations with their customers. But to do this effectively there must be a deep understanding of the customer. Without understanding, there’s no foundation for a meaningful relationship.
Discover how you can find your path to success in the subscription economy, and Jumpstart Your Journey to the Cloud today.