Subscription sales: A new sales strategy

– Aug 1, 2021
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This is the first article in our 12-part subscription sales series, designed to help you understand and prepare for the evolving sales landscape. This article shares emerging sales trends and changes in buyer behaviour, and identifies their impact on your sales approach to help you adjust it to meet new customer expectations. This series will guide you through a step-by-step formula to build a successful sales strategy, including targeting your most profitable customer segment, identifying effective customer channels, communicating with clarity and using data as feedback for continual improvement.

Companies across a variety of industries are switching to a subscription-based business model which has changed the nature of a businesses’ transactions. Simultaneously, there has been a shift in customer purchasing behaviour and the expectations of the buying experience. Despite these significant changes, there is little focus on how businesses need to adapt their sales strategies to be successful in the new context of subscription sales.

The sales environment has evolved

Subscriptions: the new sales model

The subscription business model is growing in popularity. This model can include an upfront product purchase, but the key feature is that customers commit to making regular small payments either for subsequent product purchases, product integration, maintenance and/or support.

A well-known example of this business model is Software as a Service, or SaaS. In the past, customers would make a large, one-off purchase to buy a software product that would eventually become outdated and need to be replaced. In the SaaS model, customers don’t own software; the SaaS company owns and centrally hosts the software. Customers make regular, small payments for a license to use the product. Customers have access to software upgrades as they are released and can easily change products as required.

Transactions look different

The nature of transactions has recently changed substantially in terms of size, volume and decision makers.

Under traditional business models, transactions were large, one-off payments made at the initial transaction. This created a high-cost sales approach where individual sales representatives built deep relationships with clients to secure these large deals.

Under a subscription model, customers make smaller payments over a longer timeframe. Subscription transactions are high volume and low value and customers can easily switch products. Consequently, businesses need a new sales approach to suit the subscription sales model. This approach should be low cost and focus on continued customer satisfaction to ensure ongoing subscription product purchases.

Another change in the sales environment is how businesses make purchasing decisions. Historically, one individual was responsible for making significant purchases. This created an environment where individual sales representatives focused on building and maintaining relationships with individual key clients.

Today, important purchasing decisions are made by committees. This requires sales teams to take a different approach. They need to build more relationships to navigate the politics of numerous decision makers, and ensure their sales approach addresses the unique concerns of each committee member to achieve consensus.

Customer expectations have changed. Massively.

Companies such as Uber, Domino’s and Amazon have contributed to remarkable innovations in the business-to-consumer (B2C) sales experience, while business-to-business (B2B) sales have experienced little change. Since B2B customers are also B2C customers, their recent B2C experiences have created much higher expectations that are not currently being met by B2C companies.

One of the key changes in customer expectations is the ability to immediately engage online through a range of communication channels, including web chat, video chat, email and social media. This creates a customer expectation for simple, consistent and personalised engagement, but requires a big shift for B2B sales teams.

Changes to sales methods for the new world

Sales has historically been seen as an art form or intangible skill, where relationships alone were enough to win large, one-off deals. Changes in the decision-making process and an increase in the number of decision makers have ensured that this approach is no longer viable.

The end goal for subscription businesses with high-volume and low-value transactions is scale. These businesses need a low-cost, structured and repetitive sales process that can deliver scale without driving up the cost of acquisition.

The B2B sales approach must evolve in response to customers’ new expectations for the sales experience. B2B companies must adopt digital sales channels and build a sales team that can operate, engage and ultimately sell online. These businesses must also develop new sales approaches to meet the needs of a committee of decision makers.

Ultimately, B2B companies require a customer-centric sales approach that is carefully designed around customer behaviours, needs and expectations. Since customers and the market are constantly changing, B2B companies should continually integrate lessons learned and adaptation into their sales method.

Contact us for more information on how we can help you create your new sales strategy.


Next up in this series is an article on customer segmentation.

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