Starting a Subscription Business: 4 Common Mistakes You Should Avoid
Subscription-based businesses have grown tremendously over the past decade. And with good reason! All it really takes to get a subscription business off the ground is technology, capital, and a great idea.
Unfortunately, all it takes is a few mistakes to sink your business. Here are 4 common mistakes you should absolutely avoid if you want to give your business a fighting chance.
Not Doing Research in Advance
Before you start your subscription service, you need to know it’s something your customers need or want. If you don’t, you’ll end up sinking capital into a business no one’s interested in buying from.
Start off by verifying that what your business is providing is an effective solution to a determined customer problem. You can do this by talking to potential customers, reviewing online forums, and checking search trends to learn about how people currently approach this problem.
Are there companies already offering this kind of product or something similar? Do a competitive analysis to better understand how they approach the problem and what their current audience looks like.
This can help you determine how you should differentiate yourself as a brand, and the basic features you should be offering to be competitive.
Not Caring Enough About Customer Support
When starting a business, it’s easy to focus only on acquiring customers and avoid customer support. But strong customer support is key to retaining customers and increasing their lifetime value.
If your customers have a poor experience and there is no customer service to address it, they’ll stop using your business and possibly become a big detractor of it.
Focus as much energy on customer success and support as you do on acquiring customers. And be sure to actively monitor customer accounts and check in on them to make sure they’re happy with your service.
Poor Pricing
Pricing is an easy thing to mess up when starting a subscription business. If your service is too expensive, people won’t buy it. But if it’s too cheap, you may struggle to break even and keep yourself afloat.
Reserve testing your pricing for during the development stage. Try pricing your service at a higher rate than you think is right. You might be surprised to learn customers value your product more than you thought.
Are you stressed about pricing or billing? Check out Billsby if you need help with your billing work!
Obsessing over Perfection
Starting a new business is never smooth sailing. Things will go wrong. You won’t nail your product or service immediately, nor will the pricing be right the first time around.
Don’t stress over these things so much that you delay your product launch. Instead, focus on creating your minimum viable product. This will help you invest your energy and effort where it matters most.
So, ready to start your business? Starting a subscription business can be difficult. But don’t let that stop you from chasing your dream! By avoiding these easy mistakes, you can start your business the right way and set yourself up for success.
