Scaling a direct-to-consumer retail brand has a unique set of challenges and endless opportunities for triumph. Hundreds of DTC brands, marketers, influencers and technology providers connected in California to candidly talk about how to fuel growth, avoid common DTC pitfalls and build a foundation for long-term success.
Customer loyalty was a big focus during this one-day event, with sessions covering how to build brand loyalty through rewards programs, ways to use customer feedback to propel marketing and taking a “customer first” approach when creating a growth roadmap.
sticky.io continued the customer loyalty conversation during our “Strength in Subscriptions” panel moderated by Jasmine Enberg of Insider Intelligence. Our senior vice president of marketing Thomas Marks joined our clients Melissa Harrington of Fish Fixe and Vivek Kumar of UrbanStems to discuss how their subscription programs have helped these DTC brands retain customers and grow.
Jasmine kicked off the panel by explaining how subscription commerce is skyrocketing. The average retail subscriber has about four retail subscriptions, according to our latest Subscription Commerce Conversion Index. This increasing demand for subscriptions coincides with what Vivek sees at UrbanStems, a same-day flower delivery company. “Our subscription business is growing four to five times faster than our straight sales,” the chief revenue and marketing officer said.
While UrbanStems offered one-time purchases for years before incorporating a subscription business model, seafood delivery company Fish Fixe angled to get their customers hooked on subscriptions from the start. “We knew very early on we wanted to incorporate subscriptions because if we made it convenient and easy for people to buy and prepare it, they would continue to use it,” said Melissa.
The panel agreed that offering a convenient experience was essential for a successful subscription program then listed these specific subscription features consumers expect as part of a seamless shopping experience:
Ability to pause and restart subscriptions — Since flowers and seafood are perishable goods, both Melissa and Vivek explained that the ability for their customers to pause a subscription was critical. Customers go on vacation or adjust their schedules and they need a system that keeps up with these changes.
Flexible billing cycles — Thomas noted the days of just a 30, 60 or 90-day subscription are long behind us. Merchants should be able to bill customers on a specific day, seasonally or once every certain number of days, weeks or months.
Subscription gifting — With consumers looking to give flowers as presents, Vivek noted the importance of being able to give a subscription as a gift. He explained the experience must be convenient for the gift giver and the receiver. Many subscription merchants encourage gift recipients to continue subscribing after the gift cycle ends with special discounts and offers.
Understanding customers was another major theme during GROW Los Angeles and Thomas explained to panel attendees how subscription billing data can inform brands of consumer buying habits, especially after the demise of third-party cookies.
“There’s no better data than billing platform data for personalization,” Thomas said. “You know every time someone made a purchase, paused a subscription or changed the content of their subscription order.”
He went on to explain that a personalized experience and control topped the list of what customers want from brands and a subscription billing platform helps brands meet those expectations.
Many brands featured at GROW Los Angeles already tapped into the power of subscriptions, such as Athletic Greens, Tiny and Ritual. For the founders and marketers still considering starting a subscription program, the panel offered the following advice:
Start small — Only include four to five SKUs in a new subscription program. Learn which products customers can’t get enough of, then expand from there.
Pay close attention to inventory — With straight sales, merchants can temporarily hide out-of-stock products, but subscriptions require merchants to look ahead to ensure products will be available in the upcoming months or quarters.
Stand out with killer content — Both Melissa and Vivek said that brands must continue to showcase value to retain subscription customers. Whether it’s an instructional video on how to sear scallops or an interactive quiz to match customers with their ideal flower types, brands must find creative ways to deliver excitement and build brand loyalty.
Between the panel discussions, chats at our booth or conversations over lunch, GROW Los Angeles was a great place to connect with direct-to-consumer brands and other technology partners. Catch us on the East Coast for GROW New York in July.