To subscribe for fortnightly actionable tips, new podcast episodes & the 101 Customer Journey Optimisations ebook
In episode 51 of the Customers Who Click podcast, I had a fantastic chat about DTC subscriptions with Racheal Vaughan Jones.
I love subscriptions and so do the customers - DTC subscription commerce has seen a steady 17% year over year growth in the past 5 years and according to a report by the Subscription Trade Association (SUBTA), 75% of DTC brands will offer some kind of subscription services by 2023.
It may not seem as though your brand could benefit from it but trust me - there’s always something of value that could be turned into a subscription. Any type of consumable product will need replenishing at one point. Protein powders & supplements. Skincare. Hair products. And so on.
The key, however, is to provide value to the customer - don’t just stick subscribe & save on your products because the regular subscriptions make it easier for you, do it because it makes better sense to your customers. If you can show the customer the value of your product, you’re more likely to get a subscription. And then if you continue to show value to your customers, you’ll retain those subscribers.
Rachael is a marketing partner for drinks SMEs and the founder of Jackson Jones Whisky. She has over 10 years of brand-building experience, a proven track record on world-renowned brands and has achieved success in both global and local roles in Blue Chip FMCG, as well as in the world of startups. You can connect with her on LinkedIn or head over to www.rachealvaughanjones.com.
03:53 - 10:46 - Rachael Introduces Us to DTC Subscriptions - Subscriptions are great for both, the customer and the business side of things. From your brand’s perspective, you’re securing a steady source of revenue, increasing LTV and encouraging retention. Customers love them because they’re convenient - it’s just one thing less to worry about when you have replenishable products shipped to you automatically.
But, it’s important to put the customer in charge of their subscription and give them different frequency or timing options so that they can customize it to serve their needs. What you don’t want to do is send so many they start to pile up and cause the customer to feel guilty and churn. Amazon does it well where the customer is notified prior to the next subscription package being shipped and offers the option to cancel this particular order but not the subscription as a whole.
12:13 - 21:45 - How Brands Can Proactively Prevent Customers from Churning - If you don’t know where to look, look at what the data is telling you; it’s crucial to measure the engagement, frequency of orders or how many people cancel etc. But let’s not forget about actually speaking to your customers to figure out how they interact with the product and what you can do to make it even more valuable to them.
22:07 - 25:36 - Myths and Misconceptions about Subscription Services - There’s a couple. First, some brands seem to think that adding a subscription to their site is extremely difficult where in reality, a simple plugin does the job. Second, which is a huge opportunity wasted is brands who simply stick “Subscribe & Save” and let it run on autopilot. It’s almost become a feature everyone goes for but have no idea why or how else to use it to make the most out of it.
25:53 - 34:45 - How to Set Up a Subscription Model Without Going Down the Route of “Subscribe & Save” - Frame the subscription model almost as a private member’s club where people join because they want to be a part of the community and to take advantage of the benefits that come from being a part of that club. So rather than offering a lame 10%, think of adding value by sharing engaging content or offer some sort of rewards so that the customer couldn’t possibly bear to leave you and leave that community, even if they're no longer interested in the product. Essentially, it’s about creating a really cool brand experience instead of a subscription.
35:10 - 45:06 - Tips to Get Your Subscription Services Right - Above anything else, make sure it’s effortless for the customer to manage the subscription themselves - anything from the frequency, flavour choice, changing their address and so on. Don’t just install the plugin and leave the customer to it. Also, subscriptions are boring - shift your mindset around it and create a community, a club - a really cool brand experience so that people join in to be a part of it rather than just to get products delivered without lifting a finger.
45:34 - 50:04 - Upcoming Trends with Subscription Services - Brands will have to really ramp up the value they're offering with subscription models because people have signed up for many subscriptions during lockdowns but as soon as the pandemic is over, we can expect churn rates to skyrocket.
50:09 - 54:03 - Rachael’s Marketing Pet Peeves - Lack of delivery notifications from brands. We actually spoke about the same thing on episode #37 with Chris Jordan where brands think their responsibility ends as soon the package leaves their warehouse - it does not. You’re outsourcing the logistics but if something goes wrong, your customer experience is damaged, not the delivery’s company.
57:26 - 40:54 - Rachael’s Underrated Aspect of Marketing - Email marketing in the food & beverage industry. Where in the DTC we talk about the misuse of email, brands sending irrelevant content or just selling, selling, selling, Rachael finds drink startups don’t see email as a great way to connect with their customers.