.st0{fill:#FFFFFF;}

Evan Padgett Stealth Venture Labs

109. Launching Successful Subscription Programs

 May 3, 2022

By  Will

To subscribe for fortnightly actionable tips, new podcast episodes & the 101 Customer Journey Optimisations ebook

In episode 109 of the Customers Who Click podcast I spoke with Evan Padgett, the Chief Operating Officer at Stealth Venture Labs about how brands can launch their own subscription services.

The shift to online has lead to a really friendly atmosphere for subscriptions.

Subscriptions can be really powerful for a business, a great source of recurring revenue, but its also easy to get it wrong and have it cost you a lot of money. Evan joined me to explain how brands can get it right.

Evan is the Chief Operating Officer at Stealth Venture Labs, a performance marketing agency in the US. You can connect with him on LinkedIn or head over to https://www.stealthventurelabs.com/

Key highlights:

01:20 - 02:45 - Biggest Opportunities for D2C Growth - Media diversification is key. Not only are performance media channels getting harder to use and more expensive, but you just never know whats going to happen. What if your Facebook ad account gets closed for some reason? Evan’s company is spending a huge amount more on Tiktok now than 12 months ago as they’re seeing the opportunity there. We’re in a big shift at the moment, so its crucial to find new ways to market and find new customers.

02:55 - 18:09 - The Benefits of Subscription Services - Covid has obviously had a huge impact on ecommerce, the general consensus is that we moved forwards 10 years over the pandemic, and this has a knock on effect for subscriptions as well. As more and more people become comfortable buying online, and enjoy the convenience of that, more and more people are going to see the benefits of subscribing to products that they know they’ll want on repeat. Virtually any business can have a subscription element now, you’ve just got to get it right when you introduce it.

You’ve got to have a disposable, or reusable part of your business, identify what that is and look to turn it into a subscription. It could be a new bag of coffee each week, or it could be a monthly support package for the electrical products you sell.

There are some huge businesses out there now which actually make significant profit from their subscriptions. Look at Costco for example, the majority of their profit per customer is actually down to the subscriptions, not the products they sell.

It’s really important that you don’t remove what customers would consider essential features from your products, and try to add them in as subscription extras. That’s something that will just annoy customers.

18:19 - 24:39 The Big Do’s and Don’ts of Subscription - Financial planning and analysis is key. Its essential to understand how your business will operate logistically if you introduce a subscription. How this impacts customer service, marketing teams, website development etc. Because it can be tempting to rush into things and say ‘oh we’ll just add a subscription here’, ramp up the spend to support it and before you know if you’re struggling to fulfil orders, customer service is overwhelmed, and the negative reviews start piling in.

26:05 - 44:31 - Building Subscriptions for Retention - Listen to your customers, particularly why they’re cancelling. Some have too much product still, some find it too expensive, you’ve got to really listen and work out what people mean though. If someone has too much then give them the ability to skip or pause their subscription. If someone says its too expensive is that really the issue, or is the issue they’re not appreciating the true value of the subscription?

Customers have to understand that you’re there to help. If they have problems you’ll fix it, and if they understand that and believe it, they’ll happily stick around. I know that Naked Wines will always replace a bad bottle of wine no questions asked, so I’m happy to keep sending my money their way.

Be prepared to let customers go as well. Make sure you’re monitoring costs of customers and letting people go when they’re costing more than they’re worth. This is normally the case where someone complains a lot, asks for a lot of changes or refunds, and is generally difficult.

44:49 - Who Would Evan Like to Take For Lunch in the D2C Marketing World?

Neil Patel from Kissmetrics, he's super data-focused and what they did was pretty revolutionary when Kissmetrics and CrazyEgg launched.

47:06 - Evan’s Must-Have Ecommerce Tools:

  • Google Analytics

  • SMS tools

  • Hotjar

If you’d like to hear more from Evan, you can connect with him on LinkedIn or head over to https://www.stealthventurelabs.com/

Will


Will is a Customer Journey Marketing consultant, specialising in CRO, CRM and Customer Experience. Will has over 7 years experience working across a range of consumer facing businesses and has worked for huge brands such as MyVoucherCodes, Europcar, JackpotJoy, Virgin Games and Virgin Bet.

W.Laurenson

Leave a Reply

Your email address will not be published. Required fields are marked

{"email":"Email address invalid","url":"Website address invalid","required":"Required field missing"}

Keep up to date with the latest episodes and news