Best Practices - Software Subscription Bundles

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Best Practices - Software Subscription Bundles

Introduction

With companies like Humble Bundle leading the way, software bundling is a cost-effective way for consumers to obtain multiple products at a discount, as well as a strong marketing tool for app developers to distribute their product.

In this report, we will be examining case studies from 3 major software subscription bundles: Humble Monthly, Briefcase by AppSumo and the Monthly Creatable Bundle. Within the case studies, we will be outlining the best practices for these bundle services.

Criteria

For the purpose of comparison, the case studies will be broken into multiple criteria. From this, patterns begin to emerge and we can distill these patterns into best practices. The criteria are as follows:

Product Selection: What products are offered? Is there a theme?
Value: How much is the total MSRP?
Cost: The total cost to the customer
Subscription Options: What options are available for subscription (Monthly, Yearly, etc)
Promotions: Discounts or other incentives
Unique Propositions: Something that the competitors are not offering.

case studies


The Humble Monthly bundle provides a curated selection of games each month to their subscribers.

— Products: Games, or other software targeted at gamers.
— Value: MSRP $176.58 (average of last 3 months)
— Cost: $12.00 USD/mo
— Subscription Options: 1 month, 3 months, 6 months, 1 year
— Promotions: Save more with longer subscriptions (up to 1 month free), get a free additional game upon subscription
— Unique Propositions: 5% donated to charity, offers original games not available outside of the Humble Bundle.


Briefcase is a subscription bundle of 35+ tools that are geared towards entrepreneurs. Provided by AppSumo, the bundle hopes to be an all-in-one option for small teams or entrepreneurs building their business.

— Products: Apps focused on content creation, SEO, design and similar targeted at Entrepreneurs
— Value: MSRP $1,000+/month
— Cost: $49.00 USD/mo
— Subscription Options: Monthly Only
— Promotions: 7 day free trial
— Unique Propositions: Bundled apps vetted by professional developers


Creatable is a digital marketplace and curator of design related apps. They offer regular promotions, as well as the option to purchase a monthly subscription.

— Products: Mac Apps targeted at designers and creatives
— Value: MSRP $339.00
— Cost: $30.00 one-time or $15.00/mo USD
— Subscription Options: Monthly, Yearly
— Promotions: Save 10% on yearly subscription
— Unique Propositions: Bundled apps vetted by professional developers

best practices

1. Offer a targeted selection of software

All the above bundles share something in common; they understand their target market and direct their included software towards this market specifically. Example: Design apps, business apps, gaming apps.

2. Price at approximately 10% of MSRP

From our case studies, we can see that both Humble Bundle and Creatable are both pricing around 10% MSRP. Briefcase appears to be closer to 5%, however it includes a single license worth $598. If we factor out this outlier, we again come to roughly 10% pricing.

3. Offer flexible subscription options

With over 12 million customers, Humble is the case study leader by a large margin. One of their differentiating features is that they offer more flexible payment plans than their competition, and the opportunity to save a month off when signing up for a year.

4. Incentivize publishers

As a platform for multiple vendors, subscription bundles have the ability to offer additional value to their publishers. Both Humble Monthly and Creatable work with developers for marketing and social media. Notably, Humble Bundle also assists with financing their publishers' products.

5. Include a mix of popular and less popular software

The popular software will draw customers in to the bundle, while giving a revenue bump to older or less popular products. In this way it is possible to smooth the profit curve on products not performing as well.

Conclusion

There are many aspects to building a successful software subscription bundle. In short — it is important to target the products to a specific market, price at around 10% MSRP, offer flexible subscriptions, incentivize publishers and include a mix of both popular software and older/less popular products.
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