Recurring auto-shipments and one-click payments are becoming staples of the eCommerce experience.
Auto-shipments have long been a fundamental aspect of the direct selling industry, even before online ordering dominated customer habits. From software to entertainment to coffee and groceries, home essentials, baby and pet products and more, consumers are becoming more and more accustomed to ordering everyday items on an automatic, reoccurring basis. Tying subscription services to customer loyalty programs, offering one-click payments and leveraging digital wallets are also increasingly popular strategies to increase customer retention and better predict revenue.
“Subscription services have been gaining traction over the past few years as consumers become more used to receiving regular goods shipments instead of making one-off purchases,” noted an article by eCommerce firm Webmefy. “Setting up recurring orders saves customers time by ensuring they always have items they need regularly. It also provides an additional revenue stream for businesses by locking customers into recurring payments for their goods.”
Allowing simple online cancellation helps increase subscriptions. Brightback, an automation software company, found that 80 percent of consumers are more likely to try or buy a new subscription if they can cancel it online. Help Scout, a Boston-based digital help desk company, says that an increase in subscription models requires a strengthened customer service focus. “We expect to see a high growth in businesses offering subscription models to their customers in order to create a more predictable income stream,” the company said. “This makes it vital for customer service teams to develop their retention skills. Poor service is a leading cause of customer churn, while a great support team can increase retention and contribute to revenue expansion.”
Food delivery service is one of the fastest-growing online ordering sectors, with subscription-based delivery one of the top trends. According to Onfleet, the U.S. online food delivery market reached $23.4 billion in 2021 and is expected to reach $42.6 billion by 2027. Postmates, Grubhub, Uber and DoorDash offer subscription-based options with reduced fees and exclusive deals from restaurants and grocery stores. Custom menus, pre-selected meal kits, drone deliveries and increased competition are helping normalize recurring food delivery.
Auto-shipments or subscription ordering removes the need to re-enter sensitive payment information. These options are implementing evolving technologies such as mobile and digital wallets, one-click payments, third-party pay platforms and in-app payments. According to Statista, the number of mobile wallets maintained by consumers should reach 4.8 billion by 2025 compared to 2.8 billion in 2020. It’s also predicted that businesses will process $8 trillion in frictionless payments by 2024—doubling the amount from 2020.
Embedded payment options are also on the rise since more customers are opting to save their payment info with merchants. This way, customers can pay with one click of a button or easily purchase within an app.
Text-based payments are also on the rise. “Lengthy checkout pages can be a turnoff to eCommerce customers. Embedded payments let you skip the added steps, instead providing a single, clickable button on your app or website,” explained payment service company GoCardless. “Paying with a single click makes the checkout experience much easier for consumers, which also increases purchase frequency. For all these reasons, it’s well worth considering working embedded payments into your eCommerce strategy.”
From the March 2023 issue of Direct Selling News magazine.