Whether it’s the launch of a new membership program or a business acquisition, several direct-to-consumer (DTC) subscription brands made headlines in September, including lululemon, Peloton, and Adobe.
If you’re in the process of refining your holiday season game plan, then there is a lot you can learn from each of these business’ latest initiatives.
Read on to discover how last month’s subscription news can help you maximize your sales this year and beyond.
Memberships are Bringing Consumers and Brands Together
In September, both lululemon and P.F. Chang’s launched new memberships to strengthen their relationships with customers and increase the value of their existing offerings.
lululemon Introduces a New Platform and Memberships
Additionally, the company is launching the lululemon Essential and Studio memberships: The Essential membership is free and includes shopping deals, access to community events, and select Studio classes. The Studio membership is $39/month and includes the Essential perks in addition to various merchandise and class discounts, unlimited Studio access, and more.
These memberships enhance the lululemon experience while the new platform meets its evolving customer needs, stated Nikki Neuburger, lululemon’s Chief Brand Officer, in the press release.
Implementing a membership program can increase the value of a brand’s offering and foster customer loyalty, as purchases from customers that are part of such a program increase by 100%, according to Harvard Business Review.
Focus on understanding your subscribers’ needs and tailoring your offering to fulfill them.
P.F. Chang’s Adds a Paid Subscription Tier to its Membership
Restaurant chain P.F. Chang’s is also focusing on meeting its customers’ needs through its reimagined membership program. Launched on September 28, P.F. Chang’s Platinum Rewards costs $6.99/month and focuses on creating additional value through upgraded rewards, free delivery service, priority reservations, and more.
“The new subscription-based program is a continuation of our goal to create differentiated experiences for P.F. Chang’s customers, and we believe P.F. Chang’s Platinum Rewards does that at the highest level,” said P.F. Chang’s CEO Damola Adamolekun.
An efficient way to upgrade your offering is to leverage aspects of the subscription value stack: Curation, replenishment, and access. The best subscription businesses strive to provide all three, according to Bold Commerce.
Adding a membership to your subscription offering will empower you to give more access to your customers while still investing in your curation and/or replenishment model.
The Benefits of a Partnership
“This partnership is a natural fit for our brand and our Member acquisition goals,” said Jen Parker, Peloton Senior Vice President of Global Direct Sales. “DICK’S is a consumer-beloved brand with a large, incremental customer base, offering tremendous upside for us to reach broader audiences and attract potential new Members.”
Those that purchase Peloton products from DICK’s will still receive the expert setup and delivery services from Peloton, and some purchases are available for store carryout. By prioritizing the brick-and-mortar experience, Peloton is looking to appeal to a wider audience and continue recovering from its past struggles.
Once you narrow down your audience’s needs, determine how you can leverage other businesses to enrich your customers’ experiences, whether it’s by implementing new ways to sell your product or enhancing your current programs. It’s important to keep in mind that a successful partnership should benefit both parties, so be mindful of what’s in for the brand you want to team up with moving forward.
Hyper-Focused Subscription Raises $1+ Million
CarpeDM, a Washington D.C.-based dating app, appeared in subscription news after announcing that it raised $1.054 million in a pre-seed funding round.
Through personalized, video-first matchmaking services, CarpeDM is reimagining the way Black women and those looking to date them connect and start relationships.
“Online dating is time consuming and not built with Black women in mind. So we created a dating service that puts our needs first,” said Co-Founder Naza Shelley in the press release.
While other matchmaking services focus on larger audiences, CarpeDM’s focus on a specific demographic is proving to pay off. If you have a broad target audience, consider niching down.
You will have less competitors to worry about, more chances to connect with prospective subscribers, and foster a supportive, loyal community. As Sarah Williams of Launch Your Box explained at SubSummit 2021, “Riches are in the niches!”
Consumers are Cutting Out Streaming
While subscription video on demand (SVOD) recently surpassed cable, a new study reports that U.S. consumers are cutting out streaming services from their expenses.
quantilope, an automated consumer research company, found that nearly 30% of American and British consumers are thinking of cutting their TV/video streaming subscriptions compared to almost 20% of Germans.
Canceling streaming services and instead choosing free options, such as Peacock’s free tier, is one way that consumers can stick to a budget, according to the press release.
Consumer behaviors are constantly shifting. Keep an eye out for important changes that will impact your business.
Try surveying your subscribers on a monthly basis to proactively identify their needs and pivot accordingly.
Figma alone is expected to add close to $200 million in annual recurring revenue in 2022, according to Adobe’s investor presentation.
“The combination of Adobe and Figma is transformational and will accelerate our vision for collaborative creativity,” said Shantanu Narayen, Chairman and CEO of Adobe, in the press release.
It’s important to know why you want to sell your business and what you’re trying to achieve. Through the acquisition mentioned above, both Adobe and Figma expect greater success in 2023 and beyond. Being acquired does not necessarily mean being bought out, and it’s important to understand the distinction and when you should consider becoming part of a larger entity.
Staying Up to Date with Subscription News
This past month’s subscription news has shown that some of the biggest brands rely on the subscription business model to enrich their offerings and foster deeper connections with their customers.
In an industry expected to reach $900 billion by 2026, listening to your customers and providing them with what they need is crucial to succeed. Your subscribers have the power to generate extra revenue for your brand and take it to the next level.