Target's New Subscription Service for Baby Supplies Worth Noting, Says Cloud Billing Expert

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Aria Systems today observed that major retailer Target Corp’s recent launch of a subscription service for certain baby products is a significant marker in the transformation of the traditional retail sector towards recurring revenue business models.

When it comes to generating sales and profits, Target and other large retailers are discovering the power of giving their customers more purchasing options.

Cloud billing expert Aria Systems today noted that Target Corp.’s recent launch of a subscription service for the bulk sale of certain baby products is further confirmation that the subscription model for recurring revenue is rapidly expanding to the traditional retail sector.

“We’re not surprised by Target’s new service,” said Brendan O’Brien, Chief Architect and Co-Founder, Aria Systems. “Recurring revenue sales are no longer just for movies and music. We’ve been saying for years that larger retail enterprises will soon be using recurring revenue models to open up new channels to increase overall sales and profits. What does surprise us is how quickly retailers are adopting these models.”

The online “Target Subscriptions” service, introduced in late September, offers moms and dads automatic delivery of basic infant supplies every four to twelve weeks. Subscribers pick from a list of 150 brand-name items what they need, such as diapers and formula, in what quantity, and on what day they want their order delivered. Target emails alerts ten days ahead of shipping to give customers the opportunity to adjust their standing orders. Delivery is free.

The service seems to be Target’s response to the impact of Amazon.com Inc. on the U.S. retailing industry, which has its own recurring subscription diaper service for parents. Other large retailers, such as Wal-Mart Stores Inc., have also been experimenting with recurring subscription models as physical store sales slow or stall.

Target says that with this announcement it becomes the largest retail service to offer the bulk sale of baby products with the introduction of the new service.

“Target has listened to what customers want in terms of new services, and has responded to those requests,” said O’Brien. “When it comes to generating sales and profits, Target and other large retailers are discovering the power of giving their customers more purchasing options.”

Large enterprises in both the public and private sectors are becoming increasingly aware that, to achieve and maintain customer satisfaction and retention, they must give customers as much choice as possible, be as flexible as possible, and have a system that enables that flexibility.

Aria Systems facilitates this increase in customer choice with its cloud-based system for managing recurring revenue. Whether the business model is single-transaction, usage- or subscription-based, or a hybrid of any of these models, Aria Systems can help ensure that companies can offer each and every market segment the optimal pricing model without the limitations imposed by legacy billing systems.

For more information about how adding a recurring revenue option to your business can generate new income streams and improve customer lifetime value, download the recent ePaper “The Right Recurring Revenue Model for Success.” The paper examines the latest trends and details of the basic recurring revenue models, and highlights a variety of pricing “tactics,” including “freemium,” pre-paid, post-paid, tiered, trials, promotions and unlimited usage that can be used to optimize revenue streams.

About Aria Systems
Aria Systems powers recurring revenue for the enterprise by enabling market expansion, improving customer relationships, and providing more revenue predictability. Aria is used by brand name companies such as Pitney Bowes, AAA NCNU, Experian, Red Hat, Ingersoll Rand, EMC, VMware, and HootSuite to evolve their recurring revenue businesses while delivering outstanding customer experiences. Visit http://www.ariasystems.com or call 1.877.755.2370.

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Marie Martin
Aria Systems
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