Technology/Services

The Key to Repeat Sales May Lie in Subscriptions

Photograph: Shutterstock

What if customers paid you to be a part of a brand? Consider all of the new ways brands could incentivize these customers—to make an extra visit, try a new product or build their basket—if these consumers already committed to spending money with a certain brand before they ever set foot inside the door.

Subscriptions, once reserved for magazines and “of the month” clubs, have become a part of many consumers’ daily lives. Starting with the explosive growth of Netflix’s streaming service in the early 2010s, the subscription model has expanded to all manner of online services and is now making its way into brick-and-mortar establishments including convenience stores.

Subscriptions serve two purposes for convenience stores: promoting customer loyalty and driving pump-to-store traffic. Two of the most common c-store subscriptions in place today involve fuel discounts and free coffee.

RaceTrac provides a great example of an effective fuel discount. For a monthly fee of $2.49, customers save 10 cents per gallon on their first 40 gallons each month and then 3 cents per gallon thereafter. The value is easy to grasp—customers need only purchase 26 gallons per month to achieve a cost savings. Knowing this, subscribers will be more likely to fuel up at RaceTrac because they have already invested in the brand and benefit financially from remaining loyal.

Meanwhile, other brands offer in-store subscriptions on top-selling items like coffee. For $25 per month, Cumberland Farms’ subscription includes up to two cups of coffee per day. Customers who commit to this recurring fee not only are incentivized to choose Cumberland Farms over more traditional places like Dunkin’ and Starbucks, but also might opt to go into the store for a pick-me-up after filling their tank.

The success of a subscription program heavily depends on how well its value is communicated. Done properly, subscriptions can be wildly successful at engaging new customers and driving incremental visits.  

Plus, customers who perceive a cost savings are more likely to make an additional purchase. Panera Bread, which launched a coffee subscription program earlier this year, said in July that the program had boosted guest frequency by more than 200% and food attachment to coffee orders was up 70%.

With proven results like these, it’s clear that subscriptions are more than just a trend. Much like contactless and virtual experiences, they have become an expected offering among consumers. 

This post is sponsored by Paytronix

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