Use three key metrics to measure beverage program success to ensure long-term viability and maximize profits.
Loyalty programs in convenience retail are no longer a nice-to-have, but a necessity in order to stay competitive. Subscription programs are next-level loyalty and because the customer has money invested, the program will realize much higher utilization rates. It is imperative to measure program success to ensure success and to increase profits.
Measure Subscription Program Success
Subscription programs will increase foot traffic, enhance foodservice offers, and are the epitome of convenience for customers looking for a quick and satisfying store visit. Just like any investment, it is imperative to measure success to capitalize on and improve a program over time. Eventually, the program must evolve and grow to match your brand and customers’ behaviors and needs.
Are you recruiting and retaining subscribers and is that number growing? Are subscribers consuming a specific type of product more than another? What time of day or days of the week are subscribers most likely to add on additional purchases? Answers to these questions will help you tailor the offer, the program marketing, as well as appropriate add-on item promotions.
Here are some of the key metrics to consider to measure the success of your subscription program:
Measure Subscriber Acquisition and Retention
Simply put, how many subscribers do you have and is that number growing?
Set a monthly target for new subscribers and consider incentivizing employees to get customers to subscribe. Current loyalty members are a perfect target segment as they already have some investment in your brand with whom you have direct contact. Set a percentage of loyalty members that you can work to convert into subscribers.
How frequently are subscribers fulfilling their subscription allotment?
You want subscribers to find value in their subscriptions so they continue to renew. If they aren’t taking advantage of the offer, perhaps they need prompting in their app, or by text or email. Set a metric for optimal use scenarios such as 3 redemptions per week or 5 per month (or more).
However, there could be extreme users who take full advantage of their subscription and there will be a threshold when the program becomes unprofitable due to the cost of goods exceeding subscription revenue. Examples of this are if more subscribers than expected take full advantage of an unlimited product offer or if the price of the subscription is too low in relation to the cost of the product.
To solve this, you may need to increase the monthly subscription cost, narrow the redemption frequency (instead of unlimited, it becomes one per day or 3 per week), or reduce the items available (instead of the full beverage line, it becomes just coffee and fountain drinks and omit frozen drinks).
Also, add upselling offers so that every redemption of the subscription product comes with more additional items from your store and thus a more valuable visit every time!
Growth of Basket Size
A key driver of subscription program success is increasing sales of items in addition to the subscribed product. It is a fact that a beverage subscription program increases foodservice sales.
It may help to focus on a particular daypart at different intervals to measure customer uptake. If you want to sell more breakfast items, promote coffee in your beverage subscription program. If you want to sell more lunch items, focus instead on the fountain sodas. If you want to grow weekend sales, focus on indulgent drinks like frappes or slushies.
Follow the sales of food items in the baskets of subscribers and you will notice the overall growth pattern.
Lead the Pack in Foodservice
In the evolving and ever-competitive landscape for convenience stores, beverage subscription programs are a potent tool to amplify foodservice sales throughout various dayparts. By delivering a variety of beverages, convenience stores effortlessly introduce a diverse range of combinations tailored to specific times of day. As more and more companies join the subscription economy, don’t get left behind.
Liquid Barcodes has long been the industry leader in subscriptions, servicing more than 2,000 locations in the U.S. alone. Having helped convenience stores around the globe, especially in Europe, offering beverage and foodservice programs to thousands of customers daily, Liquid Barcodes is quickly becoming the industry leader in foodservice subscriptions.
More About Subscriptions
This summer, we’ve been publishing several articles in our Summer Subscription Series to help you learn the basics and more about subscription programs. Check out these great articles to find your fit.
- An Introduction to Subscription Programs
- Which Subscription Model Will Win You the Most Customers?
- Use Digital Prepaid Cards to Get Started With Subscription Programs
- Beverage Subscriptions Improve Foodservice Sales
- Enhance Foodservice Sales With Daypart Marketing and a Beverage Subscription Program
About Liquid Barcodes
Liquid Barcodes is a leading global loyalty and digital marketing technology company specializing in the convenience and foodservice industries. The proprietary, cloud-based technology platform allows retailers to create and manage their digital marketing campaigns with a process called the “customer connection cycle’ to engage, promote, and reward customers’ activities in real time across digital and media channels.
Liquid Barcodes loyalty platform is powering loyalty programs for industry leaders across several global markets, by offering unique subscription, mobile payment, machine learning, personalization, gamification, loyalty, and other capabilities.
About the Author
Carolyn Schnare, Chief Content Officer, Liquid Barcodes
Carolyn Schnare has been involved with the convenience retailing industry for two decades with extensive knowledge of customer engagement and marketing, sustainability, and community outreach. Before Liquid Barcodes, Schnare worked at NACS (National Association of Convenience Stores) in a variety of roles from event production to membership and most recently as Director of Strategic Initiatives and host and producer of the popular industry podcast, Convenience Matters. Schnare currently anchors the popular Shop Talk LIVE! video series produced by Global Convenience Store Focus media group.