Design thinking for subscription businesses | Part two
n our last article we looked at design thinking and its importance for subscription businesses. Not to be confused with an approach that's led by aesthetics, design thinking approaches problem solving open-mindedly, embracing learning and possibility, informed by knowledge and data but not inhibited by preconceived ideas.
In this article, we dive deeper into the connection between design thinking and user-centricity – the hallmark of a strong, growth-focused subscription business, and a central tenet of keylight and our core values.
What are the attributes of great design?
Great design isn't just about how things look - that's very much the icing on the cake. Instead, great design, particularly when it comes to software and technology, is about a seamless user experience. It's straightforward, appealing, and simple to use. It establishes a sense of belonging and purpose, and adapts to the needs of the user as they evolve. Crucially, great design has to have the ability and flexibility to adapt as time goes on, without becoming cumbersome for the operating team or the end user.
Design thinking is all about meeting those requirements in order to give businesses a competitive advantage that affects the bottom of the sales funnel and drives business growth.
Contrary to historic belief, that focus on the customer is actually the thing that drives businesses, especially subscription businesses, forward. Where legacy systems focus on financials first when it comes to strategy and systems, design thinking breaks complex concerns down into manageable ones that can be analyzed, moving from a finance-centric engineering solution to a user-centric engineering solution. It’s not that finance isn’t part of it, it’s that finance itself also becomes focused on the customer experience.
As Jon Kolko put it in the Harvard Business Review:
“In a culture focused on customer experience, financial touch points are designed around users’ needs rather than internal operational efficiencies.”
After all, at the crossroads of customer desire, business viability and technological feasibility, design innovation takes place.
The combined benefits of design thinking and user-centricity
The ways in which design thinking and user-centricity work together to drive sustainable business growth in subscription businesses can be broadly categorized into three areas: it enables growth, it's more cost-effective than the alternatives, and it makes great user-experiences a given.
Design thinking enables growth
The nature of subscription businesses is that they are ongoing - the job is never done. There is a never-ending list of goals, from releasing new products and services to testing new pricing or campaigns, generating new partnerships and looking for ways to optimize revenue and processes. The enabler for all of this is customer experience which is defined by autonomy and self-service shored-up by excellent support.
Businesses and their systems need to accommodate unlimited expansion, which means thinking beyond the scope of anything you can imagine on day one of the system's creation. Design thinking is the only way to build an architecture that can accommodate a wide range of services and products, whilst also supporting this high level expansion with the capacity to upscale easily with the end-user in mind. It includes and simplifies the entire growth process by considering the different ways we can approach the critical idea.
A cost effective approach
In the past we have spoken about how many businesses seek to adapt legacy systems in a bid to save on development costs when launching a subscription business. The challenge with them is that the ongoing costs of trying to make those systems work for the business can mount up and become unrelenting, whilst also resulting in insufficient and unwieldy workarounds that don't serve the user or the business. Using design thinking, which by default focuses on user-centricity, can help save money because it directs attention to the specific solutions that users need to stay engaged, collaborate and complete their tasks.
Design thinking provides a simple way to hone in on exactly what the user challenges are in order to create solutions that are fit for purpose. Along the way it often uncovers different causes and solutions to challenges than those you might expect, providing critical data and insights for building appropriate solutions. Those solutions are simultaneously in line with business objectives, including generating revenue.
Optimises user interaction
With the emphasis on problem solving, design thinking enhances user experience as well as working towards business objectives by optimizing user interactions. If we want users to complete an action, then design thinking will consider how that can be achieved in three steps instead of ten by improving the quality of the overall user experience and customer satisfaction to encourage them to keep purchasing.
Subscription systems built with a design thinking approach
When making big decisions about systems design and processes it is necessary to have clear business benefits. Design thinking and user centricity both have their individual merits when it comes to driving revenue, but by working together we can supercharge those benefits.
Improving your UX saves you money
Investing in your user experience upfront might mean an initial outlay, but it can save hundreds of engineering hours and thousands of dollars in a comparatively short space of time. By using design thinking to understand the user and create systems that improve their experiences, you can decrease the cost of customer support and facilitate customer self-service. If the system is well equipped, it helps customers to navigate them conveniently, effectively and autonomously.
Focusing on UX increases your revenue
While we talk about the importance of not leading with financial systems, revenue is a driving factor in any business, especially subscription models. They hinge on long-lasting customer relationships from the initial conversion to ongoing retention, which means giving customers reasons to stay - it's an ongoing sales process. That need to retain customers demands good customer experiences.
Investing in your user experience means keeping the customer's evolving wants and needs front of mind and continually seeing them as a priority rather than letting relationships go stale. In doing so, it increases conversion rates, improves customer retention and loyalty, and drives a competitive advantage. It does this because it directly impacts the bottom of the sales funnel, influencing customers and making people want to use the product/service time and again.
Design thinking creates solutions
Design thinking takes an almost childlike approach to challenges, seeing them as an opportunity rather than a problem.
Each development stage or customer issue presents a chance to do better, create something exciting and drive the business forward in a way that wouldn’t be possible if you hadn't been alerted to the challenge in the first place. Informed by data gathering and analysis to provide structure, alongside a willingness to test and experiment which fuels creativity and open-mindedness, the approach empowers subscription businesses to move forward and create human-centered, impactful solutions.
User-centricity enables faster business growth
Fast growth is an important part of a successful subscription business - it's something of a relay race, converting customers but then keeping them while you go on to convert many more. Once again, user-centricity is central to achieving those two sides of subscription sales, by ensuring they work hand in hand with one another. By adopting a user-centric design process, customers will experience a clearer, more organized and more inspiring system which will drive a greater return on investment.
What your system needs to enable design thinking approach
While creating the right systems and processes to enable design thinking and a user-centric approach requires careful thought, technical knowledge and understanding, the principles are nuanced but clear. These are the features a system needs to enable a design thinking approach:
A robust subscription architecture
The design thinking and user-centric mindset needs to be a company-wide and system-wide approach that's integrated at every level, from the attitude of the team to a robust subscription architecture. That means it needs to be present in the key capabilities both in the frontend and backend of the system, including aggregation and data analytics, providing an agile and efficient solution that always comes back to customer experience.
An end-to-end orchestrated system
It's important to take a holistic approach to challenges and the systems that you have, as well as the customer experience, rather than a siloed approach to particular issues and areas of the business. You need an end-to-end orchestrated system that makes integrations and adaptations into the subscription business easy, always keeping the user in mind.
Predictive Analytics
Predictive analytics are something of a game changer for subscription businesses, leveraging insights for every user interaction in the prolonged customer relationship. The data enables testing, understanding and multiple iterations on solutions through a design thinking approach.
All-round automated subscription ecosystem
Automation is essential to the growth of a subscription business, allowing you to optimize spending and allocate resources in the most relevant areas. Done well, it gives customers a sense of autonomy, simplifying processes and making smarter decisions for every user.
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