Gift Subscriptions in eCommerce: How They Work & Why You Should Offer Them

Gift subscriptions create a win-win for both merchants and customers. Their charm lies in their unique capability of delivering recurring gifts. It allows the recipients to enjoy products or services at regular intervals. Plus, receiving a series of gifts can sound way more exciting than receiving one-time surprises.

Gift subscriptions combine the elements of surprise, personalization and convenience together to give both the gift buyer and the recipient unique purchase experiences. While they definitely are appealing to customers, they also give businesses the chance to strengthen their subscriber base, and improve retention.

Let’s look at gift subscriptions more closely, and also find out how to manage them the best way.

How Gift Subscriptions work?

Gift subscriptions are a unique subscription type that involves two kinds of users: the buyer and the recipient. The buyer is responsible for paying the subscription fees, while the recipient simply enjoys the subscription product or service as a gift.

If physical products are to be gifted (as is often the case), then the buyer provides the recipient’s delivery address directly. Instead of their own. Popular examples of gift subscriptions in ecommerce include customized crates (subscription boxes such as snack, skincare, beauty, and coffee kits), books and magazines, replenishment items, and digital services like music streaming.

Gift subscriptions are gaining popularity because the subscription model itself is becoming widely utilized. As per the recent figures, most of the consumers are subscribed to more than one service. That indicates that customers are already accustomed to the concept of subscription, and they prefer the convenience and continued service that it offers.

Gift subscriptions VS Regular Subscriptions: How they differ?

Why bother with gift subscriptions, when users can simply buy regular subscriptions and pass them on as gifts? The answer is that while this is indeed possible, it is far less efficient than signing up for an actual gift subscription.

So how do gift subscriptions differ, and what makes them a better gifting option compared to regular subscriptions? The answer lies in these key differences between both the subscription types:

1. Gifting duration

Gift subscriptions have a limited duration as compared to regular subscriptions that can renew endlessly. The gift sender selects this duration when they sign up. The subscription term can be 3 months, 6 months, 12 months or a custom number of months.

In this duration, the recipient typically receives the gift every month. But when the gift duration ends, the subscription also gets auto-cancelled unless the recipient themself wants to become an active subscriber at that point.

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2. Activation as per user’s request

Regular subscriptions activate as soon as the payment is made. But that’s not the case with gift subscriptions. They can be activated on the date the user desires. This feature suits the needs of those users who may be interested in purchasing a subscription first, but not immediately gifting it.

They instead prefer that the recipient enjoy their gift on a particular date. Therefore, the gift subscription best suits them since they can choose their start date at their convenience.

3. Recipient activation

Sometimes, subscription activation requires the recipient’s authorization as well. For example, the business asks the recipient to provide a code that verifies them as the rightful recipient. This feature is also absent in regular subscriptions as there the subscriber directly subscribes, and doesn’t require third party verification.

4. Customization

The sender can make a number of customizations to personalize the gift subscription. For instance, they can include personal messages, delivery notes, and select the delivery schedule of their own choice.

5. Payment flow

The gift sender is responsible for all the payments, not the gift recipient. So, one party pays on a recurring basis, and the other party receives the services. Recipients aren’t required to pay. Such flexibility isn’t present in regular subscriptions as there, those using the service also have to be the ones paying for it.

6. Acquisition channel

Gift subscriptions open up a unique acquisition channel for the merchants. They introduce more people to their products and services, and deliver elite limited-time experiences.

If recipients get impressed by the services, it doesn’t matter if their gift duration ends. They can still continue their services by converting their gift subscriptions into regular ones, and becoming active payers themselves.  

Why Gift Subscriptions are a win for Merchants and Customers alike

Gift subscriptions allow merchants and customers to enjoy all these benefits:

• Customer acquisition

Gift recipients are potential customers themselves. That’s because they get to experience your service value for free and this experience might be persuasive enough to convert them.

Moreover, having a gift subscription option separately in your store attracts more customers toward it. Those who might not have known about gift subscriptions previously are introduced to this concept, and they may become interested in buying one.

• Foreseeable revenue

Gift subscriptions also bring in predictable revenue for their specific duration, as the gift sender regularly pays for the number of billing cycles they selected at the start. It is less probable for this subscription to be cancelled midway as it’s purchased as a gift with a fixed duration.

So, the gift sender is more likely to continue with the payments until the set duration expires. This means that ecommerce merchants gain stable revenue for that time period.

• Seasonal revenue boost

These subscriptions become more popular in the holiday seasons as they are associated with gift giving. So, the businesses might see a spike in their revenue during seasons like New Year’s, Valentines, and Thanksgiving etc.

Gift subscriptions give them an excellent opportunity to boost cash flow during these seasons, even if their regular subscription volume remains steady.

• More convenience for gift sender and recipient

Imagine not offering gift subscriptions and customers having to buy regular subscriptions as gifts. There are too many downsides to it. Firstly, there will be no recipient-related personalization involved. Secondly, the subscription won’t activate at will, and product delivery dates won’t align with the user’s wishes.

Moreover, the subscription notifications will target the sender, not the receiver. The same subscription account will have to be shared between the sender and receiver, requiring manual password exchange. Plus, receivers won’t be able to freely track their future order deliveries.

But a separate gift subscription option does away with these challenges. It offers special features that mimic how people actually give gifts better.

Use SubscriptionFlow for Best Gift Subscription Management

Once you decide to offer gift subscriptions in your ecommerce store, the next step is implementing this feature, and continuously managing it. SubscriptionFlow is your trusted partner when it comes to that. Here are the reasons why:

• It works with multiple ecommerce sites

SubscriptionFlow works with a range of popular ecommerce platforms. Examples include Shopify, Wix, WooCommerce and BigCommerce. Thanks to its easy integration capability, merchants can smoothly incorporate the software into their operations, and use it to manage subscriptions of all types—especially gift subscriptions.

• Gift subscriptions can be set up with ease

Setting up gift subscriptions is as easy as it can get. Merchants don’t require professional developer support for that. They can create gift subscription products, and add this feature to their store with only a few clicks. The quick setup process allows them to start acquiring gift buyers faster as well.

• Gifting durations can be customized

Merchants can offer multiple gifting durations to buyers. For example, monthly for 3 months. They can also allow users to create a custom duration, such as every three weeks. The software can handle multiple subscription cycles at the same time, and also ensures that all the parcels are dispatched accordingly.

• Gifts can include both physical and digital products

Whether you sell physical product subscriptions or digital services, SubscriptionFlow supports gift subscriptions in both cases. It manages both types of accesses efficiently, and can ever bundle them together for hybrid service deliveries.

• Buyers can add recipient details for delivery and personalization

The buyer can fill in the address fields with the recipient’s address and can also provide other information such as the recipient’s name and email. This information is helpful in personalizing messages to the recipient, and giving them a surprise product delivery.

• Notifications to recipients are automated

Whenever the subscription period starts, the recipient can be automatically notified. This builds transparency, as it keeps the gift sender and recipient on the same page. The recipient can also track their upcoming gift deliveries, so they don’t have to rely entirely on the sender for that.

Start offering gift subscriptions today. Let SubscriptionFlow handle all the management for you.