---
title: 5 Costly Subscription Mistakes to Avoid
description: It's important to know where to start when creating a successful subscription business. Make sure you avoid these costly subscription mistakes!
---

[Blog | Billforward](https://www2.billforward.io/blog)

# [5 Costly Subscription Mistakes to Avoid](https://www2.billforward.io/blog/costly-subscription-mistakes-to-avoid)

 Written by [BillForward](https://www2.billforward.io/blog/author/billforward) | Nov 4, 2021 4:58:00 PM

It’s no secret that **subscriptions** have been a huge success in recent years, with a growth of [“more than 300 percent from 2012 to 2018” in the number of **subscription businesses**](https://www.mckinsey.com/business-functions/marketing-and-sales/our-insights/sign-up-now-creating-consumer-and-business-value-with-subscriptions). This success has only continued during the Covid-19 pandemic, making **subscription models** the new go-to for many companies. Despite this success, creating a subscription business isn’t easy, and costly mistakes are still often made. 

Here are 5 mistakes that you should make sure to avoid when launching a **subscription business**:

### **1. Pricing without the Subscription Model in Mind**

Subscription pricing is often more complicated than pricing for the **traditional product**, and shouldn't just take costs into account. There is a lot more to consider with subscriptions, such as the pricing of upgrades and downgrades, the number of **subscription options** that you offer (in terms of ‘levels’ or ‘tiers’) and the length of these offerings. Whether you decide to use **usage-based billing, tiered pricing**, or another **pricing model**, you need to consider your use case, and how successful this **pricing strategy** is likely to be.

Check out our recent blog for further guidance on [subscription pricing strategies](https://www2.billforward.io/blog/subscription-pricing-strategies).

### **2. Loss of Customers Post Free Trial**

The ‘**Free-Trial’ offering** is common for **SAAS subscription businesses** as a tactic for greater **customer acquisition**, as it convinces a customer to try a subscription offering that may be seen as a risk to sign up for before trying. For example, some subscription businesses only offer their subscription products as 6-month or yearly sign ups, which would appear as costly for new customers who don’t yet know if the offering is a good fit for their needs. For other subscription businesses, such as those offering **physical goods** or **‘subscription boxes’**, other strategies are often used to incentivise customers to try their products. For example, **seasonal discounts, free shipping, or the choice of a ‘bonus’ product** can work as a great way to push customers towards their first purchase.

Converting your **free-trial** customers to paying, **loyal customers**, or convincing customers to continue to purchase your **subscription product** after a **discount period**, however, is another task in itself. Planning your **free trial offering** and/or **discount strategies**, such as by comparing them to other offers in the market, is vital before launch in order to understand how you can keep these customers.

### **3. Failing to Focus on Other Areas of your Business **

Offering subscriptions rather than **traditional products** is a big task, leaving you with a lot to juggle. The amount of time and energy put into perfecting your **subscription offering** could leave other aspects of your business lacking in quality, which will result in lower **customer satisfaction** over time. 

**Customer service**, for example, is important for **subscription businesses** as they may need assistance at any point during their time as a customer. Attracting new customers is more costly than keeping **customer retention** levels high, which is why your customer experience should be as good as it can be. 

### **4. Lack of Pricing Flexibility**

Customers love **flexibility**, especially when it comes to pricing. All customers have differing needs and wants which is why a range of **subscription options**, including the opportunity to upgrade or downgrade, skipping a month of a subscription, or even pausing a subscription for a period such as the holiday season, is a great addition to your offerings. Inflexibility in your pricing is likely to reduce **customer retention**, as customers find themselves stuck with an option that they become unhappy with over time. 

Rather than finding yourself with high **customer churn** rates, which can be particularly costly for your business in the long run, **flexible pricing options** can allow customers to stay loyal, whilst editing their subscription option as and when they need to. 

### **5. Making a 3-Course Meal out of a Snack**

Launching a **subscription business** is complicated enough as it is without the introduction of further challenges. Making your life easier is important when offering a **subscription model** as a lot of time will have to be dedicated to your customers and your subscription offerings. 

Using manual systems for processes that can be automated is an example of overcomplicating- mistakes are costly, especially when it comes to **payments**, **billing**, or **accounting**, which is why automated systems are a great time and money saver even if it means a longer process of setting up your subscription business. 

### **How Billforward Encourages your Subscription Success:**

**Billforward** caters to a range of **pricing strategies** so that your subscription business can price its products as best suits your offerings and customer base. We understand that all business offerings are different, which is why we offer a range of **flexible** options for creating a **subscription model** that suits you, including **invoice customization**, the option for a **headless approach** or a hosted checkout option via our **FlexCheck** feature, and much more. A **flexible billing** and **subscription management platform** is an essential partner in your subscription journey. 

Why not book a discovery call with one of our billing experts and see how we can help you meet your subscription goals!

 

[View full post](https://www2.billforward.io/blog/costly-subscription-mistakes-to-avoid)

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