From streaming services to meal kits and video games, subscription models are revolutionizing how we consume and experience products in the digital age. These recurring payment plans have quietly infiltrated nearly every aspect of our daily lives, reshaping industries and consumer habits alike. The reason is their convenience, cost-effectiveness, and ability to provide personalized experiences. While many of us associate them with streaming platforms like Netflix or Spotify, they have found usage in many more sectors, such as beauty and grooming products, fitness and wellness apps, software-as-a-service (SaaS) for businesses, and even subscriptions for car features like navigation maps and heated steering wheel. 

Taking this into consideration, today’s blog aims to describe everything that revolves around eCommerce subscriptions, including their types, benefits, examples, and ways to implement them in our own subscription business.

Quick jump

Types of subscription models in eCommerce

Let’s begin with saying a few words about the eCommerce subscriptions we can commonly find online.

Physical product delivery subscriptions

Think of it as your own personal delivery service, bringing goods right to your doorstep on a regular schedule. From everyday basics to special treats, these subscriptions are catching on all over Europe for things like food, drinks, and personal care products. It’s convenient, often saves you money, and you can usually change your orders or skip a month if you need to. It’s all about making life a bit easier and more fun.

Example: HelloFresh is a popular meal kit delivery service operating in multiple European countries, offering weekly subscriptions of pre-portioned ingredients and recipes.

Digital service subscriptions

Digital service subscriptions can be compared to a skyscraper with thousands of doors. By paying for a subscription, customers can get a “key” that unlocks a door filled with entertainment, productivity tools, knowledge, or anything else needed. In less philosophical terms, customers pay for a subscription to gain access to content, services, tools, and resources. 

Example: PlayStation Plus provides subscribers access to online multiplayer gaming, free monthly games, exclusive discounts, and cloud storage for game saves on PlayStation consoles.

Personalized product subscriptions

This model combines elements of surprise and personalization, delivering well-selected boxes of products to subscribers. These boxes often contain a mix of full-size and sample products, allowing customers to discover new items tailored to their preferences. In Europe, subscription boxes have become popular across various categories, including beauty, pet accessories, and lifestyle products. Many services use customer feedback and AI-driven algorithms to improve personalization over time, but more about that later.

Example: Sockbox (Netherlands) subscription service delivers unique, colorful socks to subscribers on a monthly basis. Customers can choose their style preferences (funky, classic, or a mix) and receive a surprise pair of high-quality socks each month.

General benefits of eCommerce subscriptions

Now, as we briefly describe the popular types of eCommerce subscriptions, let’s dive into the benefits that make them so popular in the modern world.

Steady, predictable revenue for sellers

First of all, subscription models offer businesses a consistent and foreseeable income stream, which is a significant advantage in the often unpredictable world of eCommerce. This steady revenue allows companies to more accurately forecast their finances and make informed decisions about investments and strategies for growth.

Building customer loyalty through regular interactions

Secondly, subscription services create frequent touchpoints between businesses and their customers, fostering long-term customer relationships. Regular interactions provide opportunities for businesses to continually demonstrate their value, gather feedback, and refine their offerings to meet customer needs better. Over time, this ongoing engagement can lead to increased customer loyalty and improved customer retention.

Easier resource management and sales planning

With a subscription model, businesses can more accurately predict demand, allowing for optimized inventory management and more efficient resource allocation. This predictability enables companies to better plan their supply chain, reduce waste, and potentially negotiate better terms with suppliers due to more consistent ordering patterns.

Convenience for customers, eliminating the need for repeat purchases

Subscription services offer customers the convenience of automatic deliveries or access to products or services they use regularly, saving them time and effort on reordering. This convenience factor can be a significant selling point, particularly for essential or frequently used items. Moreover, well-designed subscription services can often anticipate customer needs, ensuring they never run out of necessary products.

Key steps in implementing a subscription model 

Implementing the subscription model to the business may sound easy in theory, but in reality it requires careful preparation and planning. To make it less fuzzy, we’ve described the steps crucial for the successful implementation of a subscription model below.

Market analysis and selection of an appropriate subscription model

Begin with conducting thorough market research to understand your target audience’s needs, preferences, and pain points. Here, remember to analyze competitor offerings and identify gaps in the market. Customers are less likely to visit the store with popular child novels when dozens more already exist, right? Based on this information, choose a subscription model that aligns with your product or service and customer expectations. This could be a fixed-term model, tiered pricing, pay-per-use, or a hybrid approach.

Website and user experience optimization for subscriptions

Moving on, redesign the website to feature your subscription offerings. Create clear, encouraging landing pages that highlight the benefits of subscribing. Simplify the sign-up process by minimizing form fields and implementing one-click subscription options where possible. Ensure that pricing information and terms are transparently displayed to build trust. In addition, implement a user-friendly account management system that allows subscribers to easily modify their plans, pause subscriptions, or update payment information.

Personalization of subscription offers

Next, add a personal touch to the business. Leverage data analytics and customer insights to create personalized subscription packages. Offer flexible customization options that allow subscribers to tailor their plans to their specific needs. What’s more, consider implementing a loyalty system that rewards long-term subscribers with exclusive benefits or early access to new features.

Selection of appropriate subscription management tools

Last but not least, Choose robust eCommerce platforms like Sylius or Shopware that have the required architecture and flexibility to support subscription models. The chosen platforms should offer features such as recurring billing, subscription management, and reporting.

Building a subscription platform on top of Sylius & Shopware

Considering that, remember to integrate secure and reliable payment gateways such as Mollie that can handle automated recurring payments and provide options for multiple payment methods. Also, an efficient order fulfillment and shipping system (e.g., ShippingExport plugin by BitBag) should be implemented that can manage regular deliveries if the products are in the physical form. Lastly, consider other valuable third-party integrations like customer relationship management (CRM) tools to further improve the shopping experience.

The future of subscription models in eCommerce

Technological progress drives constant innovation in our world, where subscription business models are no exception. Subscription platforms are not just evolving—they’re transforming how we consume content and services. With this in mind, let’s take a look at the real-time personalization features in subscription platforms, such as Netflix, one of the industry leaders on the market.

Personalization in real-time is a key element of Netflix’s strategy. The company utilizes advanced technologies to provide each user with a unique experience. At the heart of the system are dynamic recommendations that analyze user behavior in real-time, taking into account watched content, ratings, and viewing time. Based on this, algorithms immediately adjust the recommendations displayed on the home page, ensuring that each user sees content most suited to their tastes.

However, Netflix goes a step further by personalizing not only the content but also how it’s presented. The user interface is dynamically modified, including changes to movie and series thumbnails. If the system detects that a user often chooses content with specific actors, it may showcase their images on thumbnails, increasing the likelihood of interest in a given title. Additionally, the company ensures viewing quality by using adaptive streaming, which adjusts the quality of the video stream in real-time based on the user’s current internet bandwidth.

As can be seen, subscription platforms are often at the front of the technology race and utilize advanced tools and innovative concepts that revolutionize content consumption. This approach will certainly last and shape the future of eCommerce subscription businesses.

Increasing popularity of the subscription business model

Apart from implementing new technologies through existing platforms, the recurring revenue model has become a perfect strategy for many other businesses in various industries. The first example is NVIDIA GeForce NOW.  

NVIDIA GeForce NOW is a cloud gaming technology that allows users to stream and play high-quality PC games on various devices without the need for powerful local hardware. The service works by running games on NVIDIA’s remote servers and streaming the video output to the user’s device while simultaneously sending the user’s inputs back to the server.

As gaming PCs are usually a pretty big investment, this technology enables people to play graphically demanding titles on lower-end computers, smartphones, tablets, or smart TVs, as long as they have a stable internet connection. Instead of paying thousands of euros for advanced PC setup, gaming enthusiasts can pay a relatively small membership fee (€ 11 for Priority Edition/€ 22 for Ultimate Edition) and enjoy the newest games on the market.

Another example of an industry that has started to leverage subscription models is the automotive industry. The concept of subscription fees for car features is a relatively new trend in the automotive industry, where automakers charge customers recurring fees to access certain features of their vehicles that were traditionally included in the purchase price. Instead of paying once for a feature at the time of buying the car, customers pay monthly or yearly subscription fees to access or unlock specific functionalities.

Since 2020, BMW has started to introduce subscription-based features in their vehicles. However, in 2022, BMW introduced a subscription model for heated seats in some markets, where customers would need to pay a monthly fee to access this feature. This sparked significant debate, as the hardware was already installed in the vehicle, but the feature was locked behind a paywall.

Tesla, in turn, has been a pioneer in offering software-based subscriptions. Tesla owners can either pay a one-time fee or subscribe to Tesla’s Full Self-Driving package, which includes advanced autopilot capabilities, traffic-aware cruise control, and lane-keeping features. The FSD subscription currently costs $99 per month and is only available in the United States and Canada, with plans to launch in Europe and China in the year 2025.

Examples of eCommerce subscription platforms

Before the conclusion of the blog, let’s take a look at some successful online subscription businesses powered by Sylius.  

Manual.co

manual.co - subscription models

Manual.co is an online health platform for men’s health. The company offers treatments for hair loss, weight loss, sleep issues, skincare, and more. Users complete a medical questionnaire online, and clinicians review the answers and provide a personal treatment plan. Once approved, the treatments are sent to their door. Manual.co also offers ongoing clinician support via phone or email so customers can have professional advice throughout their treatment.

Lillydoo

subscription models - lilydoo

Lillydoo is a baby care brand for modern families. The main products are hypoallergenic diapers, wipes made with 99% water, and other skincare items that are free from parabens, perfumes, and chlorine. The diapers come in various designs and are made from sustainably sourced materials. Lillydoo also offers recyclable packaging and supports eco-friendly practices. They offer a flexible subscription model so customers can customize the orders and cancel them at any time.

Quitoque

subscription models - Quitoque

Quitoque is a French meal kit delivery service. Fresh, seasonal ingredients and easy-to-follow recipes. They are designed for busy families or individuals to save time and eat healthy, home-cooked meals. Customers can choose from 3 recipes a week and get them comfortably delivered to their homes. 

Crokeo

subscription models - crokeo

Crokeo is a pet food company based in Switzerland that offers custom-made meals for dogs and cats. Their products include healthy, natural kibble and fresh meals crafted with locally sourced ingredients. Crokeo provides convenient monthly deliveries, making it easy to maintain your pet’s dietary needs. Their offerings include tasting boxes for pets to try different recipes so everyone can find the most suitable option for their animal friend. 

Conclusion

Subscription business models are undoubtedly the future of many eCommerce businesses. When a transition to this model is done properly, it can boost your company’s revenue and open new doors for expanding the business. Sylius, supported by ready integrations and free plugins, provides a flexible and future-proof platform to create a tailor-made online subscription business. 

Book a free consultation with our Sylius experts and learn how to transition your business to a profitable subscription model.