Subscriptions can be an incentive for new customers. When set up correctly, they provide more reliable revenue streams, and improved scalability for product management. However, your sales team must be set up for success.
Subscription services – including recurring orders, shipments, and billing – present a huge opportunity for B2B enterprises. According to Gartner, “buyers and suppliers increasingly prefer subscriptions – both consumption and term-based – so Chief Sales Officers (CSOs) must engage and reward sellers to offer the type of subscription model in demand.”
eCommerce was thriving directly before 2020, but few could have predicted how quickly business and consumer trends would transform. The pandemic forced different purchasing behaviors which are continuing: data shows a 115% growth in B2B trial subscriptions, a 79% growth in software, and a 45% acceleration in eCommerce.
Subscriptions swiftly evolved as forward-thinking B2B companies began to expand marketing and support, promoting new formulas to encourage the enticing, long-term relationship with the customer. Rather than settling for that one-time purchase, subscription vendors control and manage ongoing sales, with technology streamlining the process.
“Examples of B2B subscriptions include continuous-replenishment inventory models, financial data subscriptions, and per-per-click data searches,” states Gartner. “Buyers often prefer subscriptions, because they limit upfront costs, and expense accounting moves from capital expenditure to operating budget.”
B2B subscriptions can apply to:
Subscriptions can be an incentive for new customers. When set up correctly, they provide more reliable revenue streams, and improved scalability for product management. However, your sales team must be set up for success. This includes understanding subscription pricing, knowing how to set up and manage subscription services for accounts, as well as training and educating B2B accounts looking to manage their own subscriptions.
As anyone with a subscription service has experienced, it’s not a ‘set it and forget it’ process. There are opportunities to upsell and cross-sell, introduce new subscriptions, and manage changing needs and demands.
“A subscription is a pricing tactic. By itself, it’s not a strategy. To build a recurring-revenue business, an organization needs to change how the product is designed, move from customer support to customer success, and keep the customer’s long-term well-being in mind across every functional area. Most of all, the sales team needs to be invested not just in the initial transaction but the ongoing relationship with each customer,” reminds HBR.
Sales organizations should plan for these changes, implementing:
Introducing a subscription program to B2B customers is an excellent way to strengthen, maintain, and retain the customer connection. You’ll need enterprise-ready solutions to support the complexities of managing B2B subscriptions. Some of these subscription processes may be maintained on the website or eCommerce site – or they may be operating in the backend system where the sales department is keeping track of subscriptions and managing them from that location.
Businesses providing subscriptions must ensure their technology stack is built to handle the substantial demands. This begins with a comprehensive database and automation to oversee invoicing, and inevitably, collections processes. The sales department must be able to manage different tiers of pricing, relying on an automated system for the configure, price, quote (CPQ) system, applying discounts depending on specific customers, annual up-front or bulk purchases, and more.
The key is to make the process a positive one rather than a headache, managing technological logistics for subscriptions and expected options; for instance, customers should be able to pause or skip months of their subscription if needed, as well as have the choice to come back. It should be easy for customers to manage and update their account information while knowing it is secure.
Customization is important to the process, as well as being able to analyze, track, and report the results of the subscription program. Team members should be able to work within the system easily – and most of all, the customer service experience should be positive.
Many businesses realize the need for one central management platform that can handle all the needs of B2B subscriptions, including specific features like:
Embracing this element of digital transformation requires examining other complications like reseller channels and some of the hassles associated with handling legacy platforms. B2B organizations require a strong eCommerce platform to master the subscription market and provide the necessary flexibility–especially in replacing enterprise resource planning systems.
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