How to Start your own Online Subscription Business in 2022 |
Leigh Metcalf, the founder of the Atlanta-based sewing company, Topstitch, was looking for ways to create an online community of stitchers. After the outbreak her, the necessity for an alternative way to conduct business ever more urgent.
The Answer?
An online community. She created an online stitching group for garment sewers using the internet, and now, her online subscription company has been growing rapidly - so much so that it's the sole current focus!
There's an abundance of individuals discussing different methods to create businesses online. Many talk about creating an online course up on Skillshare or dropshipping through Amazon, or flipping merchandise.
While each of them may serve a purpose, the online business model which is gaining the most attention is an online subscription that has a hint of community! In this post we'll explain the things you should be aware of if you're thinking about how you can start an online subscription business.
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This article...
1. What is an online subscription business?
2. Why start an online subscription company?
2.1. Recurring revenue
2.2. Scale
2.3. Long-term customer relationships
2.4. The effect of the network
2.5. Predictable growth
3. How to start an online subscription company in 5 steps
3.1. Refine your niche
3.2. Choose your monetization model & platform
3.3. Find your customers
3.4. Deliver value
3.5. Evaluate and adjust
What is an online-based subscription company?
A subscription-based online business is a product that provides a service or space where members are charged for access to regularly. The majority of subscription companies online sell 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 to the monthly shave clubs, vegetable delivery, or wine subscription, you've been a part of a subscription company.
Some businesses are even merging subscriptions on the internet with physical items, such as ArtSnacks Mix which delivers regular art supplies by mail but also offers access to an online community offering artistic classes, ideas as well as other services.
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Why start an online subscription business?
Recurring revenue
Without a doubt one of the main benefits to an online subscription business for solopreneurs as well as multimillion-dollar firms alike is the potential for increasing revenue that comes from recurring subscriptions.
Perhaps you remember the days when you would buy software like Microsoft Office in a box at the local computer shop, with access for the life of your personal computer. Nowadays, Microsoft, like many other corporations, has shifted towards a subscription-based model. The result is that you pay less up front however they will earn greater from customers over their lifetime - all thanks to their recurring revenue.
On a lesser scale there are many solopreneurs thriving from an online subscription business. There are many the examples we have within the Stories of Awesome.
Scale
Another major benefit of the online subscription model is that it offers you huge scale for an owner of a business. The content you create can be shared once and have it reach hundreds or thousands of people. For example, if you are creating content in an online forum, it will not have much significance for you if there are five people consuming it , or hundreds.
You still only create your content once.
Similar to any online class. You don't need to keep making a new course again. Selling a course on the basis of an online subscription requires a recurring fee to access.
Long-term customer relationships
A further benefit of subscriptions online is the fact that it places your company in the position of being able to have long-term relationship with your members and customers.
Unlike a traditional, transactional company having an online subscription means that you are building the foundation for a long-lasting relationship. It could be by joining of the online community, by sending an annual newsletter or using social media.
The importance of a long-term relationships with a member or customer to a business is incalculable. This gives you an enthusiastic group of people to try the latest products, receive feedback from, and upsell to.
The network effect
What we find valuable in communities online is what we like to refer to as the effect of networks. In essence, the network effect implies that the value you provide to the community member not only one-way.
In fact, when you establish a community-based subscription company, the members provide value to each other as also. They'll communicate with each and help one another out, and build lasting friendships. This all adds to the worth of your community, even with no more tasks.
Predictable growth
Not the last, and certainly not the least, starting an online subscription business can give you an easy and consistent growth. If your membership churn isn't too significant, you're pretty certain that any growth you accomplish in the next month will rest upon the foundation of what you've achieved this month. This means that you could even predict where your subscription business will be one year from now.
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How to begin an online subscription business in 5 steps
Refine your niche
If you have an idea of the areas you'd like to put your imagination The first step to building an online subscription business that actually works is to clarify your niche.
If you are looking to build communities on the internet, we provide a process that we call Community Design(tm) to aid in this process. The first step of Community Design(tm) involves trying to identify the ideal person to join your group. It is a person who has an issue which you could help.
In general, we suggest talking about potential members who would be ideal of your subscription service which is in this case, an online community. These interviews can help determine the problems which members face, as well as clear areas where they would prefer for assistance.
Once you have done these interview, you will be able to make what we refer to as the Large Purpose Statement. The format is as follows:
Choose your monetization model & platform
Next step, when you have identified who your ideal member is and the issue they face and the issue they face, is to select an approach to business that will effectively help them. In part, the choice of the business model you select will be based somewhat on the issues you're trying to solve. If you have teaching that needs to be done and you want to incorporate an online platform for courses. If you are able to offer an application that solves the problem, then you're probably building something altogether unique.
Because we are passionate about online communities, the website that we created is focused on subscriptions to community groups and offers different ways to monetize. It allows you to add online courses, paid subgroups or events. Additionally, you can combine all the above.
Select a monetization model that can help you serve your ideal client as you develop your company.
As you begin do not forget the KISS rule - that isto keep it simple... It's simple, right.
Find your customers
Next step is to determine the best way to attract new customers. There are lots of methods to accomplish this, therefore we will not discuss a universal approach. You need to figure out what will work with your desired group of members.
But at the very most, you could go back to the people whom you talked to and tell them that you are creating an online subscription service.
Use the tools you've got in your arsenal to search for other customers. These could include:
- Social media
- Email list
- Custom invitations
- Webinars
- Ads
- Trials for free
Deliver value
The process of bringing people into the room is just half the battle. Insuring they stay is the other part. So, once you've got some customers paying of your subscription online business You must begin offering value.
There's good news, if you did the effort to determine your ideal member, you can just give that person the things they require. That's what this Community Design(tm) process makes your business more efficient as you don't have to provide worth to different kinds of people that all have different needs.
Beware that volume is a good thing. Many people begin an online subscription company believing that their customers will be happy with an abundance of content. The creators get burnt out trying to provide it.
Instead, concentrate on the process your customers have to make and give them only what they need to make that take place.
Assess and adapt
Finally, make sure you constantly take stock of your current strategies and make adjustments. It's best to remain lean as your subscription company, so don't be afraid to make the changes that will help you serve your audience more effectively.
Conclusion
So now that we've walked through the process of starting an online subscription company The only remaining thing is to get started! And believe it or not it can be the hardest part. Many people dream of trying however, they suffer from an analytical paralysis and overthink to the point that they don't even take the initial step.
Do not be the person you are. Just get started! Even if you don't think you have all the answers, you'll be learning as you go. That's the beauty of this journey.
Are you ready to start your subscription business?