Stop! Offer different subscription prices to consumers based on how much they already spend on other services.
So, you're doing great at selling your core service to your primary audience. People love what you are doing and often choose your service over other, similar services. But how are you reaching and converting people that are already spending money on similar or complimentary subscriptions? Or people that are just maxed out on other subscriptions in general? Like most subscription services, you have a few options…
1. Huge discounts for everyone.
This seems to be the most popular. While this can be effective, you're going to annoy your loyal subscribers already paying your base price. Annoyed subscribers start looking for those same deals offered by your competitors, which is less than ideal. To make things even worse, you may be underselling your service to people still willing to pay more than the low price you are offering to the masses. At the very least, you are temporarily devaluing your brand by flashing enormous price drops to just anyone. Conclusion: You can get more subscribers this way but the long term costs may be greater than the short term gains. Tread carefully.
2. Bundle.
As I'm sure you've noticed, a lot of brands are opting for the bundle option - charging a reduced rate for a bundle of simlar services. This can be worthwhile as the consumer gets to enjoy more (not all) of the services they desire and you get the benefit of the sale even though they might not really even want your service... But it's still a very limiting proposal (unless you want to create bundles with EVERY possible consumer combination preference…) and it still devalues your service to the entire public and cuts into your profits by allowing EVERYONE to pay less than they normally would. It's useful for attracting consumers, but it's really just a discount for everyone at large, including your existing subscribers already paying full price.
3.Free trials.
Free trials can be a good tool to have in your box. They typically have relatively high conversion rates and allow people to see if they love your service enough to join. Converting them at your base rate means less angry current subscribers. Psychologically, this appears less like a discount but, in reality, it is, in fact, a discount when you look at your LTV. At the end of the day, a free trial can be as costly as a discount depending on your pricing strategy and the average length of time your subscribers stay with your service. Keeping your free trial limited to 1 or 2 weeks reduces the "discount effect" of the free trial.
Overall, free trials can be hugely valuable, especially as you're trying to gain traction. They are great at acquiring new users but they still miss out on a large and growing swath of consumers - Those that value your service, but already own subscriptions to similar services they value more. For this class of consumer, it's becoming more and more difficult to justify paying full price for multiple services that offer similar content. At they end of the day, they will choose the one that they like the most and leave the other behind.
4. Offer consumers customized subscription prices
Now there's a fourth, more awesome option. With SubSuite you can customize subscription pricing by offering special rates to people based on how much they already spend elsewhere. How does it work? SubSuite pre-qualifies consumers for you by identifying how much they spend on all of their monthly subscriptions and further breaks down that spending by subscription category (streaming audio, streaming video, dating, news & media, gaming...) and even by brand. From there, our technology finds the best price (set by you) to serve up to each indiviaual consumer.
If someone is spending a lot on other digital subscriptions, why not offer them a small discount to add your subscription as well? If someone is spending a lot on similar or complimentary subscriptions, offer them an even better deal. If someone is spending a lot on two of your direct competitors, maybe make the discount even steeper. For everyone else, maybe you want to keep your base right as the offer price. It's all up to you. You create the pricing AND you define the audience. Each plan will only appear to consumers that meet the parameters that you describe. Create as many plans + audiences as you like to really maximize your returns!
Customization is key. Sell the right plan to the right customer every time. Maximize every sale and never undersell your service again.
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