The inflated business model subscription model


Posted On Mar 3 2017 by

The third wave of

e-commerce officially staged, may have reached its peak. We saw the 2009 flash (the first wave) and the group buying in 2010 (the second wave). Now women’s clothing, handmade food, and even pet medicine can subscribe. In fact, more than 12 start-up companies have begun to follow the path of these three waves. The cost of this kind of company is very low, and the angel investment is also very abundant, anyone seems to be able to create a new site, such as subscribing to coffee?. What about tea? Whatever it may be…

The concept of

investors love circulation revenue, but taking into account the high turnover rate and lure customers pay in many business model’s ability to enhance customer loyalty is the kingly way. In order to understand why some sites can survive and others are disappearing, we need to consider three factors: the type of subscription model, the attributes of the commodity and the business strategy.

currently has three types of subscription models, each of which has its own particular value orientation.

the first type of subscription model is to provide customers with a certain kind of goods more affordable price, because people will always cycle purchase. We call this type of "Columbia House", one that has survived for a long time CD Direct Selling Company uses this subscription model. Why do customers join? They are attracted by the price of money and this mode ensures that they can cancel orders at any time in the future. If the customer does not participate will continue to repeat the purchase of certain commodities, of course, will also increase their lifetime value. Many of the companies that use this model have finally become professional fundraisers. Compared with the majority of non subscription mode of electricity providers, such as the cost of customer lifetime value model is easier to get high value customers. The risk, however, is that the customer is not a fool. When they see something they want to buy, they don’t necessarily want to join it, because they think it would be troublesome to cancel the subscription later. Others may have a bet on the mentality of joining. If I love circa 1994 of this album, I can join the B. O ‘Malley Brian O’, Malley, and B. Patrick O Malley subscription service, so that I can continue to receive free CD, if you see people for a free T-shirt will do what, you won’t feel this behavior to me surprised. Of course, this risk will make this type of company to make adjustments: for example, ShoeDazzle will no longer take this subscription business model, other footwear business companies such as ShoeMint, JustFab and Sole Society are the most original business model.

The second type of

is sample subscription. Send you some of their businesses selected that you will love the goods sample, because you almost don’t know what will be, we call this mode is called "Pandora’s box

Last Updated on: March 3rd, 2017 at 12:04 am, by


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