Subscription-based services are becoming more popular due to the COVID-19 pandemic as consumers look for contactless shopping options and ways to adapt to staying at home more. Demand for food deliveries, educational tools, hygiene supplies, and entertainment and gaming services has risen.

The World Advertising Research Center (WARC) reports that 43% of UK and US consumers are considering a new subscription service during the COVID-19 outbreak. PYMNTS reports that streaming services alone will see a 5% spike in global demand by the end of 2020s.

"All of the subscription services I spoke with are experiencing an uptick in members now, and for obvious reasons: They arrive at the house without families having to leave for pickup, with minimal human touch, and in answer to a parent's specific need," wrote Robin Raskin, founder of Living in Digital Times, on Kidscreen.

As brands look to capitalize on the demand for subscription-based services, a key aspect of winning and retaining loyal customers hinges on creating an experience that deepens the customer and brand relationship.  But, offering a subscription-based service can also be highly complex, with the need to give consumers flexibility and choice in how those services are curated, paid for and fulfilled.

To help you determine whether or not you've got the systems in place to support a successful subscription-based service offering for your retail business, here are some key factors to consider:

Flexibility across your subscription service offering is vital

A crucial part of being able to offer customers a seamless and delightful experience when it comes to subscription-based services is the ability to provide flexibility.

"Having a platform that gives you the ability to be flexible with product offerings, payment and fulfillment is crucial," says recurring payments provider sticky.io's Ro Bhatia. "It's important to have a platform that understands DTC and can allow for users to bundle products, curate products or replenish products."

For example, Birchbox says they've responded to changing demands and trends by adding more personal care products to their merchandising, like hand sanitizer. Hair, fragrance and body categories have also seen a 15% sales increase month-over-month since the pandemic.

Payment flexibility is also important to consumers and should include the ability for consumers to pay through localized payment methods like Apple Pay or eWallet if they don't want to rely on credit cards. Having more flexibility in subscription management options, such as letting customers pause rather than cancel their subscriptions, can also improve retention.

Due to the coronavirus pandemic, Birchbox U.S. president Ali Edgerton said that financial reasons had moved from the second most cited reason for canceling to the primary reason. In reaction to current customers' needs for more payment flexibility given the financial hardships of the times, Box of Style, which focuses on fashion, accessory and beauty products, says they quickly added a "pause" function to all their subscribers' accounts.

Flexible fulfillment is another critical aspect when it comes to a seamless customer experience – and it's become increasingly more important during COVID. Customers want options to buy online and pick up in-store or have items delivered to a new address if they've decamped from hot spots like New York City to the countryside. But many e-commerce platforms don't have these types of flexible or omnichannel fulfillment options natively built-in.

Omnichannel capabilities are essential to meeting expectations

While many e-commerce platforms don't have omnichannel fulfillment flexibility built-in, they should be able to integrate either natively or through partners to offer these services. Easy integration between an e-commerce platform and your brand's tax platform and accounting platform are also crucial integrations to consider.

In addition to ensuring your e-commerce platform gives you the flexibility to support different product offerings, payment options and subscription management options, it also needs to be able to support an end-to-end omnichannel experience.

"Subscribers are interacting with your brand in many different ways. There's not just one storefront or one landing page or one retailer that you can go to. So being able to provide this omnichannel experience or sell wherever your customers want to buy from is crucial for an e-commerce platform," says Bhatia. "An e-commerce platform becomes a centralized platform to manage all these different channels and the data you're collecting on these channels."

Benefits go beyond recurring revenue

One of the primary benefits of a subscription service is that it can help your brand build closer customer relationships. Whether the subscription service is once a month or every six months, by simply having a reoccurring interaction with customers, your brand remains on customers' radars and builds greater loyalty.

However, many brands and e-commerce retailers still wonder if subscription-based services are right for their business, especially if their product isn't conducive to a subscription type of business or they are worried about jeopardizing business from their in-store or online sales. Bhatia's advice is not to worry about these types of concerns, because one of the biggest benefits of subscription-based services is the data it generates, and the opportunity it provides to remain connected to your customers. Even mattress companies, he notes, have found ways to create subscription-based services, whether that's content or smaller sleep-related items.

"Subscription models inherently create huge amounts of data, which can be critical for staying ahead of customer and market changes," says Bhatia. "Understanding your customer's lifecycle journey beyond the first purchase is crucial – and it's one of the biggest benefits offering a subscription-based service can provide."