The Ultimate Guide to Optimizing Your Subscription Program

The Ultimate Guide to Optimizing Your Subscription Program

It’s no secret that the fastest-growing brands today are selling everything from food and wellness products to beauty and homecare with a subscription model. In fact, Gartner predicts that by 2023, 75% of direct-to-consumer brands will have a subscription offering.

Table of Contents

1. How to Increase Subscriber Enrollment
2. How to Maximize Subscriber Retention
3. How To Drive Average Order Value
4. Subscription Program Optimization Checklist

However, grabbing a piece of the subscription gold rush isn’t easy. Higher churn rates are making it tougher for merchants to cover acquisition costs and scale recurring revenue. That’s why it’s critical that you maximize the effectiveness of your subscription program.

In this guide, you’ll learn how to optimize your subscription program to increase subscriber enrollment, maximize retention, and drive average order value (AOV). You’ll find best-in-class examples from leading merchants and detailed benchmark data you can use to judge your subscription program’s effectiveness. We cover the entire subscriber journey, from growing awareness for your subscription offering to managing recurring orders.

1

How to Increase Subscriber Enrollment

There is no magic bullet to gain more customers. Instead, you must build a robust subscriber experience that grabs shoppers’ attention from the moment they land on your website and then offer them amazing value in exchange for their hard earned money. Leading subscription programs use a combination of the following strategies.

Build Brand Awareness

Building awareness is the No. 1 way to drive subscription enrollment. Customers need to be introduced to your subscription program and then continually reminded that it not only exists, but that recurring orders save them money and add convenience to their lives.

Tactic: Promote your subscription program across your entire website

The Art of Shaving Replenishment Service promotes their subscription program across their entire site.

Make the subscription program the first introduction to your product offering.

Make the subscription program the first introduction to your product offering.

Merchants that clearly state the benefits of subscribing see up to a 150% lift in conversions.

Tactic: Offer multiple enrollment locations

This tactic enables shoppers to enroll in a replenishment program at multiple points in their buying journey. It’s common for merchants to offer subscription enrollment on their Product Display Page, Shopping Cart, and through a Quick View.

USE CASE

The Honest Company entices customers to enroll in their subscription program on their Product Display Page and Shopping Cart.

Location 1 – Product Display Page

The Honest Company entices customers to enroll in their subscription program on their Product Display Page and Shopping Cart. Location. 1 – Product Display Page

Location 2 – Cart

The Honest Company entices customers to enroll in their subscription program on their Product Display Page and Shopping Cart. Location 2 – Cart

Location 3 – Quick View

IT Cosmetics utilizes a Quick View on their Product Listing Page to quickly show shoppers that they can subscribe.

USE CASE

IT Cosmetics utilizes a Quick View on their Product Listing Page to quickly show shoppers that they can subscribe.

USE CASE

IT Cosmetics utilizes a Quick View on their Product Listing Page to quickly show shoppers that they can subscribe.

Offer Valuable Incentives

Consumers can’t get enough of enrollment incentives. They reinforce their desire to “get a deal” and feel good about their purchase decision. Enrollment incentives run the gamut, but typically revolve around a financial discount.

Tactics

Provide Discounts

Discounts are the most common type of promotion.

A 5% discount increases subscription enrollment by 104%.

Include free shipping

Shipping promotions are typically combined with a discount promotion.

85% of shoppers say that not having free shipping for online orders is a “deal breaker.”

KIND Snacks offers a 10% discount and free shipping on all subscription orders.

USE CASE

KIND Snacks offers a 10% discount and free shipping on all subscription orders.

USE CASE

KIND Snacks offers a 10% discount and free shipping on all subscription orders.

CASE STUDY
KIND Snacks grew their online revenue by 50% with Ordergroove.

LEARN MORE

Tactic: Provide a subscribe more, save more benefit

A subscribe more, save more benefit drives customer loyalty and increases AOV by offering customers a better promotion for having more subscriptions.

bareMinerals offers a deeper discount and more loyalty points per order based on a subscriber’s active subscriptions.

USE CASE

bareMinerals offers a deeper discount and more loyalty points per order based on a subscriber’s active subscriptions.

USE CASE

bareMinerals offers a deeper discount and more loyalty points per order based on a subscriber’s active subscriptions.

Tactic: Deliver a best price guaranteed promise

Build customer loyalty by reassuring shoppers that you’re on their side. This capability analyzes pricing in a given time window and gives the customer the best price offered during that lookback period.

Increases subscription creation by up to 55%.

Make Signing Up Simple

Shoppers want simplicity. Remove friction from their experience by helping them find the right product for their needs.

Tactic: Implement a Guided Selling Experience

A guided selling experience makes shopping hassle-free. It reduces the amount of time a potential customer spends researching your product and ensures their expectations are met.

Yankee Candle uses a short quiz to discover which fragrances a shopper prefers.

USE CASE

Yankee Candle uses a short quiz to discover which fragrances a shopper prefers and recommends products that align with their preferences.

USE CASE

Yankee Candle uses a short quiz to discover which fragrances a shopper prefers and recommends products that align with their preferences.

CASE STUDY
Yankee Candle grew their recurring revenue by 343% with Ordergroove

LEARN MORE

Lead with Subscriptions Over Transactions

When consumers go to purchase your product, they’re excited about the item they’re buying and more likely to sign up for a subscription. Capitalize off their excitement by making it fast and simple to say yes to recurring orders.

Tactic: Default to subscriptions instead of a one-time purchase

Remember, you’re not trying to trick customers into subscribing. You’re trying to convince them that a subscription is more valuable than a one-time purchase.

illy Caffè utilizes this strategy to promote their coffee subscription program.

USE CASE

illy Caffè utilizes this strategy to promote their coffee subscription program.

USE CASE

illy Caffè utilizes this strategy to promote their coffee subscription program.

Increases conversion rates by as much as 195%.

Tactic: Indicate the most popular subscription option

Showing your customers popular options makes the buying experience easier for new customers and builds more credibility and trust in their purchase decision.

Kiehl's Product Landing Page

Improves conversion rates by as much as 22%.

2

How to Maximize Subscriber Retention

Every day, more and more merchants are introducing new subscription offerings in the market. As a result, competition has never been higher. To offset sky-high customer acquisition costs, innovative subscription merchants are doubling down on their retention efforts. Chief among their strategies is to keep customers happy with hassle-free subscription management portal and eye-popping incentives.

Include a Superior Subscription Management Portal

Shoppers want flexibility and control over their subscription experience. Offering a superior subscription management portal enables them to control every aspect of their recurring order, which builds brand loyalty and translates into higher lifetime value.

Shoppers want flexibility and control over their subscription experience.

Tactic: Give subscribers more control

Skip order:
The most common reason subscribers leave a subscription is overstock. A skip order feature encourages shoppers to take a small break, instead of canceling.

Product swap:
A product swap tool enables your customers to trade out a product for a similar item. This works great for products with multiple varieties, such as protein powder and flavored coffee.

SMS management:
Consumers are increasingly turning to SMS over other forms of communication like email. While offering SMS communication is a great start, it’s important to give consumers control over how and when they receive messages.

Subscribers last 135% longer when they have the ability to skip an order.

Subscribers last 71% longer when they have the ability to swap a product.

Did you know? 33% of shoppers cancel subscriptions because they fear that they’ll be charged by surprise.

Make It Worthwhile to Stay Subscribed

Reward your most loyal customers with gifts and perks that delight them.

Tactic: Offer retention rewards

Retention rewards are a way to reward subscribers for remaining in the program and receiving recurring orders. Typically, shoppers receive an incentive after a predetermined number of orders. The incentive could be a free order, a gift with purchase, or an increased discount.

Retention rewards are a way to reward subscribers for remaining in the program and receiving recurring orders.

USE CASE

The Honest Kitchen offers every 3rd order free.

USE CASE

The Honest Kitchen offers every 3rd order free.

Increases subscriber retention by as much as 10%.

Tactic: Integrate with a loyalty program

There are huge opportunities to grow your subscription program with qualified customers by marketing subscriptions to your loyalty program customers.

Optimize your loyalty program for subscribers.

bareMinerals offers additional loyalty points based on the number of active subscriptions.

USE CASE

bareMinerals offers additional loyalty points based on the number of active subscriptions.

USE CASE

bareMinerals offers additional loyalty points based on the number of active subscriptions.

Highlight the benefits of subscriptions and loyalty.

Vitamin Shoppe shows loyalty awards for subscription orders on PDPs.

USE CASE

Vitamin Shoppe shows loyalty awards for subscription orders on PDPs.

USE CASE

Vitamin Shoppe shows loyalty awards for subscription orders on PDPs.

Incorporate Cutting-Edge Technology

Subscription technology is becoming more advanced every day. Partner with a subscription platform that is incorporating innovative solutions like machine learning.

Tactic: Utilize Artificial Intelligence

Artificial intelligence (AI) can help you deliver more personalized and convenient shopping experiences to your subscribers. For example, you can use AI to refine replenishment frequencies and fine-tune promotions.

USE CASE

Ordergroove uses AI to anticipate when a subscriber is at risk of churn due to overstock and sends them an email offering them the option to skip their next order. This can reduce churn by as much as 17%.

broadway coffee ordergroove ai

Combat Involuntary Churn

Involuntary churn occurs when a customer’s payment attempt fails. Use credit card tools to make the subscriber experience seamless.

Tactics

Utilize dunning management tools

A credit card refresh tool automatically updates the expiration date on a subscriber’s expired credit card.

Can recover 28% of expired credit cards.

Use a credit card retry tool

A credit card retry tool automatically attempts to process orders that have been previously rejected.

Can recover 11% of rejected orders.

3

How to Drive Average Order Value

Another consequence of rising competition among subscription merchants is an increased focus on AOV. Merchants are offsetting acquisition costs by enticing shoppers to enroll in multiple subscriptions or purchase one-off products.

Make It Simple for Subscribers to Say Yes

AOV is one of the most important metrics in eCommerce. You can increase your AOV by enticing shoppers to enroll in more subscriptions and by encouraging them to make one-time purchases.

Tactic: Include a free shipping threshold

Free shipping is one of the most popular incentives in eCommerce. Use this to your advantage by instituting a free shipping threshold. In other words, encourage shoppers to spend more by offering free shipping at or above a specific dollar amount.

The Honest Company utilizes a $20 free shipping threshold.

USE CASE

The Honest Company utilizes a $20 free shipping threshold.

USE CASE

The Honest Company utilizes a $20 free shipping threshold.

A free shipping threshold can increase AOV by as much as 27%.

Tactic: Include upsell capabilities

This capability drives AOV by allowing shoppers to add additional items to their subscription order. Ordergroove customers typically enable shoppers to purchase the additional item with the same promotion associated with their subscription.

Intelligentsia uses this capability to drive more revenue.

USE CASE

Intelligentsia uses this capability to drive more revenue.

USE CASE

Intelligentsia uses this capability to drive more revenue.

Adding upsell capabilities can increase AOV by 36%

4

Conclusion

Subscriptions have seen a meteoric rise in the last several years. As a result, there’s more competition in the marketplace and increased customer acquisition costs. To scale your recurring revenue program, it’s imperative you optimize every facet of the experience, from driving brand awareness to giving shoppers complete control of their orders.

Subscription Program Optimization Checklist

Determine if your subscription program is optimized for success.

Check all that apply to your subscription program.

Ready to get more from your subscription program?

CONTACT US TODAY