Like most teens, my middle and high school years had a distinctive soundtrack.
Favorite artists included The Beatles, The Police, Led Zeppelin, R.E.M., U2, Depeche Mode, The Cure … you get the idea.
I was a sheltered pastor’s daughter, and for a little while, rock music itself was totally forbidden.
“The people at those concerts are just doing drugs,” was like a mantra with my overprotective parents.
But it was the early 90s, and I did have an FM radio.
Pretty soon I was dubbing music from it. Then, friends were making me mixtapes.
I started shopping at our local Tower Records. Finally, I secretly bought into my first-ever subscription service: Columbia Music House.
Based on my experience with Columbia Music House, I could never have predicted how ubiquitous subscription services have become today, from Blue Apron to Stitch Fix.
Even Amazon regularly pushes me to “subscribe and save” on items I might want to purchase more than once. This practice is known as “negative option billing,” and is illegal in Canada. Once you sign up, you start receiving monthly shipments unless you expressly opt-out.
I think the Canadians have the right idea here. I’ve learned from personal experience that building a subscription-based business, or any business, on the hope that customers forget to cancel, is a bad idea.
But back in the 90s, Columbia House got me started building my music collection quickly, with those 11 cassette tapes for 99 cents deals.
By college, I had to migrate my entire library to CD one by one, repurchasing many of the same albums. (How could I know digital music was coming?)
You might say they had me hook, line and sinker. But I say, that subscription service connected me to my generation.
I remained a member for over a decade, primarily because I kept wanting the music.
To fulfill the terms of my membership, I believe there was a specific membership obligation to fulfill — you had to buy a certain number of full-priced cassettes or CDs within a certain period of time.
But, unless you opted out of buying their “pick of the month,” they would also automatically send the item, and bill you full price.
Sure, you could return Peter Frampton’s self-titled album for a refund, but who had the time for that?
Packaging the CD up to ship back via the U.S. Postal Service in time just didn’t happen most of the time.
So, I’d just suck it up and keep The Moody Blues Greatest Hits CD (which, for the record, totally grew on me).
But despite the street cred I was developing, as “the girl who knows music,” I became increasingly annoyed with the company, and finally opted out.
Columbia House was in trouble by the mid-2000s due to the rise of digital streamed music and controversial licensing practices — along with the entire music industry.
But I believe they could have weathered even this. I believe they could have won the hearts of their customers at an incredibly deep level if they’d played their cards right.
Don’t Be an Order-Taker
There are subscription services out there today that totally work, and that don’t leave a bad taste in customers’ mouths.
These companies are actually taking the time to get to know their customers, and providing something of value to them.
One subscription-model company I will continue to do business with is Chewy.com, the dog food subscription service. Their emphasis on building customer relationships beyond just processing transactions have ultimately built a strong bond between us.
They once credited me back for some dog poop bags I didn’t think I ordered, no questions asked. When I called them, I explained:
“These are for a poop scooper, not the poop bag dispenser I use, the one attached to my dog’s leash.”
Their friendly customer service rep immediately gave me my money back, but didn’t require me to return the poop bags.
She suggested I donate the unwanted item to a local pet charity.
The customer service rep conveyed Chewy’s mission to a tee, and won a loyal customer with that simple, inexpensive action. Chewy understands that their customers are pet lovers. They cater to that!
Hey, Columbia House! I joined because I am a music lover! I love to discover new music! Instead of making me say “no” to your Pick of the Month, invite me to say “yes” to something awesome and unique that only I could love!
Columbia House stayed behind the counter for the entire time I was a subscriber, taking my tape and CD orders instead of creating and providing a valuable service that I would rely on for years to come.
Unfortunately, many modern subscription-based companies also use unclear billing practices, difficult cancellation processes, and poor communication protocols. Even when they offer a great deal on price or lightning-fast shipping, these companies always leave a bad taste in the customer’s mouth and end up looking like they’re in it for themselves. It’s because they haven’t figured out how to create real value for their customer.
We all know intuitively that you get what you pay for. Competing on price and simply taking orders is always a losing proposition. Other companies will always find a way to lower their prices, and it becomes a great race to the bottom on every count: price, quality, overall value, and customer loyalty.
Great brands want to be price leaders. They want customers who will pay a premium, because their product or service is that much better than the competition.
Spotify, arguably the leader in the subscription music service world today, invests in machine learning and AI to help artists better understand their audience and reach … and to get discovered by members. This data also helps Spotify more deeply understand their biggest asset, their customer base, and generate great, predictive recommendations that keep us coming back.
So if you’re building a business, build it on knowing your customer, listening to them and understanding them. Then provide something unique based on what they’ve told you.
About the Author
Hi there! I’m Amanda Jenkins, Creative Director at MarketIQ, a Multi-Business Owner, Digital Nomad, Yoga Instructor and Mom. If this article resonated with you, please subscribe to my personal blog. I’ll also keep you posted on publication of my forthcoming book, How to Go From Hustle to Flow. You can connect with me on these social platforms, too: LinkedIn, Twitter, Facebook, and Instagram.