Zach: Hi everyone thanks for joining us on
another edition of Ecommerce Espresso - the
most e-caffeinated webinar that's shorter
than your coffee break. My name is Zach Priest,
I'm a marketer here at LoyaltyLion and if
this is the first time you're joining us,
just a quick few things to note, we keep these
episodes as quick and as insightful as possible
so we don't hold a Q&A at the end but if you
have any questions you'd like to ask us or
today's guest you can just tweet it at us
@LoyaltyLionHQ with the hashtag #EcommerceEspresso
and we'll get back to you right away. Well,
my locally roasted coffee that I got from
just up the road in Tottenham is all ready
to go so let's jump in and meet today's guest
which is Rob Barr who looks after the agency
partnerships at ReCharge. Rob, can you tell
us a bit about yourself and a bit about ReCharge?
Rob: Of course, thanks Zach. Yeah, so for
myself, my role is to look after our partnerships,
so primarily that’s agencies, developers,
designers that we work with but also our technology
partners as well. So, the likes of LoyaltyLion,
I ensure they're up to date with what we're
doing and our mutual portfolio of merchants
are set up for success.
Zach: Sure, and can you tell us a little bit
more about ReCharge overall and the services
you guys offer?
Rob: Yeah, I mean the slide here kinda says
it all.
Zach: Awesome
Rob: We are a Shopify Plus tech partner for
recurring billing. So we power the top DNVB
merchants on Shopify, particularly in the
direct-to-consumer space. So anything in a
consumable box per month, any membership type
approach we’re there to power the back end
of the billing and how those subscriptions
are both processed and managed.
Zach: Awesome, cool well thanks so much for
taking the time to chat with me and us today.
Let's get started with the first question
which is, is there a better alternative to
discounting that merchants can use to encourage
people to subscribe?
Rob: Yeah, I think the issue I have with our
industry is this idea of ‘subscribe and
save’ which is an Amazon coined term, which
does mean that all merchants default to the
idea that you have to discount to get a subscriber
or consumer to subscribe. Which actually if
you look at the hierarchy of why someone decides
to subscribe, discount is actually quite a
load down there. It's kind of a third reason
that's someone would subscribe. So we see
a variety of different reasons, the primary
incentive really is around the ease of use,
so actually having the convenience of a product
delivered to you on an ongoing basis, it's
a brand that you trust, you want to make sure
you receive the product and you never run
out of it. That should be the primary incentive.
But we're also seeing a few models being brought
in like the Amazon Prime style approach whereby
you give store-wide benefits to a subscriber
is really, really popular right now. So for
example, it can be a discount on a one-time
purchase, free next day shipping on any purchase
you make not just on a subscription, exclusive
or early access to products or content. You
know, if you do have products that sell out
relatively quickly then in that case you can
prioritize your subscribers get in the door
first, give them early access before the wider
populace. Also, things like discounts can
be applied in a deferred manner, so it might
be that your subscribers get improved loyalty
rates through points through LoyaltyLion,
for example. All these could be really good
incentives. I think also right now that idea
of giving prioritized access or support to
your subscribers, we've seen that across the
board with the likes of Who Gives a Crap and
a lot of meal delivery food companies here
in the UK.
Zach: Yeah, I think that idea of priority
making sure that you get first dibs as a subscriber
on the hot new product or the product that
you always want to restock on, we see one
of our clients Velour Lashes does auto-restock
for their subscribers, so they know that they're
always going to get the first stock that comes
in, they get access to the hot new products
as well, they get treated like they’re VIP
without necessarily having to be given discounts
all the time. So yeah, I mean heaps of good
options there outside of just discounts, thank
you.
Why don't we jump into question two which
is, what are your top three tips to stop subscribers
from churning? Only three? I mean just a small
task of finding your top three.
Rob: Of course. I'd say primarily transparency
in communication. Really ensuring that consumers
know exactly when they’ll next to be charged,
what that charge is for, for how much. I don't
think any brands should hide and make it opaque
what our customer is subscribed to. I think
really ensure that that conversational commerce
aspect is being driven. We're entering a new
era now where everyone's relying upon email,
SMS, Facebook Messenger, all that communication
between brand and consumer. So really persisting
that brand relationship there and, again,
if it's anything around the lifetime cycle
of a consumer or a subscriber, ensuring that
that's very transparent with them.
As I said before, allow flexibility. It seems
counterintuitive but really make it easy for
your consumers to pause, skip or modify the
subscription. Yes, there might be a short-term
dip in revenue, but that's far outweighed
by the higher LTV you'll have from that consumer
not churning out. So with that I’d say,
really optimizing your subscriber portal.
So when someone logs in to manage their subscription
it’s really optimized for mobile, also make
sure you're flagging those retention call-to-actions
so the ability to pause, skip all of that
is really accessible for the person and ensuring
you're leveraging retention tools, for example,
ReCharge has a really strong retention engine
whereby if someone clicks and opts to cancel
a subscription you could offer them a number
of questions to find out exactly why they're
canceling and with that dynamically give them
responses that are related to that answer.
For example, if they have too many products,
enable them to skip the next delivery. If
they don't like the part they're receiving
allow them to swap very quickly. If it's too
expensive and they're in a bit of a crunch
on cash offer discount codes directly in that
call-to-action.
Zach: Yeah, I mean definitely at a time like
this when with the current situation, people
are looking at their subscriptions, their
recurring costs, all those kinds of things
and making decisions about what they should
reconsider.
I love that all three of your answers are
all nicely tied together, that the transparency
of being able to say ‘okay this is how much
things are going to cost’ and ‘this is
actually the value that we're delivering for
you’ mixes really nicely with that flexibility
of saying ‘okay but if you do need to change
something we understand, we're staying really
close to you’. We see this with our merchants
building online communities for their subscribers
so that they can stay really nice and close
to what their customers think and what they
expect from the brand, but also what they're
expecting as far as new product development
or their new needs. So the brands and the
merchants can start to change their offering
or start to give little incentives to make
sure that those customers that are starting
to fade get something that surprises or delights
them like a little bonus or a little sample
of something new or just a slight change of
their offer so that there's something to re-engage
them again to say: oh okay well maybe this
is not something that I should forget about,
this brand really does care about me, it’s
treating me as an individual and you know
I should keep going with this subscription.
The idea of pausing, especially what you said
about letting people either skip a month if
they're overstocked or pausing does make a
lot of sense. I think there is a real sense
among ecommerce managers, marketers, business
owners to be like: ah! I need that recurring
revenue every month but if there is an opportunity
to in the long term for that entire lifetime
value to continue you’re better off delaying
that and holding on to the customer.
That's great. Okay, let's move on to the last
question here which is, some forecasts predict
consumers will tighten their belts, which
is what we were just saying, and reduce subscriptions
during the COVID19 outbreak. What's the most
important thing a merchant can do to counter
this?
Rob: Yeah, I think for us it's really seeing
brands that reinforce the perceived value
of what they deliver. And that's both for
the consumable products that people need i.e.
the bathroom/kitchen products you'd expect
to do well in an environment like we're currently
in, but also non-consumables. Those kinds
of luxury, craft items that you might not
necessarily think to persist if you are in
a bit of a credit crunch. So today with us
the best thing you can do is ensure that the
consumer really understands the value that
you are bringing to them.
We are also entering a whole new revised retail
environment. I think things like convenience
and personal stock level so they can be very
paramount. People are realizing that actually
being a subscriber and having things delivered
to your door on a regular basis when you can't
go to the shops on your way back from the
office or from work for example actually it's
becoming the core of the dorm of the day-to-day.
So just reinforcing the idea that whilst you
can't go out and you can't go to the shops,
this stuff will arrive. You don't have to
think about will I have coffee today, it'll
just be there. Running out of razor blades,
diapers all of those things. Ensure that the
convenience factor is really at the forefront.
Zach: Yeah, I especially like what you said
about the non-consumables, more premium exclusive
products. We see a lot of the time in these
situations that people start to really rethink
the things that bring them joy and bring them
value and even the consumables can start to
almost move into that category of what's important,
what's exclusive? People start to rethink
what is really important to them. But this
is a great opportunity I think for brands
to, as we're moving into this new retail space,
to be direct-to-consumer and that's an opportunity
to be direct with their messaging as well
and say: okay we’ll deliver you products
that you find value from, but can we deliver
you other values and these are the other values
or valuable exchange that we can have with
you as a customer. It's a great opportunity
to be really direct with that messaging and
to go back to what you said earlier around
transparency, to be really straightforward
with the mission that your brand and as a
merchant that you're trying to deliver on
and to align your values and brand values
with your customer values.
We see that in our research that 68% of consumers
are motivated to repeat purchase with brands
that share their values. So, this is just
an outstanding opportunity with the new direct-to-consumer
change in the market with coffee coming straight
to your door, or in my case maybe a butcher
delivery today if you hear the doorbell that's
what that is. Hopefully in a couple of minutes.
But yeah, as I said it's a great opportunity
for these brands to try to align their values
with customer values and maybe give their
customers opportunities to fight for the same
cause. On the direct-to-consumer idea, are
you seeing anything on ReCharge’s side that
is changing the subscription market in the
current situations?
Rob: Yeah, I think all of it as you can imagine.
We're seeing a huge uptick in kitchen, bathroom,
so meal replacement drinks, obviously toilet
paper had a huge spike, health supplements,
food/beverage all going through the roof if
you will. But also we're seeing a spike in
some of our merchants where again it's that
product you wouldn't necessarily assume people
would persist. People are stuck at home. Those
crafts, hobbies are more important than ever
to make sure that people’s mental health
is at its pinnacle. So, across the board,
there are big drives there. But really the
health/fitness/nutrition, that's where we're
seeing the biggest uplift.
Zach: Yeah, I mean just personally I've been
seeing and we've been seeing with our merchants
as well, a great opportunity to start to think
about their product offerings and start to
change up maybe how their products are delivered
and think about changing up some of those
subscription products or even adding products
that weren't necessarily subscription before.
As you said, things are getting delivered
to our homes now that we never thought we
would need to have delivered. So, it's a great
opportunity for brands that aren't necessarily
a subscription business to start thinking
about that and obviously ReCharge is the company
to speak to about that.
That's all we have time for today! Rob it's
been an absolute pleasure chatting with you.
So many great insights and I think some really
actionable things that our merchants and marketers
can take straight into their businesses right
now. So as always, we'll be sharing this recording
on demand so don't worry if you feel like
you miss something. Once again Rob you've
been a terrific speaker it's been an absolute
pleasure having you on. Remember if you've
got any questions for us at LoyaltyLion or
ReCharge you can just tweet at us using the
hashtag #EcommerceEspresso. So, thanks again
Rob and we'll see everybody on the next one.
Bye-bye.
Rob: Thank you, Zach.
