Brands Bake Novel Subscription Strategies Into Their Reopening Plans

Physical retailers are building digital bridges to alluring new hybrid experiences and adding value to recurring revenue offerings to keep the great reopening momentum alive.

Low-tech and no-tech approaches can do wonders when building (or rebuilding) a customer base that’s been scattered all over the landscape by the pandemic. Panera Bread is doing just that, supercharging its 5-month-old coffee subscription service with unlimited free coffee.

The summer-long promotion is open only to members of the unlimited MyPanera+ Coffee Subscription service, which normally costs $8.99 per month. Under the deal, members can order a free refill every two hours, any size, all day, every day. The fast casual restaurant chain is accepting signups until July 4, and the promo appears to end in early September.

Caffeine’s awesome power to energize recurring revenue is reflected in PYMNTS’ Subscription Commerce Tracker series, which recently profiled New York-based personalized coffee subscription company Trade Coffee.

“Subscription providers can benefit from developing a deeper understanding of their customers’ preferences,” the Tracker states. “Trade Coffee has found that its subscribers, who range in age from 25 to 40, want variety more than anything else. The company sought to personalize its experiences by developing a way for its subscribers to describe how they want their coffees to taste.”

Personalization and variety are known to add value and increase engagement for subscription services. Free trials are another time-tested technique getting a post-pandemic workout. To protect sales, many Software-as-a-Service (SaaS) vendors relied on extended free trials and special promotions, especially during the lockdowns. But PYMNTS research has found that nearly 28 million consumers plan to cancel at least one subscription this year.

“A flurry of subscription activity at the height of the pandemic is sure to trigger a corresponding wave of cancellations as restrictions lift, business hours resume and all those new monthly recurring charges get real,” according to the research. While that may likely happen, subscription commerce continues doing a brisk business in streaming entertainment (Netflix added a record 15.8 million new subscribers in the first quarter for example), sundry box services, and newer offerings like veterinary telemedicine subscriptions.

Regardless of the product, service or vertical, churn is the enemy of subscription services, and the pandemic has forced companies to rapidly rethink front-end loyalty and back-end payments. Involuntary churn, for example, can happen when a card-on-file expires. Proactive subscription management — increasingly via purpose-built platforms — are helping solve for this.

Voluntary churn is the thornier issue of the two, requiring predictive analytics that look for early signals of voluntary churn, allowing time to react accordingly with personalized offers.