Dose #106: Master Retention with Better Replenishment

Matt here with your weekly Subscription Prescription 💊

This week we dive deeper into retention. What is one tactic that you can use to improve retention? Make it easier for subscribers to make changes. In this week’s dose we dive into the power behind flexibility, and what you can do to unlock it.

Prefer listening or watching the podcast? This week’s dose is a great interview about improving retention - grab the links at the bottom.

The Data Behind Retention

The largest and most successful subscription programs didn’t get where they are by locking people in.

If you’ve ever subscribed to Dollar Shave Club, Chewy, or other big-name subscriptions, then you’ll know that you have all the control.

Big brands have a lot more data, and we hope they have the brains to know what to do with them. But I’ve got some data to share with you too.

Higher customer lifetime value comes when customers can make changes.

Yes, we’ve all seen the churn spikes when we send out upcoming order notifications. I get it. But do you know what’s happening for people that want their subscription but need it on a different cadence?

When customers make 3 changes to the day their subscription processes or how often they get it, their LTV is 200% higher.

When customers change products 3 times, their LTV is 600% higher.

This data comes from research we did at QPilot with other 200 merchants and their data.

Personalized retention improves LTV.

So, how do you give that power back to subscribers and unlock more LTV? Let’s dive in!

Pay Attention to What’s Happening

One of the challenges with subscriptions is that you want people to buy monthly, but that’s not how most people want to use them.

Most subscription apps will show you - and if you aren’t sure where ask me - the most common frequency types for your subscribers.

For example, you could have:

• 50% on 1-month

• 25% on 2-month

• 25% on 3-month

So while the 50% on 1-month are great because they’re processing every month, half of your program processes less frequently.

Knowing this means we can simplify the purchase process a bit and speak to what people want. In the frequency drop-down menu, make only these options available. On the product page, explain that some people use it every day and need a one-month subscription, while others use it every other day and get it on a two-month subscription.

The opportunity here is to notice what is happening. For example, several brands I consult with have longer frequencies as their most popular, so defaulting to those makes more sense on how customers view the product.

Easy Cancellations

We don’t need one-click cancellations, but we do need to spend more time on our user experience. When was the last time you reviewed people's options when they clicked cancel? When was the last time you reviewed what happened with those different options?

If someone has too much product, are you giving them the option to switch their schedule? To try something else? You can use discounts here, but the goal is creating an experience where someone can make simple changes to their subscription.

If you start to see “too much product” as a common reason, this recent newsletter dose can inspire you to increase subscription adoption. You may also need to switch up how often people get their refills. We don’t want to send too much too soon.

Variety and Flexibility is the Key

One of the most profound things we can do for subscribers is to make changes easy for them and teach them how to make them.

In addition to the classic “Pause, Skip, Cancel” on the product page, you need to send an initial onboarding or welcome series to subscribers. The first one should mention all the control they have. Through the portal, you can make any change you want and get everything as you need it.

The second thing is that you can invest more in your upcoming order emails. I highly recommend investing time in writing copy that:

• Reminds them why they subscribed (Better body, better health, saving the rainforest, etc.)

• What’s coming (another shipment, extra gift, discount, etc.)

• What they can do to make changes (don’t lead with cancel!)

That last part reminds people that if the subscription isn’t right for them for some reason, you have other products or different frequencies they can subscribe to.

Reinforce control whenever you can!

Another great option that takes a little more work is quick actions. New tech like GetARPU and Zaymo makes it easy to embed quick links inside your emails. So, customers can skip or switch up their schedule right from the email!

Give Up Control for Better Retention

The goal is better LTV and profitability per subscriber. While we may not want everyone to switch from a one-month to a three-month subscription, letting people make this change means they will stay.

I’ve been a Dollar Shave Club subscriber for 6+ years because I get razors on the cadence I use them. It may not be as frequent as they’d like, but I wouldn’t still be paying them if it didn’t work for me.

Use the tips we covered here, but keep in mind the goal is to unlock flexibility and control in your replenishment efforts!

That’s it for this week! Stay tuned for dose #107 out next Tuesday. We’ll be diving deep into loyalty programs.

 - Matt Holman 🩺

The Subscription Doc

Catch this week’s dose on the podcast or YouTube: