How many streaming services do you subscribe to? How many products are on Amazon Subscription in your Prime Account? Do you subscribe to satellite radio? How about music streaming?
I think you get the point. We subscribe to everything. Subscriptions are as normal today as texting or drinking $6 versions of coffee that we can make for ourselves at home.
Subscriptions have a lot of appealing features to customers. In the U.S. Food and Beverage report by Attest, a consumer research platform, we learned that Of course, they also have a lot of benefits to the companies that offer them, not the least of which is a steady stream of income from its customer base.
In this episode, we explore the reasons why customer like subscriptions and how psychology influences these feelings. We also explain how behavioral sciences play a role there, too.
Key Ideas to Improve your Customer Experience
Many years ago, I subscribed to Amazon Prime to get faster shipping. As a result, I also get Amazon Prime streaming as part of the package, but it wasn’t the driving force behind my decision. Now, the irony is that I choose Amazon Day delivery to reduce how many shipping packages I receive. So, apparently, I no longer need the fast shipping, but I won’t cancel Amazon Prime because I don’t want to lose the streaming service. This example is not uncommon among subscribers. Loss Aversion is a significant influence on our behavior when we continue to subscribe.
Here are a few key moments in the discussion:
- 03:19 Before we get into the theories about why subscriptions work the way we do, we share some interesting examples of programs that are working, from phones to cars to…heated seats?
- 06:27 Colin shares some fascinating statistics revealed by Attest, a consumer research platform, in their latest Food and Beverage report.
- 11:14 Ryan explains the two perspectives regarding subscription services and what each of them likes best about it.
- 16:54 We discuss how Mental Accounting benefits from the lower installment pricing inherent in subscription programs.
- 20:33 We discuss the role of Loss Aversion in subscription service and how it can benefit organizations that offer them to customers.
- 29:17 We share our practical advice and what we think organizations should be wary of, or tragedy may ensue.
This podcast was done in partnership with Attest.
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Customer Experience Information & Resources
LinkedIn recognizes Colin Shaw as one of the ‘World’s Top 150 Business Influencers.’ As a result, he has 290,000 followers of his work. Shaw is Founder and CEO of Beyond Philosophy LLC, which helps organizations unlock growth by discovering customers’ hidden, unmet needs that drive value ($). The Financial Times selected Beyond Philosophy as one of the best management consultancies for the last four years in a row. Follow Colin on LinkedIn and Twitter.
Click here to learn more about Professor Ryan Hamilton of Emory University.
Why Customers Buy: As an official “Influencer” on LinkedIn, Colin writes a regular newsletter on all things Customer Experience. Click here to join the other 35,000 subscribers.
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