Setting Up An Ecommerce Subscription Model

8 years back, India's top rideshare brand's acquisition funnel was like this. - 100 users install their app  - 35 users signed up with Phone no. & Email  - 8 users booked a ride on the app successfully within 7 days of install They were the market leaders. Yet, it had a lousy acquisition funnel. Then, the cost per install(CPI) for the rideshare industry used to be $0.5 or INR40 at scale. With this acquisition funnel, the cost of acquisition(CAC) was $6 or INR500. The average order value(AOV) was $2 or INR150. At a 20% gross margin, it took more than 17 rides to break even at this CAC level. A clear recipe for disaster. Then, we made a simple change in the acquisition flow. It increased the new user conversion rate by ~100%, reducing the CAC by ~50%. Removing the Email ID requirement in the signup flow. - Install to signup rate increased from 35% to 60%  - Install to booking rate improved from 8% to 15% After the ride completion, promoting the user to add an email ID to receive the invoice got us the email ID from most users who had one. This is an incremental change that yielded an outsized outcome. Today, most brands use this "phone no. only" flow. Not then, because most of the acquisition flow is inspired by the Western counterparts. This improvement becomes quite pronounced as the brand expands to the T3+ cities and older age segment. Another great idea to test in the acquisition flow is moving the signup prompt to the end. By Installing the app, the user makes a small investment in the brand. What If we let the user see the available cabs or browse the product immediately? Without the need for you to sign up. When they are about to book or make a purchase, prompt them to sign up. At this stage, the user invested additional time in the platform. Even for a free platform, we can let the user browse the content catalog and prompt them to sign up when they decide to consume. More investment means more likely to convert. Trying this will undoubtedly improve the install-to-activation/purchase rate for all brands.

Silent Red Flags in a Contract Not all contract risks are obvious. Some don’t wave big red flags they sit there quietly, sipping coffee, waiting to ruin your day when it’s too late. Here are a few sneaky ones to watch out for: 1. Termination Notice that has a trap ex: “Either party may terminate by giving a 90-day prior written notice by registered post.” This sounds fine until the other party refuses to accept mail, leaving you stuck. Flexibility in notice delivery methods (emails, RPAD, etc.) helps avoid this. 2. Auto-Renewal that feels like some subscription you forgot to cancel ex: A contract that auto-renews unless terminated 60 days before expiry. Missed the deadline? Congratulations, you just bought another term of commitment. Always check renewal terms and negotiate flexibility. 3. ‘Reasonable Efforts’ without a guiding light ex: “The service provider shall take all reasonable steps to ensure 99.5% website up-time.” Reasonable to whom? The client? The universe? Always define obligations with measurable standards. 4. Confidentiality that lasts forever ex: “The receiving party shall never disclose or use the confidential information.” Never is a long time, longer than some companies exist. A well-drafted clause should account for practical realities (disclosures required by law, etc.). 5. One-sided dispute resolution ex: “All disputes shall be resolved by arbitration, and the Party A shall appoint the arbitrator.” Agreeing to this means you’re going to their turf every time. Always ensure jurisdiction and dispute resolution are neutral. 6. Hidden costs in referenced documents ex: The main contract looks great, but a linked “Standard Terms & Conditions” document quietly adds extra fees, penalties, and other nightmares. Always review referenced docs. for no surprises. 7. ‘Best efforts’ vs. ‘Commercially reasonable efforts (CRE)’ ex: “The contractor shall use its best efforts to complete the project on time.” Best efforts could mean working 24/7 with unlimited resources. CRE = practical, business-minded execution. Choose wisely. 8. Non-Compete clauses that overreach ex: “The employee shall not engage in a competing business at any time in the future.” is a legal life sentence. Restrictions ought to be reasonable in scope, and duration. 9. Force Majeure that helps one side ex: “In case of an unforeseeable event, Party A is excused from obligations.” And Party B? Well… good luck. Force majeure should work both ways. 10. Silent Assignment clauses ex: You sign a contract with a trusted vendor, only to realize they’ve assigned their obligations to an unknown entity. Avoid unpleasant surprise, and require written consent before assignment. A little ambiguity is unavoidable. But when vagueness creates risk, or gives one party too much control, that’s when alarms should go off. #ContractReview #InHouseCounsel

We're moving away from charging for *access* to software and toward a model of charging for the *work delivered* by a combination of software and AI agents. Let’s dive into what’s happening and what it means for you ⤵️ 1. The rise of disruptive AI pricing models Tech companies are realizing they can't solely rely on seat-based subscriptions in an age of AI, automation and APIs where value is disconnected with how many people are logging in. Perhaps Salesforce going all-in on Agentforce (and charging $2 per conversation) was the push the industry needed. Each product category has its own flavor of disruptive pricing. - Legal AI products might charge for a demand package generated by AI or an AI-generated summary. - Creator AI products might charge for the content that gets produced such as a video generation or amount of video created. - GTM products might charge for specific tasks completed or workflows executed by the AI. 2. Selling work, not necessarily success As a customer, I wish I only had to pay for software when it delivered results. But the reality is that true success-based billing won’t work for the vast majority of today’s products. Most products should charge for work output instead. The issue is attribution. You want the customer to get a fantastic outcome — and you want them to recognize that your product powered that outcome. As soon as you start charging for success, the customer begins to rethink the results. 3. Goodbye ARR as we know it? Shifting to these newer value-based pricing models isn't a simple pricing change you can just announce in a press release. It's a business model evolution that looks a lot like the shift from on-prem to SaaS in the first place. These new AI pricing models might mean greater volatility in both usage and spend. Variable margin profiles across products and customers. Seasonal revenue fluctuations. The potential for project-based, non-recurring use cases. Put simply, annual recurring revenue (ARR) continues to get dethroned. — Full post in today’s Growth Unhinged newsletter: https://lnkd.in/ea5eTrVD Things are about to get interesting 🍿 #ai #pricing #saas

Subscription commerce failed in India for a decade. Now it's working. Why? I remember 2016. Every other pitch deck had "subscription box" on it. Fab Bag, beauty boxes, meal kits - everyone wanted to build India’s Dollar Shave Club. By 2020, most were gone. My Ayurveda brand tried too, even with 6–9 month purchase cycles, it didn’t work. Cut to today, a very different picture.I recently spoke to 3 founders running subscription businesses. All launched post-2022. All profitable. One doing ₹50-1000 Cr+ ARR with 65% retention at month 6. That got my attention. So I spent the last few days digging into why it's suddenly working. Why did FAB BAG, Doctalk, Doodhwala, Otipy fail but today's winners are killing it? The answer came down to two words: UPI AutoPay. The successes: → Kuku FM: >12 M+ paying subscribers for regional audio-video content (our first investment at @V3 Ventures India) → Country Delight: Daily milk delivery via subscription, does ₹600+ Cr in revenue → Wholsum Foods (Slurrp Farm and Mille): Kids nutrition products on weekly/bi-weekly subscription. Parents don't want surprises, they want the same healthy millet cookies delivered automatically. Aisha is a big customer → Licious: Meat subscription component growing fast. You pick your cuts, they deliver weekly What changed? 1. UPI solved the payment problem: 131 billion UPI transactions in 2023. Auto-debit on UPI is now seamless. It had a lot of friction in the past. This has led to what one founder told me: "COD customers churn at 40%. UPI auto-debit customers churn at 12%. Payment method is the business model." 2. Q-Com also proved daily delivery is possible: When Zepto can deliver groceries in 10 minutes, milk every morning doesn’t sound crazy anymore. Cold chain, reliability, last-mile ops - all the boring things finally clicked. 3. Model Shift: Replenishment > Discovery, Subscription in India isn't about trying new things. It's about auto-delivering stuff you already buy by removing friction & making customers loyal. Indians now buy the same atta, same milk brand, same baby food every week. Subscriptions just automate what we'd do anyway - with a small discount as incentive. So, what works is obvious now Category: Consumables (milk, eggs, baby food, meat)  Frequency: Weekly/bi-weekly (monthly too long)  Discount: 5-15% ( like Country Delight’s early-bird plans)  Flexibility: Easy skip/cancel (trust builder)  Payment: UPI auto-debit (not COD) After a decade of failed experiments, subscription commerce has finally found its moment in India and it looks nothing like the US playbook. The brands that understand this will build annuity businesses in categories everyone else is fighting for one transaction at a time. The question: there’s been talk of consumers forgetting their upi auto pay subscriptions. Will this be regulated/some friction be added?

Data vs Bundle vs Churn I promised not to post this until Monday, but I figured many of you could use something to help you sleep on your flights to #CannesLions, so I’m posting a day early… Sue me! Last week, Antenna released their Q2 State of Subscriptions Report. Their data, as always, is totes telling. The retention rate for Media’s premium streaming platforms has fallen 73% in just two years. Which explains why we see Media CEOs scrambling for bundles to address this crisis. So, since #bundling is the streaming move du jour, today let’s zoom in on the balance of #bundles vs. #churn. Antenna offers cancellation data for Disney Streaming’s bundle (Disney+, Hulu & ESPN+) versus the three services individually; AND for AppleTV+ churn compared to their Apple One bundle. Disney+ averages churns of 4.5%; Hulu 4.8%; ESPN a precarious 7.9%. Together they average churn of 5.7%. However, the Disney Bundle churns at just 3.17% - a reduction of 45% off the total for the three. Impressive. BUT… it’s a 30% mitigation for Disney+; 34% for Hulu; and 60% for ESPN. That’s Bundling Lesson #1: Bundles will ALWAYS benefit the weaker antelopes in the herd. Stronger streamers will also get lower churn, BUT they’ll also get less money per sub, every month, making the bundling benefits murkier over time. The average churn rate for AppleTV+ is WAY above industry norms - a dangerously high 8.25%. Among streamers only Starz is higher. However, when Apple bundles their TV service with Apple One (a smorgasbord of TV, Music, Gaming & Cloud), AppleTV+ churn falls near Netflix levels to 2.9%. That’s a massive reduction of 65% off their total cancellation rate. It’s also 9% lower churn than the Disney Bundle. Which begs a BIG question for Tim Apple: WHY DOESN’T APPLE MARKET APPLE ONE BETTER‽ Seriously. Why are they not all-in on Apple One all the time? In both cases, the convenience of one bill for many services, plus cost-savings, greatly helps lower churn across the board. But the data from some of the lowest & highest churners in streaming offers Bundling Lesson #2 for Media of all colors: Utility (sports services for Disney; audio and cloud services for Apple) are key ingredients for alleviating cancellations - even for already low-churning services. Adding same to same WILL help the high-churners, BUT the data indicates that, for the lower churners like Hulu, Disney+, and Netflix (SEE: Comcast’s StreamSaver), the bundling juice will very likely NOT be worth the pricing squeeze. This will be equally true for Gaming, Audio, News, and any other services looking to partner in order to lower churn. Which leads to Bundling Lesson #3: Bundling is a science. The more data you get, read, and digest, the stronger your bundling thesis will be. To get all the bundling data that’s fit to print, as well as my complete Bundling Dissertation, do your research and hit the link: https://lnkd.in/eZjyquCu Profite de ta semaine!

As a corporate SaaS lawyer, I want to dive into two common types of agreements that drive the tech world: Software as a Service (SaaS) Agreements and Professional Services Agreements (PSAs). Let's break them down: A) Software as a Service (SaaS) Agreements These govern cloud-based software accessible via the internet, revolutionizing how we interact with technology. Key features include: -User limits and prohibited actions: SaaS Agreements outline restrictions like sharing access or reverse engineering, protecting the vendor's IP. -Service Level Agreements (SLAs): These guarantee uptime, support availability, and response times, ensuring reliable service. -Data ownership and security: Critical provisions define data ownership, post-contract data handling, and breach protocols. In today's data-driven world, these can't be overlooked. -Subscription-based pricing: Typically monthly or yearly, allowing for flexibility. -Users should understand renewal processes and potential price changes. B) Professional Services Agreements (PSAs) Covering skilled services like consulting and data analysis, PSAs focus on project completion and deliverables. Notable aspects include: -Statement of Work (SOW): This detailed document outlines project scope, deliverables, timelines, and performance metrics. -Performance specifics: PSAs address service location, deliverable ownership, and acceptance criteria, preventing misunderstandings. -Flexible payment structures: Options range from prepayment and hourly rates to fixed-price or milestone-based payments, adapting to project needs. -Work product ownership: Clear terms on who owns what and when ownership transfers are crucial, especially for IP-intensive projects. Understanding these agreements is vital in our tech-driven landscape. As technology evolves, so do these agreements. They're not just legal documents – they're the foundation for innovation and collaboration in our digital age. B Clear, well-structured agreements prevent disputes and protect all parties' interests. They're the unsung heroes of the tech world, enabling the seamless service delivery we've come to expect in modern business. Remember, in the fast-paced tech industry, knowledge of these agreements isn't just useful – it's essential. #legaltech #innovation #law #business #learning

The Surprising Truth About Subscription Models: It's Not About Locking Customers In! Are you trying to lock your customers in, or are you giving them the freedom to choose? Traditional subscription models focus on retention, but what if we flipped that on its head? What if we designed our subscription models to prioritize customer freedom and flexibility? 🤔 Reflect on this: 1️⃣ Are you punishing customers for canceling their subscription, or are you making it easy for them to come back? 2️⃣ Are you offering a one-size-fits-all solution, or are you giving customers the flexibility to choose what they need? 3️⃣ Are you prioritizing short-term gains, or are you building long-term relationships? 💡 Tips for businesses: 1️⃣ Focus on customer lifetime value, not just retention: Prioritize long-term relationships and calculate customer lifetime value to maximize revenue and loyalty. 2️⃣ Offer flexible plans and pricing to meet customers where they are: Provide personalized options to suit different needs and budgets, increasing customer satisfaction and loyalty. 3️⃣ Make it easy for customers to pause or cancel their subscription (and come back!): Streamline the process and remove penalties to encourage customers to return when needed. 4️⃣ Prioritize customer feedback and iteration to improve your subscription model: Continuously collect feedback and make data-driven changes to enhance customer experience and retention. Remember, the goal of a subscription model isn't to trap customers, but to build a loyal community of fans who choose to stick around. #SubscriptionModel #marketingstrategy #Loyalty #thoughtleadership #thethoughtleaderway

Marketing leaders who run Paid Ads + a Freemium motion need to be locked in; this is a dangerous game. This didn't hit me until I attended the PLGTM conference in SF last week. Paid ads? A click to your website shows some level of intent. Sign up for free version? A login on your website shows a high level of intent. But typically your free version is supposed to separate your organic traffic into lookie-loos vs real intent who aren't ready to talk to a sales person. ⚠️ The Problem: If you're spending $800 to acquire a customer, and acquisition means a sign up for your free tier, but only 3% of freemium users convert, your effective CAC per paying customer skyrockets. Let's compare free user conversion vs book a demo conversion: - According to Lucid Financial, freemium models typically convert only 2–5% of free users to paid customers. Warmly is at 3% - According to Saastr, conversion rate from a booked demo to a paid customer typically ranges between 10% and 20% depending on ACV & show rates. Warmly is at 12%. So when we spend $$$ on ads to drive traffic to the website - it is 4x more expensive for us to have someone sign up for free than to take a demo with us. Or said another way, our free version needs to have a 4x higher sign up rate than our book a demo button to get the same conversion. ‼️ Gut check: - typically smaller ACVs sign up for free while bigger ACVs sign up for a demo. We only target bigger companies with ads. We see this in our data - free tier users can take years to convert when they have less urgency. We see this in our data - free tier users can self-serve purchase which is less expensive than a sales motion - free tier users who are happy drive more organic referral traffic because they have friends with money. Thanks free tier users! Conclusion: Make sure you're tracking conversion rates vs your CTAs especially if you're spending to acquire traffic Warmly, Max ps. Idea we're going to try: sending our paid traffic to a landing page where the only CTA is to book a demo

Our most underestimated pricing strategy? Subscription models. It’s tempting to think pricing is just about one-time sales, but subscription models are rewriting the rules. They’re more than a trend—they’re a strategy for sustained growth and loyalty. Here’s why subscription models matter: → Predictable Revenue Steady, recurring income helps businesses plan better and weather market fluctuations. → Stronger Customer Bonds Subscriptions aren’t just transactions—they build relationships. Convenience, value, and personalization create loyalty. → Tiered Flexibility Different customers, different needs. Tiered plans let businesses cater to everyone—from budget-conscious shoppers to premium buyers. What about dynamic pricing? It’s another game-changer. Static pricing is out. Real-time adjustments are in. → Real-Time Adjustments Dynamic pricing powered by AI reacts to market shifts, competitor moves, and customer demand instantly. → Data-Powered Decisions AI sifts through trends, behaviors, and sales data to find optimal price points—no guesswork required. → Market Responsiveness Inflation or demand spikes? Proactive price changes keep you competitive without alienating customers. So, how do you stay ahead? 👉 Leverage Technology: Adopt AI tools to fine-tune your pricing and uncover opportunities. 👉 Stay Flexible: Pricing isn’t static—test, learn, and adapt as markets evolve. 👉 Prioritize Value: Show customers why your pricing reflects the value you provide. Subscription models and dynamic pricing aren’t just innovations—they’re the future of profitability and customer loyalty. What’s your strategy for embracing these trends? Let’s dive into it!

Coaches, let’s talk newsletters. Growing up isn’t the hard part, keeping people reading is. I was talking to a coach last week who said: "My newsletter had 800 subscribers… but every week, people kept unsubscribing. I’m adding new people, but losing old ones. Feels like a never-ending loop." Sound familiar? The truth is that subscriber growth is exciting, but it means very little if people don’t stick around. Because real value comes from retention. From turning passive readers into engaged fans who actually open, read, and even buy from you. So let’s break down what keeps your audience hooked 👇 🧠 What Makes People Stay? Subscriber retention isn’t just about sending a “great” email. It’s about psychology. Here’s what your readers want (and what most coaches miss): ✅ Consistency — Show up like clockwork. Make opening your email a habit for them. ✅ Connection — Make your content feel like a conversation, not a broadcast. ✅ Value — Teach them, inspire them, or shift their mindset every time. No fluff. Personalization Wins A McKinsey study showed: → 71% of people expect personalized content. → 76% get frustrated when it’s all “me, me, me” instead of “you.” So stop using your newsletter to only talk about yourself. Instead: 🔹 Segment your audience – Are they beginners or advanced? Coaches or clients? 🔹 Share relevant stories – What real problems do they have? Speak directly to those. 🔹 Use simple tech – Tools like ConvertKit or Customer.io help automate smart content journeys based on your reader’s behavior. 💡 Case in Point: A Coach Who Fixed Her Churn One of our clients was losing 5-6 subscribers every week. We paused the regular “salesy” emails and shifted focus to high-value insights, short stories, and light mindset tips. Result? → Unsubscribes dropped by 25% → Replies went up → 3 booked calls in 2 weeks from her email list alone Moral of the story? Don’t just send emails. Send value. 🔧 Tool of the Week: Customer.io If you’re running a newsletter and want to automate smart, behavior-based follow-ups, this tool is gold. ✅ Personalized content journeys ✅ Re-engagement automations ✅ Works like magic with small teams Before you go, tell me 👇 What’s one thing YOU do to keep your audience engaged? Drop your answer in the comments or reply “ENGAGE” and I’ll send you a few newsletter prompts that always get high open rates. #EmailMarketingForCoaches #NewsletterGrowth #PersonalBranding #ContentRetention #CoachingBusiness