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Pricing

eCommerce glossary

All the terminology you’ll ever need, together in one place. We can even let you know when new terms are added.

Subscriptions

A subscription is an agreement to pay a recurring amount of money in return for a good or service. This could be for a physical product, like a magazine, or a digital product, like AfterShip.

The benefit to the customer is that the cost of the service or good is spread across multiple payments, as opposed to a single large upfront cost. Some subscription models allow the customer to cancel during their subscription period, again a huge benefit to the customer if they discover the good or service is no longer needed or suitable.

Subscription payments could occur weekly, monthly, annually, or however, the merchant decides. Take AfterShip for example, we offer a monthly or annual subscription model for all our plans. The exception being the Enterprise plan which is customized for each customer.

Offering a subscription model has become more and more common. Spreading the cost means companies can offer more affordable prices, making it less intimidating to customers. This is all part of the transition to what’s known as the membership economy, where the shift is from ownership to access. It allows companies and customers to build meaningful long-term relationships. Companies now, more than ever, are encouraged to provide meaningful services and goods that help retain customers since with most subscriptions, customers can leave if they find the product is no longer useful.

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