The Lee Kenny column: How to Futureproof your business

Lee Kenny, managing director of Snowflake Media.
Lee Kenny, managing director of Snowflake Media.

There is a growing feeling around the world that the new generation would rather rent something than own “things”.

Netflix replaces DVD, Uber replaces the need for a car, iTunes stops you buying “Now That’s What I call Music 937!”.

Think about your mobile phone. More than 60 % of the UK phones are on a contract rather than outright purchase.

While you may indeed own it at the end of the contract, often it’s thrown in a drawer or given to someone else at the end of the contract and the lease process starts again.

Over the past year, if you spend any time online, you will have seen the rise of subscription services.

Surprisingly the one industry that seems to be slow to catch on to this trend is bricks and mortar retailers, especially independent ones. As a company Snowflake Media has helped hundreds of businesses around the world capitalise on this new income flow. The major benefits all these businesses see are:

Great Consumer feedback

You get almost real-time feedback from your users as to whether your product choice is a hit or not.

The larger companies employ a rating system each month which can be very sophisticated (ie expensive to operate), but smaller businesses can simply call a handful.

This helps future buying patterns and also allows you to decide what to stock for your non-subscription customers.

Strong loyalty factor

Everyone in business is familiar with the notion that it is easier to sell to an existing customer. Building a subscription business gives you the opportunity to communicate every month with your customers, rather than the sporadic emails or Facebook posts.

You can include advertisements and flyers with your monthly box.

Increase footfall

Not all subscriptions need to be posted out each month. Some innovative restaurants and retailers use these subscription services to drive people to collect things from the shop each month. If you had a wine-club, people can simply call and collect their monthly gift.

Guaranteed cash flow

The #1 reason people should consider this is that it provides a guaranteed monthly sales number. So many retailers don’t know whether they are going to have a good or a bad week. This allows you to pre-book revenue ahead of time. That removes a lot of pressure each month!

Of course, you need a good product and to exceed expectations. The downside with monthly “rent” rather than buying outright is you have to delight your customers month in, month out.

What business can run a subscription model?

Every business!