How to Begin your own Online Subscription Business in 2022 |
Leigh Metcalf, the founder of the Atlanta-based sewing company, Topstitch, was looking for ways to create a community of fellow stitchers. After the outbreak and the demand to find a different way to run her business was ever more urgent.
What is her answer?
An online community. She created an online stitching group for garment sewers using technology, and her online subscription business is booming - so much to the point that it's her sole attention right now!
There's an abundance of people talking about different methods to create businesses online. There are discussions about putting online courses on Skillshare or dropshipping through Amazon, or flipping merchandise.
Although each may serve a purpose however, the model of online commerce that's really dominating is online subscriptions, and a bit of community! In this piece we'll discuss the things you should learn if you're looking for ways to begin an online business for subscriptions.
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This piece...
1. What is an online subscription business?
2. Why start an online business for subscriptions?
2.1. Revenue recurring
2.2. Scale
2.3. Customer relationships that last for a long time
2.4. The network effect
2.5. Predictable growth
3. How to start an online business of subscriptions in five steps
3.1. Refine your niche
3.2. Choose your monetization model & platform
3.3. Find your clients
3.4. Deliver value
3.5. Evaluate and adjust
What exactly is an online subscription business?
An online subscription business is an online product, service, or space that members are charged for access to regularly. Online subscription businesses usually either offer access to a digital product or service, for example, an online class or software OR to an online community.
The business of online subscriptions is a subsection of the wider business of subscriptions that is booming. If you've ever signed-up for a monthly shave club as well as a vegetable delivery service, or wine delivery, then you've been a part of a subscription company.
A few companies are making a connection between online and physical goods, such as ArtSnacks Mix which delivers regular art supplies by mail , and also allows access to an online community, which offers artistic classes, ideas and more.
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Why begin an online subscription company?
Recurring revenue
Without a doubt the most significant benefit of an online subscription service for solopreneurs and multimillion dollar firms alike is the potential for recurring revenue.
You might remember a time where you bought programs like Microsoft Office in a box from the computer store, and have access to that all the time you owned your computer. Now, Microsoft, like many other businesses, is shifting to a subscription model. The result is that it costs less upfront and they make higher from each customer throughout their lifetime - all thanks to recurring revenue.
In a less granular way, many solopreneurs are also thriving from an online subscription business. You can read examples of these in the Stories of Awesome.
Scale
The second huge advantage to the online subscription model is that it provides enormous scale as an owner of a business. It is possible to create something one time and it can reach hundreds or thousands of users. In the case of, say, if you're creating content on an online forum, it will not make much of a difference to you if five people consuming the content or hundreds.
You still only create the content one time.
Similar to the online courses. There is no need for creating a course over and over again. Offering a course through the basis of an online subscription involves incorporating recurring payment to access.
Relationships with customers over the long-term
Another huge benefit to an online subscription business is that it puts your company in the position of being able to establish long-lasting relations with members or customers.
In contrast to a transactional, traditional company online business means that you are building an ongoing relationship. This might be through membership to the online community, by sending periodic newsletters, or using social media.
The value of a long-term relationships with a member or customer to an organization is unimaginable. It gives you a willing group of people to try new products with, gather feedback from, and then upsell to.
The effect of the network
The value that we see in communities online is what we describe as the effect of networks. The network effect is the value you provide to a community member is not only one-way.
Actually, when you create a community-based subscription business, members deliver benefits to one another well. They'll communicate with each and help one another in need, and develop lasting relationships. This all adds to the worth of your community, even with no more tasks.
Predictable growth
Last, but definitely not last, starting an online subscription business will provide you with certain and steady expansion. Basically, as long as the churn of your members isn't overly significant, you're sure that any expansion you achieve in the next month will rest on the shoulders of what you've achieved this month. This means that you can also predict what the subscription service will be a year from now.
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How to begin an online business of subscriptions in five easy steps
Refine your niche
If you have an idea of the areas you'd like to put your imagination first step towards creating an online subscription company that actually works is to identify your market.
In the case of building online communities, we teach an approach we call"Community Design(tm) to aid you do this. One of the initial steps in Community Design(tm) involves trying to identify members who are ideal for your group. Someone who has problems that you can help with.
We generally suggest speaking about potential members who would be ideal for your subscription business which is in this case, an online community. Utilize these conversations to discover the issues that members have, and identify areas in which they'd want to get some assistance.
After you've completed these interview, you will be able to create what is known as the Large Purpose Statement. It looks like this:
Choose your monetization model & platform
The next step, once you know who the ideal customer is and the issue they have and the issue they face, is to select a business model that will assist the person. Partly, the type of business you pick will be based somewhat on the issues you're trying to solve. If you have teaching that is required and you want to incorporate a course platform. If you are able to offer an application that solves their challenge, you are most likely creating something entirely distinct.
Because we are passionate about online communities, the website that we created has been designed around community subscriptions however, it also offers many ways to earn money. There is the option of adding paid subgroups, online classes as well as events and much more. Additionally, you can combine all the above.
Choose a model for monetization that can help you serve the ideal customer as you develop your company.
When you start do not forget the KISS principle - that isto keep it simple... It's simple, right.
Find your clients
The next thing to do is to decide what you can do to attract clients. There are many methods to accomplish this, and we'll not talk about a one-size-fits-all approach. It is important to determine the best approach for your ideal participants.
However, at most, you could return to those whom you talked to and let them know that you're building an online subscription business.
Utilize your tools in your arsenal to search for other customers. This could include things like:
- Social media
- Email Lists
- Custom-designed invitations
- Webinars
- Ads
- Trials for free
Deliver value
Getting people in is part of the struggle. Keeping them there is the other part. This is why, when you have some paying customers for your online subscription business You must begin offering the value.
There's good news, if you did the effort to determine the ideal customer You can simply give that person the things they require. This is that's why this Community Design(tm) procedure makes your business more efficient as you don't have to offer worth to diverse people that all have different needs.
Do not think that volume is a good thing. Many people begin an online subscription company thinking that clients are satisfied with an abundance of content, and creators become exhausted in trying to deliver it.
Instead, focus on the change your participants are trying to go through and offer them the only resources they'll need to make that happen.
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Also, ensure that you regularly review what is working and adapt. It is in your best interests to stay lean in an entrepreneur in the subscription industry, and do not be afraid to implement those changes to assist you in serving your customers more effectively.
Conclusion
So now that we've walked through how to start an online subscription business, the only thing left is to start! And believe it or not it can be the most difficult aspect. There are many who dream of it and fail, only to suffer from analytical paralysis and overthink until they don't even take the initial step.
Be a better person than that. Just get started! Even if you don't have it perfectly figured out, you'll be learning as you go. It's part of the charm of the trip.
Ready to launch your subscription business?