How the Best Subscription Brands Retain Customers

Subscription boxes have evolved to provide almost anything and everything that someone might need, on a regular schedule and curated to your liking. Whatever it is you need to function, to eat, to wear, to feel human— there’s a good chance that you can now get that exact thing right now…. and get it every month delivered to your front door like clockwork. 

Do you need razors but always forget to pick them up at the store until it’s too late? There’s a subscription service for that. Do you live in a big city that makes it difficult for you to find affordable produce? There’s a subscription service for that. Are you a makeup junkie looking for the perfect products to help you nail that hot new summer trend? Are you constantly shifting through your closet but never can find the perfect outfit to wear? Are you a total foodie looking for your next recipe inspo? There’s a subscription service for that, and that, and that.

Of course, the subscription service industry didn’t just appear one morning along with the day’s mail. A decade ago when subscription boxes were simply a buzzword on every holiday gift giving list, the industry was already valued at a whopping $57 million. Just five years after that, in 2016 the industry had nearly quadrupled to be worth a staggering $2.6 billion. But hold on, I’m not done yet. In 2019 the subscription service industry officially passed the $10 billion milestone, an impressive feat that cemented the industry as a necessary component of the overall eCommerce world.

So, what’s to account for the sudden boom for the subscription box and service industry? Many strategists assign this success to the fact that subscription services come with a built in retention model. Considering customer retention rates are always on the forefront of eCommerce strategists' minds (after all, it is 7x more expensive to acquire a new customer than retain one you already have) it comes as no surprise that when an opportunity to boost retention rates arrived, brands jumped at the opportunity.

And while it’s true that subscription services have proven to be great for retention— with 45% of subscribers sticking with their subscriptions for 12 months or more— they aren’t a guaranteed thing, with 70% of subscribers canceling within the first 6 months. In order to focus your subscription service to retain more customers, optimize your subscription strategy with these best practices.

Subscription eCommerce Marketing Best Practices

• At the beginning of their subscription, send new subscribers all of the information and resources they could possibly want or need to get to know your brand and products better.
• Think internationally, 90% of brands have international customers for their subscription services.
• Take some time to define the need or desire that your box fulfills, in order to turn your subscription service into a necessity for users.
• Consider sending curated boxes— the top choice for 55% of subscribers.
• Product presentation matters, especially when your subscription IS your product. One weak design or faulty packaging has the power to make or break your subscription.
• When possible, personalize your subscription boxes for each user so that your subscribers are able to develop a more meaningful relationship with your brand.
• Incorporate your branding and social media handles in your packaging so subscribers can easily find you on social media to take their relationship with your brand outside of the monthly package.
• Offer customers the option to customize their subscription whenever possible, in order to give them more control over their subscription.
• When you are first launching your subscription service, consider offering a trial period to entice new customers who may not have a preexisting relationship with your brand.
• Offer generous return policies as an alternative to unsubscribing entirely.
• As a special surprise to keep subscribers on their toes, include free gifts or promotions in each shipment.
• Continuously survey subscribers to gain insights into what they are loving about your subscription service and what you can change to take their experience with your brand to the next level.
• Stock your site with vibrant product photos and quippy descriptions in an effort to persuade potential subscribers to take the leap.
• Run a user-generated content campaign to turn your subscription service into a brand community experience.
• Consider partnering with Influencer to launch new products or boost awareness of your subscription.
• Encourage customers to gift subscriptions or individual products to spread the love.
• Be transparent about the value of your products by showing the total value compared to the subscription price you are charging to further promote the idea that your subscription service is an excellent value.
• Offer subscribers the option to skip a month if they prefer (a tool that is particularly useful for food-based subscription services).

How 4 Subscription Brands Retain Customers

Even though subscription services are known to boost customer retention, simply implementing a subscription isn’t enough to launch your brand to new retention heights. Instead, it takes an ongoing and concentrated effort to continuously optimize your subscription service in order to really see a difference in those coveted customer retention rates. Let’s take a look at some of the most successful subscription brands out there, to see just what makes them stand out from the crowd.

1. Stitch Fix

As one of the preemptive subscription services, personal styling service Stitch Fix has years of experience under their belt contributing to their customer retention efforts. Just one look at this email I received after my most recent monthly package arrived and you can already see all of the intricacies that go into their retention efforts. In this single email alone I am offered the option to:

• Buy my favorite products again
• Invite friends to subscribe alongside me
• Connect with Stitch Fix on social media
• Continue shopping
• Start my next month’s box

In addition to the offers in this post-purchase email, Stitch Fix is also known for offering the added benefit of allowing customers to preview and make any changes they want to their shipments before they are sent. 

2. Imperfect Foods

Imperfect Foods, a sustainable and affordable grocery delivery service, has quickly made a name for itself as a top produce subscription service in big cities where it can be difficult to find budget-friendly produce. One of the secrets to their success is their dedication to collecting customer feedback. I received this survey the day after my shipment landed on my doorstep, making it a user-friendly and timely form of staying in-tune with their customers.

Additional factors of the Imperfect Foods subscription that lead to their high retention rates are:

• The option to easily skip or update the schedule of shipments, in order to retain customers with busy lifestyles.
• Sending order reminders and updates via email + SMS.
• They use sustainable packaging, boxes, and recycles insulated liners.
• Each delivery comes with a recipe book or guide on how to prepare and store the received products, in order for customers to get the absolute most out of their subscription.

3. Ipsy

Source: @ipsy on Instagram

The curated makeup bag subscription service Ipsy has a dedicated following of subscribers and social media followers. And Ipsy is smart to capitalize on the fact that they have over 3 million active members of their brand community on Instagram, where they regularly share memes, product use posts, and most relevantly— copious Influencer posts. For example, this post in partnership with macro Influencer Candy Lover is a great way to showcase all of the products their subscription has to offer, while attracting new followers.

In addition to partnering with relevant industry Influencers, Ipsy also:

• Sends curated bags that include one item that subscribers get to choose themselves in an effort to actively engage subscribers.
• Creates and shares social media content for each month’s Glam Bag, providing a natural opportunity for subscribers to share posts on social media when their own bags arrive.
• Offer the option to “Surprise me!” for indecisive shoppers. After all, they are the makeup experts.

4. Grove Collaborative

Natural household cleaning supply subscription service, Grove Collaborative, is one of the relatively newer subscription services that have been quick to make a name for themselves. By offering affordable natural cleaning and household products in sustainable packaging, Grove Collaborative walks the walk by including helpful instructional guides in their first box to ensure all subscribers are as informed as they need to be.

In addition to supplying subscribers with informational and educational resources, Grove Collaborative also:

• Sends subscription reminders and updates via email + SMS.
• Offers a continuously updated spread of natural and organic products for their subscribers to choose from.
• Uses reusable, sustainable, and recycled packaging with all of their deliveries. 

While subscription services are known to boost customer retention, they are unfortunately not a cure-all. For more insights into how to perfect your customer retention efforts, check out our eCommerce Marketing & Retention blog for more insights, tips, and tricks!