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Subscription Commerce: A Shift from Transactional to Relational

Our SVP of marketing and longtime client and founder of Truly Free (formerly called MyGreenFills) teamed up to discuss how subscription models open opportunities to deepen customer relationships. Get the insights they shared at a virtual direct-to-consumer summit.

Subscription commerce relational interaction

Truly Free (formerly called MyGreenFills) founder and longtime sticky.io client Stephen Ezell is using his non-toxic laundry detergent business to combat toxic environments (in and outside the home) and build positive communities. Like many subscription business leaders, Ezell takes a mission-minded approach to selling and scaling. “Transactions pay bills, but relationships build communities,” Ezell said during a recent virtual panel for FounderMade’s direct-to-consumer summit.

Ezell said Truly Free uses profits from their eco-friendly laundry and cleaning products to help trafficking survivors and people with hearing impairments in Jamaica, all while reducing waste with refillable laundry jugs and recyclable packaging.

Whether it’s saving the world or saving customers time, selling subscriptions offers new opportunities to better serve your tribe. Read the advice and tips Ezell provided for deepening customer relationships and building community through subscription commerce.

Tell Your Brand Story

Image showing consumer buying habits for subscription commerce

Customers want to feel like they are part of something bigger than themselves or your brand. In fact, a 2021 Contently report found 65% of respondents answered “Always” or “Sometimes” when asked if they preferred to buy from brands committed to social impact causes.

Ezell encouraged summit attendees to dig deep and communicate their brands’ missions through engaging storytelling. Building a brand online is critical for growing business and inspiring customer trust. Use blogs, videos, social media, SMS and email to spread the word on not only what you’re offering, but why you’re offering it.

Start With the Straight Sale

As someone who founded a subscription business, Ezell’s method for increasing membership may seem a bit unorthodox. He said Truly Free goes after the straight sale as well, that one-time purchase that doesn’t guarantee recurring revenue. “Write ‘No subscription required’ on your checkout page,” he advised.

While his business strategy takes a low-pressure path to acquiring subscription customers, he said his team works hard to show one-time buyers the value of their products and community to inspire a future subscription purchase. This approach can drive higher customer lifetime value and reduce customer churn. In fact, they saw a 52% churn reduction.  

Enable Personalization and Customization

Generic packaging and one-size-fits-all subscription options are quick ways to lose customers and diminish your community’s spark, Ezell warned. He told other direct-to-consumer brands to focus on personalizing everything from marketing copy to offers and packaging. This custom approach shows customers you care and builds a sense of community. “From the first day, we understood our customers are human. We found a way to apply that human-first attitude even with hundreds of thousands of members,” Ezell said. And recent studies emphasize the same point: consumers are becoming increasingly more expectant of their favorite brands when it comes to personalization. More than half of consumers worldwide expect offers to always be personalized, according to Salesforce.

56% of consumers expect offers to always be personalized.

Track Your Subscription Commerce Success

Subscription management tools can unlock certain long-term data that selling one-time purchases can’t, such as buying patterns, churn indicators and other metrics that can help merchants improve their customer experience and retention rates. However, data is useless if you’re not utilizing it correctly. While there are countless key performance indicators (KPIs) to keep track of, certain subscription metrics are essential measures of success.

CLTV

The customer lifetime value (CLTV) predicts the revenue earned throughout the course of each customer’s relationship with your brand. It’s a prediction of future revenue, so it’s not quite as set in stone as other measurements — however, it’s a great way to tell if a customer is worth pursuing for the long term.

Shopping cart abandonment rate

The shopping cart abandonment rate indicates the percentage of users who add items to their cart but don’t complete the purchase. This metric can tell you a lot about your user experience and specifically the buying journey. Users will oftentimes drop when faced with too much friction in the shopping process. If your cart abandonment rate is high, it’s usually an indicator of an overly-complicated buying journey. Consider allowing autofill, adding more payment options or eliminating the account creation process to keep checkout quick and simple.

Rebill rate

The rebill rate signifies the percentage of initial purchases that convert into recurring orders. Subscriptions are meant to be recurring — if your rebill rate is low, that’s likely an indicator of an issue with your product or service. To fix a low rebill rate, check patterns among buyers who choose not to rebill to discover if there’s a common reason for their actions. Are they being misled by your marketing? Make sure your marketing campaigns align with the product and user experience because customers are quick to cancel when they feel misled.

Chargeback rate

The chargeback rate is the percentage of orders that are charged back due to a customer disputing the purchase. While we know that chargebacks can be caused by a number of innocent reasons including declined cards,  incorrect address entry or forgotten purchases, the rate is much higher for subscription merchants than straight-sale sellers. Although they’re a bit higher in the subscription space, an unreasonably high chargeback rate may signify a larger issue such as shipping delays or poor product quality.

Churn rate

The churn rate is the percentage of customers who unsubscribe from your subscription service. Although churn is a perfectly normal part of running a subscription business, a high churn rate could indicate a larger problem such as false marketing or ineffective customer service. Oftentimes, merchants can analyze the data of customers who churn to identify common behavior and indicators. By keeping an eye on this data, merchants can spot the signs of an at-risk subscriber and nurture them with personalized offers to prevent their churning.

Partner With People Who Support Your Mission

Truly Free subscription laundry detergent

Ezell credited sticky.io for serving as a strong foundation for the Truly Free (formerly MyGreenFills) subscription program during the discussion with sticky.io’s VP of Marketing. He said brands need to team up with other companies that fully understand your goals and how to actualize them. He told participants to continuously reevaluate partnerships to ensure everyone is aligned. At the end of the day, you have to pick the partners that will help you do right by your customers.  

Read this case study to learn more about how sticky.io helped them reduce churn and increase revenue to power their community-focused mission.  

Become a subscription commerce pro and grow your brand. Read the "Ultimate Guide for Starting and Scaling Your Subscription Business."

The Ultimate Guide for Starting and Scaling Your Subscription Business