A recent consumer survey revealed interesting insights
into customer expectations. Customers subscribing to a service plan preferred
an unlimited plan as opposed to paying per use. Why do we like unlimited plans,
even though they may cost more than we would have liked and provide for more
than we need?
There could be a lot of factors that determine this: peace of
mind, high rates for pay-per-use, nature of service and consumption, affordability, etc. Or, in some cases, service provider's may have inadvertently created the "need" for the above factors to be relevant. From the latter's perspective, these plans often allow for easy management of customer expectations and accounts, support, data management, retention, etc. - all pertinent factors to consider when assessing the ROI models.
However, unlimited plans do tend to create (sometimes) unrealistic expectations among consumers and start to create undue pressure on service provider's resources and revenue. Needless to say there needs to be wider strategy to offset such pressure and create alternative/complementary revenue streams. The fact that each service has its unique
requirements and customer need, we need to really look at the subscription
business a bit creatively.
Analyze the usage data to define various customer
segments and create value plans that appeal to these segments – fairly obvious,
right? However, it needs overt management approval and significant investments
in data gathering, accuracy, regular customer feedback (surveys?), frequent
usage analyses, industry feedback, back-end infrastructure, etc. Most importantly, organizations need to be flexible enough to stay ahead of the evolving customer need and sustain customer
interest in the service. Add-on service options tend to help fill that gap and help increase customer longevity and retention.
Adding incremental value to the core offering and
managing customer expectations from the service are equally important, but value-added services enhance the core and add critical benefits through incremental revenue and customer loyalty. In markets served by "commodity type" services, it becomes even more relevant to differentiate ourselves from
the competition and hence warrants enough incentive for the management to invest in providing services beyond the "unlimited" plans.
