Subscription Economics: When They Work and When They Kill Your Margin

Subscription-native categories

Consumables (vitamins, pet food, cleaning). High-repurchase frequency and predictable consumption make subs a no-brainer.

Forced subscription categories

Apparel, one-time durables, gifting. Forcing a subscription model destroys both CAC payback and customer experience. Don't.

Margin math

Subscription discounts compress margin. Make sure your contribution margin stays above 30% after the sub discount. Run it monthly — shipping costs sneak up.

Retention play

The best subscription brands earn retention through the product experience, not just the subscription terms. If the only reason to stay subscribed is the cancel friction, churn will come.