Amazon FBA Subscribe & Saved Program: Explained (2021)

Amazon FBA Subscribe & Saved Program: Explained (2021)

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Gaining loyal customers who keep coming to your brand sounds like a dream, especially when you are selling in an uber-competitive marketplace like Amazon, where your competitors can snatch away your customers right before they click on the Add To Cart button. Sigh! However, with the Subscribe & Save program, you can increase recurring revenue and cultivate loyal customers. Sounds interesting (and profitable)? Read on to know everything about this program.

What is Amazon Subscribe & Save program

What is Amazon Subscribe & Save program

This program allows Amazon shoppers to sign up for regular, scheduled deliveries of the product they frequently use and purchase, for example, vitamins, toilet papers, baby diapers, pet food etc. This encourages customers to shop from your brand rather than finding a “better/cheaper option” every few weeks. Any shopper who enrolls in the program will save around 5-15% on the items. So, it’s a win-win situation for both. The shoppers get a base discount and free shipping for the product they regularly purchase, whereas sellers can effectively forecast the demand and benefit from a recurring purchase. Shoppers can choose a shipment schedule of every two weeks to every 6 weeks.

Fun fact: According to Jungle Scout, about 51% of Amazon Prime members use Subscribe & Save

Is there a fee?

No, it’s free to use for all eligible sellers.

Requirements & eligibility criteria for Subscribe & Save program

All FBA sellers can include their eligible FBA offers in Amazon’s Subscribe & Save program. However, it’s not eligible for all the products. Today, Subscribe & Save is available in the following categories:

  • Health and Personal Care
  • Beauty
  • Office Products
  • Baby
  • Electronics
  • Grocery & Gourmet Foods
  • Home and Kitchen
  • Pet Supplies
  • Sports, Fitness and Outdoors
  • Car & Motorbike Accessories
  • Personal care appliances
  • Lawn and Garden
  • Apparel
  • Luxury Beauty
  • BISS (Business Industrial and Scientific Supply)
  • Personal Computer

If your products are not listed in the above-mentioned categories, they are not eligible for Subscribe & Save.

The eligibility criteria

  • From December 18, 2019, only Brand Registered sellers can enroll their products in Subscribe & Save.
  • ASIN must be in FBA for 3 months or longer
  • ASIN and SKU should be active at the time of enrollment
  • ASIN and SKU should not be enrolled in any other program that could affect Subscribe & Save
  • ASIN and SKU should have a strong history of being in stock
  • Sales performance of ASIN should exceed Amazon’s internal requirements
  • Performance metrics should be up to the mark. Poor account health or performance metrics can affect your ability to participate. Apart from that, Amazon will also consider your Subscribe & Save order cancellation rate, seller feedback (4.7 or even higher) and FBA inventory performance. If you don’t comply with the metrics, schedule a meeting with your Amazon seller consultant

How to enroll?

As of December 2019, eligible products will be automatically enrolled. You can visit the Manage Subscription Products page to see which products are enrolled. If sellers do not have the option to enable Subscribe & Save but are eligible you can ask your Amazon seller experts  to contact Amazon support or send an email to fba-sns-help@amazon.com.

What are the discounts you can set up with Subscribe & Save

What are the discounts you can set up with Subscribe & Save

If your products are enrolled in the program after November 5, 2019, 3 tiered discount rates apply to all the categories. Sellers can choose from the following three base discounts:

  • 0%
  • 5%
  • 10%

For example:

  • If a seller chooses to offer 0% discount, customers will get 0% discount for up to 4 subscriptions and a 5% discount rate for 5 or more subscriptions on the same delivery date.
  • If a seller chooses to offer 5% discount, customers will get 5% discount for up to 4 subscriptions and a 10% discount rate (5% from seller and 5% from Amazon) for 5 or more subscriptions on the same delivery date.
  • If a seller chooses to offer a 10% discount, customers will get a 10% discount for up to 4 subscriptions and a 15% discount rate (10% from seller and 5% from Amazon) for 5 or more subscriptions on the same delivery date.

Amazon will fund an additional 5% discount (for a limited time) regardless of which base discount sellers choose. This means that if a shopper has five or more subscriptions delivered on the same delivery date, they will receive an additional 5% discount from Amazon at no cost to the seller. As a seller, if you choose to provide a 5% discount, you are only responsible for the funding the 5%. Coupons and promotional discounts are still applicable on Subscribe & Save ASINs, so better do the math before running any promotions on those ASINs.

If your product is enrolled before November 5, 2019, the below category fee applies:

Product category Seller-funded discount
1-4 subscriptions in one delivery
(to the same address)
Seller-funded discount 
5+ subscriptions in one delivery
(to the same address)
Beauty 5% 15%
Grocery 5% 15%
Health & Baby Care 5% 15%
Automotive Parts & Tools 5% 10%
Electronics 5% 10%
Home Tools & Home Improvement 5% 10%
Industrial Supplies 5% 10%
Kitchen 5% 10%
Lawn & Garden 5% 10%
Musical Instruments 5% 10%
Office Supplies 5% 10%
Outdoors 5% 10%
Pet supplies 5% 10%
Sports 5% 10%
Toys 5% 10%

 

Tip: Amazon suggests giving sellers a 10% discount and claims that products at 10%/15% discount can drive a 1.8X increase in conversion over no discount at all.

How to measure Subscribe & Save results?

How to measure Subscribe & Save results?

You can test the impact for the program in the Subscribe & Save Manage Products dashboard. The performance dashboard shows the following metrics:

  • Shipped units
  • Shipped revenue
  • Subscriptions count
  • Not delivered due to out of stock
  • Average revenue per customer
  • Planned revenue
  • Planned units

There are two useful reports available that give you an insight into inventory and pricing:

  • Subscribe & Save (SnS) performance results report
  • Subscribe & Save (SnS) forecasting report

The Forecasting Report helps you determine the number of units required to fulfill subscriptions. Sellers get data for up to 8 weeks in advance. While the Performance Report shows the number of items shipped, the % of orders missed because of being out of stock, average post-discount sale price and more. You can leverage this data to better plan and manage your inventory levels and pricing.

To find these reports, hover to the Reports tab and click on Fulfillment. Again, on the left-hand side of the page, under inventory, you’ll see Subscribe & Save Forecasting. Just download the excel sheet to view the data.

How can you encourage the shoppers to enroll in the program?

Using irresistible, limited-time coupons is the perfect way to get attention from a serious buyer to lure them to subscribe. Once they purchase, they’ll want to keep coming for more. Because Subscribe & Save is a set-it-and-forget-it thing, shoppers will get their supplies every few weeks without having to reorder. For sellers, just by investing in coupons, they can gain a loyal customer and get the benefits of repeat purchases regularly.

Is it even necessary?

If you are eligible and sell consumer goods that are frequently purchased, it’s a no-brainer. If you are selling consumable, single-use products through FBA, you should definitely enroll in the program. By offering a discount, you are securing future purchases and encouraging the shopper to purchase an additional product from your catalog. Instead of looking at the competitor’s products for a better deal, they’ll return to you and get a constant supply of essentials they need, when they need. In exchange for the loyalty, they are rewarded with a discount by you and it’s very difficult for the shoppers to say no to a discount. And customers can cancel anytime they want, so they don’t feel overly committed. This increases the chances of them subscribing for your product. Here are a few benefits of the program:

  • Repeat purchases: Repeat purchases are always profitable. There is a saying that “It costs more to obtain a customer than to keep one.” Because the shoppers are signing up to buy exclusively and regularly from you, your customer acquisition costs will below. It won’t be an exaggeration to say that this program is probably the cheapest way to receive repeat purchases.
  • Builds customer loyalty: Although the shoppers are not locked in an offer, they feel tempted to buy from you because of the discount and convenience. So it’s not a surprise for sellers enrolled in the program to see a jump in sales. And shoppers are more likely to view and purchase other products from your catalog.
  • Improve brand recall & get benefits of word of mouth: Human beings are social creatures and happy customers will share their experience with those in their circle. This can work wonders for your brand. If you are committed to providing an excellent customer experience (pre and post), your shoppers are more likely to recommend your product and brand to their friends and family. And because your products are shipped to their house on a regular basis, your brand name is going to be on the top of their minds.
  • Great for product launches: If you have a new brand and want to improve brand awareness, consider using the Subscribe & Save program. You can gain the trust of your first-time shoppers and secure future sales, thus gaining momentum in sales

Secure future purchases with Subscribe & Save

Clearly, Subscribe & Save is a surefire way to ensure that your customers keep coming back to you. Always remember, your shoppers won’t subscribe right away. It is crucial that you provide them with a wonderful first-time purchase experience. If they are happy, they will subscribe and you can lock in future sales without any additional cost of new customer acquisition. Hope this article helped you understand the program and its eligibility requirements. If you need any help setting up your products for Subscribe & Save, you can always take help from our Amazon consultants.

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