Dose #157: What Most Brands Miss About Retention

Matt here with your weekly Subscription Prescription 💊

This week, I’m sharing what separates brands that grow profitably from those that just burn through customers. We’re talking about what actually makes a retention program work (hint: it starts with product), the importance of margins, finding small wins, and freeing up your retention strategist to think about strategy.

This week’s dose is also an incredible podcast interview with Joe Siegel, who has run retention for some of the biggest brands in the space, like Feastables. Tune in or watch on your favorite platform:

Good Retention Starts With One Thing: A Great Product

Let’s start with the hard truth: no retention tactic in the world can fix a bad product.

Too many brands over-index on acquisition with slick marketing and strong offers, then fall flat when customers actually try the thing. That disconnect? It kills retention. If your product doesn’t meet or exceed the expectations you’ve set in your marketing, the customer’s not sticking around—and no amount of emails or win-back flows will change that.

Here’s one of the simplest filters I recommend: check your average star rating, unmoderated, in tools like Okendo or Junip. If it’s under 4.5 stars, something’s off. You might be overpromising in your ads, under-delivering in your product, or missing on quality. Fix that first—then layer in tactics to increase retention.

Margins Matter More Than You Think

A lot of brands assume retention is the path to profitability—but that only works if you’ve got the margin to make it work.

Strong unit economics are the bedrock of any good payback model. If you’re spending too much on acquisition, and your COGS are high because of bloated packaging, over-the-top gifts, or inefficient fulfillment, then retention won’t save you. You’re fighting gravity. What you need instead is a margin structure that lets every additional order stack real profit—not just theoretical LTV.

One tactic I love is building a monthly payback model in a simple spreadsheet. Start with CAC, COGS, and your gross margin on the first order. Then, project retention each month, factor in the margin on future orders, and track when you hit breakeven. This model doesn’t just tell you when you’re profitable—it shows you which changes (better retention, better AOV, or lower CAC) will get you there faster.

Small Wins Compound Across Every Cohort

The best retention strategies aren’t always flashy. They’re often just smart, well-timed changes that quietly lift LTV—and those gains add up fast.

One of the most effective tactics I’ve seen lately is using an unannounced free gift that complements your core product. When chosen well (especially if it addresses a known churn reason like taste or performance), that small gift can increase second-order retention significantly. I’ve seen it add $5+ to LTV in the first few months. Multiply that across cohorts, and you’re stacking thousands in profit.

And this doesn’t stop at the first order. Too many brands put all their energy into the initial subscription offer and then let retention run on autopilot. But the truth is, second-order experience, timing around lapse points, and treating your VIPs like they matter—that’s where the real revenue lives.

If Retention is a Growth Lever, Treat It Like One

Here’s something I see over and over again: a brand hires a “head of retention,” but then saddles them with campaign calendars, endless flow tweaks, and Slack messages about this week’s promo. That’s not a strategist—that’s a production coordinator.

If you want real retention growth, your strategist needs space to think. They need time to step back and analyze cohort behavior. To run unconventional tests. To look at subscription analytics, zero in on churn points, and come up with retention offers that are actually worth trying.

That doesn’t happen if they’re also doing 100% of the execution.

If you’re serious about scaling LTV, the person running your retention program needs bandwidth—not just headcount, but clear boundaries around what they should (and shouldn’t) be doing. Give them support on copy, design, campaign deployment—whatever it takes. Because the big wins come from creative thinking, not cranking out one more campaign email.

Conclusion

If you take one thing from this: retention isn’t a department, it’s a discipline. It touches product, CX, offers, and ops. If your team is too deep in the weeds to step back and think about that bigger picture, you’re likely leaving money—and customers—on the table.

Until next Tuesday, that’s your Subscription Prescription. 💊

 - Matt Holman 🩺

The Subscription Doc