DTC 378: Maximize Amazon Revenue

Want to drive major brand growth on Amazon?

Subscription revenue is the answer. 💪

Once you've fine-tuned your strategy to generate Amazon subscriptions, your brand can focus on assertive strategies for acquiring new customers. 

Subscribe and Save discounts allow you to ease up on strict profit margins for first-time buyers, knowing you’ll make the revenue back (and a profit!) from the lifetime value of your consumers. 

Subscriptions also provide a stable recurring revenue source, allowing for more predictability and added forecasting confidence. 😌

Despite the massive value of building subscription revenue, some brands are still reluctant to fund the full 10% for Subscribe and Save (SnS) orders. 

The Pilothouse Amazon team always recommends funding the maximum 10% discount for Subscribe and Save ASINs (Amazon Standard Identification Number) to maximize the subscription rate.

Weary about funding SnS? Here’s why we think you should: 👇

1️⃣ Funding the full 10% maximizes the incentive for customers to subscribe

While it's a fact that certain customers might exploit subscriptions solely for the associated advantages and promptly cancel, it's important to recognize that this behavior is only a portion of the customer base, not the entirety.

Funneling some resources into the Subscription and Save (SnS) approach has proven effective in bolstering the monthly subscription earnings across various client accounts. 💸

This indicates that the benefits outweigh the drawbacks posed by some customers' occasional subscribe ➔ unsubscribe pattern.

Additionally, Amazon funds an additional 5% on subscription orders that ship five or more items in a single order, further incentivizing customers to keep their subscriptions. 

2️⃣ Increases organic sales and funds prospecting efforts

Each subscriber is a future order waiting to come through. 

Many consumable product categories have very high CPC (cost per click) and CPA (cost per acquisition), meaning your customer acquisition strategy is frequently not profitable on first purchase. 

Repeat subscription sales are highly efficient with the equivalent of only a 10% ACOS (Advertising Cost of Sale). 

How is the Pilothouse team supercharging subscription rates? SnS coupons! 🎟️

SnS coupons, which rolled out into Seller accounts earlier this year, function like normal Amazon coupons. However, they only apply if the customer subscribes, giving sellers a lot more influence over subscriptions than before. 

The team likes to utilize these coupons with an aggressive discount (think 20%+ off) to really encourage a subscription. The margin sacrifice on the first purchase is usually worth the subscription growth gained. 

Does it work? You bet it does! This tactic allowed the Pilothouse Amazon team to more than double an already six-figure monthly subscription revenue year-over-year. 🔥  

These highly efficient sales are a powerful way to scale your brand and provide funding for your prospecting PPC (pay-per-click) efforts. 

If you utilize them well, this creates an SnS flywheel where you acquire customers through prospecting PPC, a percentage of these customers subscribe, their future SnS orders fund more prospecting, and the cycle scales and repeats. ♻️

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