This article was written by Jungle Scout ecommerce experts with some assistance from artificial intelligence.
As an Amazon FBA seller, it’s crucial to utilize all the tools that can help increase your sales and grow your business. One of the most powerful features available is Amazon Subscribe & Save, which allows customers to schedule recurring orders of products they frequently purchase.
It’s a great way for Amazon sellers to retain customers and increase recurring revenue for your business
Here’s how it works:
Product. Customers select the Subscribe & Save option for the products they want to receive regularly.
Frequency. They choose how often they want the products to be delivered (monthly, every two months, etc.).
Shipping. Amazon automatically ships the product to them on the selected schedule.
Customers receive a discount on the product, usually around 5%, and they can cancel or modify their subscription at any time.
Amazon Subscribe & Save is especially valuable for those who sell some type of consumable or single-use product that customers would need to reorder monthly, such as:
In this article, we’ll explore how Amazon Subscribe & Save works, show you how to use it and investigate its potential impact on your FBA business.
How Amazon’s Subscribe & Save works
With Amazon’s subscription model, sellers can give their customers the option to automatically reorder their products, as well as how frequently they want to receive them.
For instance, if you sell a supplement with a 30-day supply, your customers can automatically receive an order once a month — without having to sign in and click that ‘order’ button again.
Typically, when a customer chooses to subscribe to a product, they will receive a small base discount which is set and funded by the seller (and in some cases, an additional 5% from Amazon) ranging from 0% to 15% (more on the discounts below).
Two Types of Subscribe & Save Orders:
Initial sign-up order. The customer selects to subscribe in the Buy Box while choosing their desired frequency.
Replenishment order. These orders are automatically placed based on the frequency the customer has chosen in the initial sign-up order.
You can see how Amazon’s Subscribe & Save would be beneficial to the buyer — but what about the sellers?
How Amazon’s Subscribe & Save feature benefits sellers
According to Jungle Scout’s Consumer Trends Report, 35% of all U.S. consumers have purchased products using the Subscribe & Save option — and most of those plan to continue doing so. Another 36% of consumers would consider subscribing to a product in the future.
Amazon loyalists are more likely to purchase using Subscribe & Save:
51% of Amazon Prime members have used it
45% of consumer who consider themselves “brand loyal” have used it
This alone gives sellers a huge opportunity to secure future purchases and revenue. If you sell some type of consumable or single-use product, enrolling in Subscribe & Save can give you a guaranteed way of locking in future sales while staying competitive in the marketplace.
Other key benefits of Amazon Subscribe & Save for sellers include:
1. Gain consistent repeat sales:
The best part of this subscription feature is that it gives customers the option to “set it and forget it” when it comes to making a purchasing decision. They don’t have to remember what brand they ordered from or how to find it; their products just show up at their door.
This gives sellers a huge advantage because it allows you to lock in future sales.
And data from our Consumer Trends Report indicates that the Subscribe & Save model is here to stay on Amazon:
82% of Subscribe & Save customers say they value being able to shop on Amazon
75% say that if they were only able to buy products from a single store, it would be Amazon
64% would describe themselves as “brand loyal”
And customers who use Subscribe & Save could become increasingly loyal and drive significant revenue for certain sellers:
70% of Subscribe & Save customers are willing to spend more than $100 on a single product on Amazon
61% purchase products on Amazon at least every week
The top categories in which Subscribe & Save shoppers have purchased products in include:
Grocery (55% have shopped recently)
Beauty & Personal Care (42%)
Pet Supplies (35%)
Home & Kitchen (28%)
2. Encourage customer loyalty:
Subscribe & Save allows you, as a seller, to gain repeat customers at a minimal investment. This alone encourages customer loyalty because the customer is ordering from you consistently.
According to seller testimonials on Amazon’s Subscribe & Save ‘About’ page, one seller saw a massive increase in repeat customers — from 10% to 30%. Think about what that can do for your business!
3. Build brand awareness:
As stated above, customers will learn to love and recognize your brand.
If you have a new private label brand, not many people are going to know who you are. By allowing customers to subscribe to your products, you gain their trust and devotion to your brand over time.
Additional benefits of enrolling your products in Subscribe & Save:
It saves your customers time and money. Your customers can enjoy the convenience of a recurring delivery while benefiting from a small discount in each order. They no longer need to sign-in and reorder every time they’re low.
Amazon provides an additional 5% discount. If a customer receives five or more subscriptions in the same delivery, Amazon will award them an additional 5% discount (for a limited time; more details below), at no cost to you.
Eligible products are automatically enrolled. If the products you offer are eligible, Amazon will automatically enroll them into the Subscribe & Save program at the 0% base discount. If left at 0%, then it is at no cost to you as a seller. Customers can subscribe just for the convenience of a recurring delivery. You are able to opt-out of the auto-enrollment whenever you choose.
Subscribers are able to set deliveries at monthly intervals. Customers are able to choose the frequency — from one to six months — for which they would like to receive their orders. This helps create loyal customers with a minimal investment while increasing customer retention for your brand, ensuring your customers don’t forget who they ordered from months down the line.
Cons of Amazon Subscribe & Save for Sellers
Despite its many benefits, there are a few potential drawbacks to consider as well. Let’s explore the cons of Amazon Subscribe & Save:
Lower profit margins. Offering a discount on your products can lower your profit margins, so it’s important to carefully consider the discount you offer and calculate whether it still allows you to make a profit.
Potential inventory issues. If your product becomes unexpectedly popular and you haven’t prepared enough inventory, you may not be able to fulfill all of the subscription orders, which could lead to negative customer feedback. Check out our Inventory Management Guide to learn more!
Limited product selection. Not all products are eligible for Amazon Subscribe & Save, so you may not be able to enroll all of your products in the program.
Calculate Amazon FBA seller fees, revenue & profit with Jungle Scout’s free FBA profit calculator.
Subscribe & Save FBA Eligibility Requirements
To take advantage of the Subscribe & Save tool, you must meet certain criteria before enrolling.
Fulfillment history with an 85% in-stock rate
A professional seller account in good standing
Your brand must be enrolled in Amazon Brand Registry
Inventory must be in an FBA warehouse (ie. you cannot enroll in Subscribe & Save with FBM inventory)
Seller feedback rating of 4.7 or higher
FBA seller for at least 3 months
READ MORE | Amazon FBA vs FBM Comparison Guide
How to check if your products are eligible for Subscribe & Save
Amazon will automatically enroll eligible products at the 0% base discount rate (at no cost to you). You are able to remove your products from auto-enrollment if you choose not to participate.
To manage your subscribe & save products, visit your Manage Subscription Products page to see which products are enrolled, set your discount-funding and automatic-enrollment preferences, see every subscription for each of your enrolled items, and send and replenish inventory.
To enroll new products that haven’t been enrolled automatically, email [email protected].
What products can you sell on Amazon Subscribe & Save?
Only products in certain categories can be sold using Subscribe & Save. Below is a list of the eligible departments:
Health & Baby Care
Automotive Parts & Tools
Tools & Home Improvement
Lawn & Garden
Note: If your products are listed in a category not listed here, they are not eligible for Subscribe & Save.
Subscribe & Save Coupons
To incentivize more customers to subscribe, sellers can offer an additional coupon when customers sign up for their first Subscribe & Save order on your product.
In the screenshot above, the only way a customer can check the 15% coupon is if they order using Subscribe & Save.
How to set up a Subscribe & Save Coupon
To set up a coupon specifically for Subscribe & Save orders, go to the Coupons section in Seller Central.
Click on “Subscribe & Save Coupons”, then “Create Subscribe & Save coupon.”
Choose the products you want to add a coupon for and continue.
Then create and submit your coupon.
Only products that have an active Subscribe & Save offer will be eligible to create one of these coupons, so you need to set that up first if you haven’t already.
What discounts can sellers set with Subscribe & Save?
Amazon allows you as a seller to choose three base discounts:
For a limited time, Amazon will fund an additional 5% discount for tiered shipments regardless of which base discount that you choose.
This means that if a customer has five or more subscriptions delivered on the same delivery date, Amazon will provide the customer with an additional 5% discount, at no cost to the seller.
These discounts and tiered-discount rates apply to all categories if you enrolled in Subscribe & Save after November 5, 2019.
If your products were enrolled before November 5, 2019, the following product category fee structure applies:
Seller-funded discount1-4 subscriptions in one delivery(to the same address)
Seller-funded discount 5+ subscriptions in one delivery(to the same address)
Health & Baby Care
Automotive Parts & Tools
Home Tools & Home Improvement
Lawn & Garden
How the fees work for you as a seller
You, as the seller, are responsible for the discount that is provided to the customer. Meaning, if you provide a 5% discount for someone who subscribes, you are responsible for ‘funding’ that 5%.
For products with lower margins (<10%-15%), it may not be a good idea to enroll in the Subscribe & Save program.
Tip from Amazon!
Obviously Amazon wants to provide its customers with the best prices around, but there’s another reason they suggest you fund your subscription at 10%.
Based on an internal Amazon study, comparing ASIN enrollment at the 10%/15% discount vs. a 0%/5% discount, they found a conversion rate increase of up to 1.8X for 10% discounts.
Think about how much more revenue your business can drive even with a small conversion rate increase.
Is Subscribe & Save right for your Amazon business?
If you have a consumable, single-use product that customers frequently use and reorder, then Subscribe & Save is a fantastic way to not only save your customers money but to generate consistent and reliable sales.
Just like any other Amazon selling strategy, though, it is important to run experiments to measure the impact it has on your business — whether it’s positive or negative.
Amazon provides you with two different reports you can use to measure the performance and to forecast your Subscribe & Save sales.
1. Subscribe & Save Performance Report
Amazon’s Subscribe & Save (SnS) performance report provides a trailing four-week view of items shipped, percentage of orders missed due to being out of stock, average post-discount sale price, and average discount for each SKU.
Use this report to better plan and maintain your inventory levels as well as maintaining consistent pricing. Maintain compliance within the terms and conditions of the program.
To find this report, hover over ‘Reports’ in Seller Central and click on ‘Fulfillment.’
On the left hand side, under ‘Sales,’ you will see ‘Subscribe & Save Performance.’ From this page, you can download an excel sheet that will show you the last four weeks of data containing pricing, out-of-stock percentage, units shipped, and discount percentage.
2. Subscribe & Save Forecasting Report
Amazon’s Subscribe & Save forecasting report provides an eight-week forecast of sales based on existing subscriptions and sales history.
It allows you to better plan your inventory as it will show you all the scheduled deliveries within the next eight weeks.
To find this report, hover over ‘Reports’ in Seller Central and click on ‘Fulfillment’.
On the left hand side, under ‘Inventory,’ you will see ‘Subscribe & Save Forecasting’. From this page, you can download an excel sheet that will show you an eight-week overview of inventory forecasting for the FBA Subscribe & Save program.
Clearly Subscribe & Save is a great way to gain consistent sales while growing your brand awareness and loyalty. To me, if you’re eligible, it is a no-brainer! Test out different pricing discounts and measure your results.
Let us know below in the comment section if Subscribe & Save has been beneficial to your Amazon business!