Subscription or loyalty card's big brother
Loyalty is one of the main pillars on which retailers are working hard. One of the best-known tools appeared in the 50s: the loyalty card. Since then, the loyalty card has continued to evolve, evolving from a simple money-making tool to a genuine service offering (free delivery, specific discounts on certain products or departments, etc.).
Today, although still present, the loyalty card, which is most often free, is evolving towards another style: thesubscription, which is more often than not paying. We've all used subscriptions before (telephone, internet, electricity...). Now it's the retail industry's turn to offer its customers a range of services at all kinds of prices. The best-known of these is Amazon, with its "Amazon Prime" offer including free delivery, cloud services and VOD. Other examples include Casino, with its "Casino Max" subscription offering immediate discounts in stores and on the group's websites, and Monoprix, with its "Monopflix" offer featuring discounts and free delivery.
What are the benefits for customers?
Subscribers should feel pampered and privileged, with exclusive, personalized offers based on their purchasing habits. They should feel a sense of belonging and closeness to the brand.
What are the benefits for distributors?
- Have a regular, planned, monthly or annual income.
- Differentiate via a catalog of satellite services, like Cdiscount's 4-month subscription to Deezer: marketplaces losing ground post-Covid use subscription to stay in the "game".
- Increased profitability: that's what Decathlon 's new subscription formula is all about, allowing subscribers to rent sports equipment rather than buy it. This service enables the retailer to improve its margins by between 3 and 10 times more than a conventional sale.
- Develop repeat purchases. According to a 2021 Statistica study, Amazon Prime subscribers are more committed than non-subscribers. In fact, 20% of them say they buy several times a week, and 7% even buy every day. These customers also tend to have a higher average shopping basket. Knowing your customer's consumption habits through data collection means you can propose targeted, personalized offers. This is what is commonly known as "hyper-personalization". From now on, retailers will no longer focus solely on the products they have to sell, but above all on their customers' needs!
What are the links between subscription and omnichannel?
The range of possibilities becomes enormous when you combine subscription and omnichannel. The retailer is now able to offer subscriber customers the opportunity to :
- free home delivery or click and collect,
- benefit from point-of-sale discount offers on targeted days,
- receive invitations to private sales, tastings or other events directly in the store, to drive "traffic" into the store.
The in-store data collected will be used to target marketing and promotional operations much more precisely, via targetedCRM mailings, SMS messages or even push messages on the retailer's app.
Subscription and omnichannel still have a bright future ahead of them. It will be interesting to see how this evolves over the next few years. The mega-offer concept will certainly be a key element in retailers' strategies. Indeed, as price competition becomes increasingly fierce, the prize will go to retailers who are able to stand out from the crowd with a plethora of differentiating services.
By Rémi Garnier