Subscribe & Save strategies: Amazon FBA Strategy that Boosts Monthly Revenue

As an Amazon FBA seller, you benefit significantly from Amazon’s global network of fulfillment centers and the opportunity to offer free shipping through Prime. But those aren’t the only features the ecommerce platform provides to help grow your business.

In recent years, the Subscribe and Save program has emerged as one of the most effective ways to help FBA sellers grow their customer base and drive consistent sales.

Are you curious about how the program can help boost your revenue?

In this guide, we’ll outline what you need to know about Subscribe and Save and some strategies to help you make the most of the feature.

What is Subscribe and Save?

In 2007, Amazon introduced Subscribe and Save, a feature that allows customers to schedule recurring deliveries of products they frequently order.

For customers, the program eliminates the hassle of having to place orders every time they want to re-purchase a product. Customers can choose how often they want the item delivered (monthly, once every two months, etc),  and can easily cancel or modify their subscription at any time.

So, that explains the “Subscribe” option. But where does the “Save” aspect come in?

Depending on the number of orders placed, customers can avail of discounts between 5% and 15%. Amazon estimated in 2023 that these discounts resulted in $1 billion in savings for its customers around the world.

But it isn’t just the customer who benefits. For Amazon FBA sellers, Subscribe and Save presents a great opportunity, guaranteeing consistent sales and enhanced customer loyalty.

Who is Eligible for Subscribe and Save?

FBA sellers who want to participate in the Subscribe and Save program must meet certain criteria to be eligible. These include:

• A professional seller account with a solid standing on the platform
• An account that’s at least three months old
• Feedback rating of 4.7 or higher
• Reliable fulfillment history, with an 85% in-stock rate

To check your eligibility, navigate to Fulfillment by Amazon’s subscription settings on the Seller Central dashboard.

There are also restrictions on what products can be sold under Subscribe and Save. Most of these, as you’d imagine, are consumable items, such as diapers, health supplements, groceries, and beauty and skin-care products. Also included are home and office products, music equipment, toys, and various industrial supplies.

A complete list of all eligible products can be found on the Seller Central dashboard.

For a general idea of what to expect, consider this: The company said in 2023 that over the previous year, the feature had helped sell 29 million tubes of toothpaste, 630 million cups of coffee, and one billion dog treats.

Who Funds the Discounts?

As we mentioned earlier, customers who use the Subscribe and Save feature get access to several discounts. As an FBA seller, you’re probably curious about how this works.

Here’s the lowdown.

As of 2020, Amazon allows sellers to choose between three base discounts: 0%, 5%, and 10%. Then, regardless of which option you choose, Amazon offers an additional 5% discount to customers who receive five or more products in one auto-delivery.

So, if you offer a 0% discount, and a customer subscribes to more than five products, they receive a 5% discount from Amazon. Similarly, if you offer a 10% discount, the customer gets a 15% discount. Customers who order one to four products will only receive the discount set by the seller.

While the choice of how much to discount a product is up to you, Amazon highlights that products with a 10% to 15% discount have a 1.8x higher conversion rate, which can significantly impact your revenue.

To incentivize customers, you can also offer coupons that are only activated when a customer signs up for Subscribe and Save.

Benefits of Subscribe and Save

What can you gain from opting into the Subscribe to Save program?

Here are some of the most important benefits:

• Consistent Sales: When a customer commits to buying items from your store on a regular basis, you benefit from consistent revenue.
• Increased Loyalty: Customers who enjoy the convenience of buying a product regularly and at discounted rates are more likely to be loyal to the seller.
• Improved Visibility: Products tagged in the Subscribe and Save category are more likely to stand out in search results.
• Build up a Brand: Over time, as a customer continues to receive a product, they’re more likely to recall the brand name and trust it for future purchases.

Customers benefit from discounts, free shipping, and the convenience offered by this purchase model. Much of this satisfaction will translate into praise for your product, which, in turn, improves your brand’s reputation.

Amazon FBA Subscribe & Save strategies

As we’ve seen, the Subscribe and Save model offers both customers and sellers a host of benefits. But that’s only if it’s used right.

There are several things to consider when devising a Subscribe and Save strategy. For instance, sellers will have to price their products optimally to avoid low margins. Furthermore, you will also have to pre-empt and iron out inventory issues to ensure all customers get their orders on time.

Fortunately, we have the perfect tool to help manage all of these details.

Sellerise recently launched a Subscribe and Save Analytics tool that offers users a comprehensive overview of the audience and helps them devise a successful strategy.

How does it help? Here are some benefits:

• Comprehensive Insights: The tool tracks how many customers use Subscribe and Save, what products they buy, and how many orders they place.
• Sales and Trends: A handy dashboard gives you an overview of the latest trends and patterns, as well as predicts future trends, which help you plan your relevant marketing strategies.

• Forecasts: The tool estimates future orders, ensuring your stock is always ready and you never run out of items.

• Profit Optimization: The tool helps you learn more about discount rates and potential lost revenue of stockouts. It also offers tips to help increase sales.

• Better Inventory Management: The dashboard forecasts how many units will be sold and sales you'll make in the future; so you can keep the perfect inventory level of each product to meet demand.

The Sellerise tool is the ideal partner for any FBA seller looking to make the most of their Subscribe and Save strategies.

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