@Rob_at_Onto bit of an idea for you in relation to the Subscription pricing… (@Adam_at_Onto tagging you as mentioned)
I note from meeting you today that you mention that moving to anything more than a 1 rolling monthly agreement brings in legal and business model issues which without going into detail here, when you explained it made sense.
So, as a possible workaround I’ve thought of this idea, I’ve had a look around and can’t see it being suggested yet, sorry to anyone who’s already suggested this and I’ve missed it!
The problems/issues…
- Can’t do longer than 1 month agreements
- Customers want cheaper subscriptions
- Customers are willing to commit for longer for cheaper subscriptions
- Technology limitations can be an issue so an idea needs to be easily implemented.
- More car swaps cost the business more money
- The longer the customer keeps the car, the better and more security it brings from an income stream.
The solution…
A tiered subscription model for the customer depending on their car model…
Example…
The Zoe Iconic on it’s new pricing structure is £439 per month.
If the customer is looking to have the car for a longer term, when they reach certain milestones, the monthly price for that car would drop, but if they swap car, they reset to 1 or 2 tiers down and have to work their way up the tiers again, e.g.
(this is all from continuous subscription, not broken up and the pricing I’ve used below is the new vs old pricing as a way of bringing it down)
T1 - Months 1 to 3 - £439 per month
T2 - Months 3 to 6 - £429 per month
T3 - Months 6 to 9 - £419 per month
T4 - Months 9 to 12 - £409 per month
T5 - Months 12 - 18 - £399 per month
T6 - Months 18+ - £389 per month
This to me seems possible as you already reward users who are 6 months in for the rewards points, so if you can track the length of time someone has been with you, it should be relatively easy to track how long someone has been with you and their subscription length etc?
Obviously you’ll have little details to work out, but as a rough idea, I wonder if this would work?
This way, you’re not contracting people into yourselves so you remove the legal and business model issues, but you’re creating an alternative to it which is if the user opts to stay longer, you pay that back in return because the customer is giving you a more reliable income stream.
If you kept the customer on the new pricing the same for 24 months that would be £10,536 to yourselves
On the model I suggested it would be - £9,816
So only a difference of £720 less to you, but something of an incentive to the customer that makes them want to stay with you for longer as they will be rewarded for staying with you
On the old pricing for 24 months, this would be £9,336, so you’d still be making an additional £480 on the new model I’m suggesting
Clearly my pricing is more towards the cheaper side to the customer, the exact numbers would be something you’d have to come up with