Once upon a time, before I had the twins, I use to be a gamer. You would find me when I wanted some downtime playing my Xbox. I am a little fussy on my game type, RPG, so when I ran out on my exclusive Xbox games, I moved to PS (to play their exclusive platform games). But with a new release game coming soon only on Xbox or PC, I needed to move back. This is where the story begins – what membership subscription should I buy?
Like with many entertainment service providers (Netflix, Amazon, and Spotify come to mind), Microsoft has a paid subscription model for Xbox users. I personally prefer a set and forget yearly subscription, but Microsoft have removed this option. The options that are available to pay by the month include Ultimate, Gold Pass, PC or console (note: Xbox Gold is ending in Sept 2023 and will be replaced by Game Pass Core).
There are a lot of benefits for a business-like Microsoft in using a subscription model in their loyalty program:
- Predictable revenue: Subscription loyalty programs offer a steady and predictable stream of revenue for businesses (positive cash flow). This is because customers pay a recurring fee to be part of the program, ensuring a consistent income for the company.
- Customer retention: By offering exclusive perks and rewards, subscription loyalty programs encourage customers to stay engaged and loyal to the brand. This can lead to increased customer retention rates and reduce churn.
- Increased customer engagement: Members of a loyalty program tend to engage more frequently with the brand to earn and redeem rewards. This heightened interaction can foster a stronger emotional connection between the customer and the brand. Brands should look to make members brand advocates.
- Data collection and personalisation: Subscription loyalty programs enable businesses to collect valuable customer data, including preferences, behaviours, and purchase patterns. This data can be used to personalise offers and marketing messages, enhancing the overall customer experience. With the future changes to data privacy laws and death of cookies, the safety of data and its use is invaluable to a business.
- Upselling and cross-selling: With access to customer preferences and buying habits, companies can target specific products or services to subscribers, promoting upselling and cross-selling opportunities.
- Brand advocacy and word-of-mouth: Satisfied subscribers are more likely to become brand advocates, spreading positive word-of-mouth about the company, its products, and the loyalty program. This can lead to organic growth and new customer acquisitions. For Microsoft, it is about the exclusive content and shareability with friends.
- Competitive advantage: Subscription loyalty programs can differentiate a brand from its competitors. When designed well, they can serve as a unique selling point that attracts and retains customers who seek ongoing benefits and value.
- Flexibility and scalability: Subscription loyalty programs can be adapted and scaled to meet the needs of different customer segments and accommodate business growth.
Choosing a subscription plan
When reviewing the different plans, it is evident I will be rewarded by choosing the Ultimate. To be honest, it is only between the Gold or the Ultimate and that is because Microsoft is using a tiering loyalty program. As a customer paying more, I have access to more. The Ultimate offers a unique set of perks and benefits, which are exclusive offers, discounts, early access to products, and more.
Reviewing their program and remembering how great the free games could be – I decided to purchase Ultimate. The process to join was smooth – just purchase through my existing account. Now I have access to a whole range of games that I would never traditionally purchase.
Microsoft has joined the bandwagon of monthly subscriptions (removing the option for yearly). This is disappointing but the $1 joining fee is very attractive. My only watch out is now Microsoft is dependent on loyalty to continue the monthly renewal over a banked 12mth subscription. The content is an additional bonus to allow more sampling of game types.
I found the experience to compare tiers simple thanks to the clear comparison tables Microsoft illustrated on their website. Even the purchase journey was easy. Overall – a good program for those who will use it.