Subscription Models You Need to Consider

We’ve come a long way since the days when subscriptions covered only magazines and newspapers. From entertainment and fashion to consumer goods and meal kits, subscriptions have been steadily gaining traction in numerous industries for several years — and that includes restaurants and c-stores.

The model can be used in different ways.  One common example involves asking customers to pay upfront for services or meals redeemed later. For instance, Olive Garden’s Never Ending Pasta Pass is paid in advance, and then customers redeem their “pass” at every visit. 

But this is far from the only model available. The flexibility of subscriptions allows you to tailor your options based on your store or restaurant’s needs, then adapt your subscription quickly to take advantage of factors like seasonal preferences, customer interest, or promotion of higher-priced meals, services, or products. 

Four to Consider

Within the breadth of subscription types, there are four main models that can form the basis of a program:

• Item: This is based on a specific product or item, and it’s usually a minimal-cost loss leader that prompts additional purchasing. Although it may be a less expensive item, that doesn’t mean it can be anything. The more popular an item might be, the more this model works. For example, the MyPanera+ Coffee subscription from Panera Bread ties their program to one of the chain’s most-ordered items. That subscription also includes iced coffee and hot tea, to bring more variety to subscribers. 
• Free Delivery: This model can be used when delivery costs seem to be preventing purchasing or lowering sales volume. For restaurants, this might take the form free delivery within a certain radius. If a restaurant already has free delivery to some extent, a subscription can expand that territory while offsetting added costs. 
• Online Discount: As a way to encourage customers to use online ordering, a subscription service can make online discounts a central part of subscribers’ experience. This can be adapted based on percentage, dollar amount, or specific item. For example, those in the program might get a choice of free appetizers, 10% off every order, or a $25 “credit” that can be applied to online orders only. 
• Insider Perks: This model can be a hybrid that blends together several aspects of member benefits, such as free delivery plus online discounts, but with an emphasis on time-limited deals. Alternatively, it can offer modest discounts with occasional big advantages for subscribers only. The point is to make members feel like they’re part of an exclusive club, and rewarded for their loyalty.

Want to learn more about subscriptions? Download our ebook, Subscriptions: The Next Level of Loyalty for insights on why subscriptions drive loyalty and enhance differentiation, and how you can get started by launching your own program—with technology  that makes it easy.