In this 18th episode of The E-comm Show, our host and BlueTuskr CEO Andrew Maff is with Jay Myers of Bold Commerce. In this episode, you will know all of the advantages and the structure of having a Subscription Model for your E-commerce Business. Listen and Learn more about how to take advantage of the model and how to make your business grow.
If you enjoyed the show, please be sure to rate, review, and of course, SUBSCRIBE!
Have an e-commerce marketing question you'd like Andrew to cover in an upcoming episode? Email: hello@theecommshow.com
Bringing Value to an E-commerce Subscription Model
SPEAKERS
Andrew Maff and Jay Myers
CONNECT WITH OUR HOST: AndrewMaff.com | Twitter: @AndrewMaff | LinkedIn: @AndrewMaff
About Jay Myers
Jay Myers has been an e-commerce store owner since 1998. In 2012 Jay co-founded Bold Commerce, which now powers over 100,000 brands, helping them run their subscription, membership, VIP programs, and a world-class checkout experience.
Bold has grown from a basement to over 450 employees, inspired by an unwavering commitment to customer care and energized by a culture of continuous innovation.
Bold has been ranked one of Canada's Top Medium-Sized Employers, ranked in the top 50 fastest growing companies in Canada by Deloitte multiple years, a 2019 Top Growing Company in Canada by the Globe and Mail, and an Ernst and Young Entrepreneur of the Year winner.
Transcript:
00:03
By all means, like anytime you release a new product let your members have access to it first. This is Joe Shelerud from Ad Advance. Hi, this is Lindsay Hagerman of raincaper.com. Hey, it's Jay Myers. I'm with Bold Commerce and you're listening to and you're listening to then you're listening to The E-Comm Show.
00:26
Welcome to the E-Comm Show, presented by BlueTuskr. The number one place to hear the inside scoop from other e-commerce experts share their secrets on how they scaled their business and are now living the dream. Now, here's your host, Andrew. Hello,
00:46
Everyone, and welcome to another episode of The E-Comm Show. I'm your host, Andrew Maff. And today is gonna be a good one. I'm super excited for this one. I am joined by Jay Myers, one of the cofounders of bold commerce. Jay, how are you doing? Right for a good show.
01:02
I'm doing awesome. And thank you so much for having me. Yeah,
01:06
I'm super excited for this one. So we always have e-commerce sellers on the show, which I know you were an E-commerce seller, you still a seller yourself, or I assume you've probably pivoted
01:16
solely at this point. I sell vicariously through a lot of friends and family members. But yeah, so I built my first store in 1998 sold for years. And that was kind of how I mean we can get into it's kind of a fun story. But so now I actually for fun. I spend a lot of time helping my brother's got a Shopify store. I kind of feel like I'm still a store owner at heart, you know? Yeah. Never leaves. You can take the person out of the role, but you're always a store owner.
01:47
Yeah. What so I obviously will get into a bolt. But what were you selling? Back when you started in 98.
01:57
I was selling archery supplies. So big. I was a one of the actually like for like four years in a row. I was the Canadian archery national champion. I got really big into archery. And so we Yeah, I could probably shoot an apple off your head. I'm not anymore. I'm pretty rusty now, but don't trust me. Don't ever let me do it. I, I was 13 years old and my brother was 16. And we both are really big into archery. And my dad said, Hey, do you guys want to start an archery store and so my dad quit his job remortgage his house, and we built a like a pro shop. So there was a store and then 24 Indoor lanes, kinda like a bowling alley concept. Like there's a lane where you can practice shooting, and then a store where you can buy all your gear. So I grew up working in a retail store since I was 13. And then when I was 18, and 98. convinced my dad like said, Hey, like we should try selling some of the stuff online. And it actually ended up the way it started is a really funny story I did the ordering when I was 18. And my dad would always say, you know, like inventory cost money tight sitting, if it's sitting on a shelf, that's money tied up. And if anyone here listening, they know this, as well as anyone. inventory on a shelf is money tied up. And so one day, I ordered too many of this one type of bow. And I remember my dad like looking at it and saying like, you know, J All I see is $100 bills sitting up there on that wall of inventory that we can't use for something else. Are we if we're not going to sell it in 30 days because usually, you get a net 30 on your inventory. We're not going to sell in 30 days, why do we need that in stock I and I said okay, that I'm going to try selling it online. And actually, the first thing I did was I put it on eBay. And just as a test. And I ended up selling it for more than we were listing it for in the store. And so that was kind of like, like, eyes wide open and like, holy cow, okay, so that we were selling this for like $300 in the store. And I don't remember what it was, but I sold it for like 350 on eBay. And that was like back in the days when eBay was like the craze and everyone was sold on it like this was even like before Amazon was really even a thing. And then eventually so we did that for a while but then eventually turned it into our own brand and selling it so like you know when you saw an eBay, you're kind of renting customers through eBay traffic. You're not building a brand. You're getting sales and making money but not building that long-term brand. So that was how it started. And then did that until while 2010 I moved one of the stores on to Shopify, and it was a store like a number 6000 It was really early in Shopify as days like they wow there was like hardly anything. I have a screenshot still from what the App Store looked like it was app logos on wouldn't show up It was like really? Web. One wall, I guess it was web 2.0. But anyways, it was in that in that transition stage. Yeah. But it was, it was interesting, because actually, you know, as archaic as the App Store looked, it was revolutionary, because they, there was no other e-commerce platforms doing that, as I had stored on Bigcommerce. I had another like, another one on. They're still around. It's called a chop factory, or in Australia. I had stored it on a number of different platforms. And Shopify was the first one that had this concept of an app store. So like me being a merchant, I looked at this, like a kid in a candy store. I was like, I want this, I want this. I had this long list of ideas of things I wanted to build for my store. And then that was kind of how bold came around. I one day ended up telling a buddy like, Hey, I got these great ideas. And there was to put this into perspective, there were about 40 apps in the App Store at this time. Like, there wasn't 7000. Like there is now and there were no holds
06:00
40 Now, doesn't it?
06:03
We're already around 100,000. Yeah, so 100,000 apps. Oh, sorry. Sorry. Sorry. 40 apps. I thought you meant 40. You know what? We got up to 36. But we've pared down quite a bit. We've actually that's been a big thing for us in the last few years is trying to get a lot more focused. But yeah, at one point we were close to 40.
06:26
Yeah. So then, what did you originally have available? That's
06:28
hilarious. The bold App Store? Yeah.
06:34
So what's that story? Right?
06:38
Well, the story was, you know, so I, yeah, I mean, I mentioned it to one of our friends. And it was a complete experiment. And we thought, the original app that I actually wanted was for my own store, I wanted to build like a product comparison tool, you know, when you're shopping like for backpacks, or something, you can see, you can pick, pick three different backpacks and compare the size and features and see them side by side. We thought that was gonna be too hard. So we said, well, let's just build a little like upsell app, just as an experiment. And like, there was no, there was actually no front-facing apps. In the App Store. They were all integrations. So by front-facing, I mean, living on the front end of a store that customers interact with. So all the apps were, like, integrate with shipping carriers integrate with accounting software integrate with like Google Shopping, things like that. There were a few of those around. But so those would run like batch jobs. And you could have, it didn't matter how much traffic was on the front, we built the saw our upsell app, we kind of hacked Shopify APIs a little bit. This was 2012. To put it in perspective, now, you don't have to hack anything, you can do this all completely properly. But we used we made API calls on the front end of the store. So every time a customer clicked Add to Cart, it did it, it did an API call to check which products should be recommended based on which product was and there was, and then it would recommend a product. But there was no API throttling. So we had, I remember one of the first big stores that use our upsell app was the chive. And every time they would run a sale, they would take down all of Shopify. So this is around 20,000. Stores. This is not like 1.7 million now. But because they, they would run some, you know, messaging on social media or some promotion, drive a bunch of traffic, and then hundreds of 1000s of people clicking Add to Cart, triggering upsells, doing all those API calls, they would actually take down the whole platform. So early on Shopify wasn't very happy about it. But then they quickly realized that merchants love, it's great, it's a great tool. So then they built-in processes and API throttling and different ways to make apps that live on a front end of the store work. So then it took off, like in a nutshell, stores loved it. So then we kind of thought, Well, okay, well, you know, what's the next step we're going to build. And we, that was our strategy for a long time just to build as many tools that would help merchants make more money because, like, I was a merchant. So we actually kept our stores until it was about mid-2015. And every single app we built we used on the stores too. And so like we were, we were merchants, and we were app developers equally at the same time. And it also helped, like, from a product development standpoint, because we were building the products using the products. And, you know, it kind of gave us that we're app developers, but we're merchants too. But then after a while, you know, we had been in bolt had been around for like, three years and we thought well, it's time to sell the stores and just focus on building the tools for Because at that point it, it had taken off like we were all fully employed by a bolt. So,
10:05
yeah, so you mentioned obviously built, you had up to 36 apps at one point. So obviously, you guys kind of started going there, then you said you, you started paring it back. So what is what are you guys focusing on now? Yeah, like, I
10:17
think right now there are probably about maybe 14 live in the app store. There's a lot that is, like, none of them, well, like stores might still be using them. But they're not publicly listed. Like you can't install them anymore. But we're, but like that, you can go to the App Store install? Yeah, it's, it's, it's just, you know, like in business, it's kind of one of those things where it's very hard to be good at everything. And we learned that. And you also, you know, people like to bucket you like when, like, right away, like if I, if I talk to you, or if I see you on a, they'd like to put you in this, okay, Andrew, he's like the marketing guy, or he's this or he's this. But if you, you know, have you ever, you've probably been on these like agency websites that do everything. They're like, we do SEO, we do marketing, we do pay, we do? Copy, we do social media, we do email marketing. And then there's like some agencies that like, we are the best at email marketing. And that's it. And so, who do you want to use? Do you want to use the one who's the best email marketing? The one who the best paid? Or do you want to use the agency that's like, on their top menu, it's like literally every service you can think of? And that's kind of how we felt like, we felt like, oh, yeah, we're kind of doing all of this. And they were all good apps. But a customer couldn't put us in a bucket and understand really what our value is. So now, like our focus is all around, subscriptions are a big, big focus of it. And check out and price rules. So we have a price rules engine that powers a lot of our stuff. And then so that can power everything from our, like, customer pricing and upsell tools, quantity, breaks, bundles. Discount engine. So a lot of the stuff around pricing. That's kind of a big, big focus that and then and subscriptions as well. Yeah.
12:15
So when you and I first started talking, I was super excited. So it's like I've been a fan of bold for. I mean, at this point, it's gotta be like, by five or six years, I think so. Prior to BLU tusker, I was in the house somewhere. And they were originally on WooCommerce, which I'm sure you know like WordPress is a nightmare. And there are so many different plugins. And I always had this issue where you know, WordPress would update and or one plugin would update or whatever, and it would cause the whole thing to break. And so finally, switch over Shopify. And the last thing I really wanted to do was have a ton of different plugins, or in this case, different apps from different companies aren't like I didn't know I was like, if one of these updates, it breaks the whole thing. This is such pain I hate this concept came across bald, and I'm like, This is great, I can finally commit to one company that does everything I needed to do. So that I don't have to worry about anything. So when I first started, we had subscriptions, we had quantity breaks, we had upsold, I lived in bolt brain just because I thought it was fun. And so like, a lot of times like, you know, I as soon as you reached I was like, oh, it's gonna be great. And so it's funny to hear your kind of pivoted to that stuff because I didn't even like I would look in there. So you guys have so many things. I was like, I don't even know what some of this stuff does. So, yeah, we'll get away from it. But I definitely see a lot of people now catering to having like the quantity breaks and subscription type option. So why do you feel that a lot of people are pivoting that way? Because obviously, you're taking the business in that direction. So what do you think is causing that?
13:52
There's so the reason why we care so much about subscriptions. We launched both subscriptions in January 2015. So it's so that was ours just for a quick little bit of context. We have two versions, one the version that was for around for five and a half years. And it's still as we just call it v1. And then recently there's a new version, we just call it v2. It's not better, it's just different. And it's the one that works with Shopify checkout. But taking a step back the subscriptions are man, they've evolved so much. So like we see brands getting sold, or acquired for sometimes like seven to 10x their annual recurring revenue, like what we're seeing, like what you'd value a software SaaS company. We're seeing e-commerce product companies be valued for so you know when you're building a business if you build a subscription business versus a one time order business, you're just building such a more valuable business So the impact that it can have on people's lives is seven to 10x. more impactful literally, actually, maybe even more, you know, if you have a one-time product, the value of your company is, is a multiple of EBITDA. So like, it's like maybe one and a half times EBIT on maybe like, that's an average. But when it's recurring revenue, it's valued completely differently. So there's that there's what we've seen it do to people's lives, but I also just really, really believe in the model because I'm a subscriber to so many things. And like from food to clothing, to vitamins, to juices to salads, I have for lunch, like I, it's, the reason why I like being a subscriber is when brands do it, well, it's a win-win for the brand. And the customer because I, if I'm, if I buy, let's just say a smoothie from a company one time, I'm the, what I'm worth to them is very, very little, they'll spend very little to acquire me, they'll spend very little to service my customer support, they'll spend very little to, like, they just really don't care that much about me. Versus if I may subscribe to member, the lifetime value that I am to them, is about 700 times more than I'm, if I'm a 100 if then if I'm a one-time customer, so they can spend more to acquire me, they can spend more to service me they know me better because they have data on me, they should be able to give me better like product recommendations and better a better experience overall. So it's a better experience as a customer. And then it's, it's a better experience as a brand as well too because it has predictable revenue, more valuable customers. It helps with inventory control, like knowing what you're going to sell that needs the next month like it's, it's one of those mechanisms, that it's a win-win for brands, and for customers when done properly. Now, don't get me wrong, there are a lot of subscription brands that are not doing it properly. They, they put on what I call like a Subscribe and Save bandaid, they have a store, they sell a product, they install our subscription app, or it could be any doesn't have to be us it could be any subscription app, and they slap on a Subscribe and Save. And they like to think they're going to be successful. Because really, they're just giving a subscription option. But they're not becoming a subscription org, they're not changing how they think, you know, it's even as simple as like, I always tell our brands like stop calling your customers and call the members because this is like super basic, but like you treat members differently than then a customer. Yeah, they're a member, they're worth more, they're more valuable. spend more on them. So that's another reason why we're passionate about it. Because I think it's a when done properly a better experience for brands and for customers. So,
17:55
like you said, though, so you know, subscription companies can be sold for, you know, an amazing amount of money. But at the same time getting one up and going is very difficult. Do you see a lot of them fail before they get up and running? What do you in your opinion? Did you guys work with them all the time? What is it you see, that are like the ingredients of a successful subscription company versus someone like you mentioned where they just slap up, Subscribe and Save as an option?
18:23
Here's the number one mistake, I can almost always tell if a subscription brand is gonna succeed or fail. If I ask a brand, what's the product? What is the value, it's a product that your subscriber gets when they subscribe. And if all they say is while they get our art, they get our product, they get our vitamins, they get our coffee, they get our whatever, they get it every month and they save 10%. And if that's it, I can almost always tell they're doomed. Because if all they're getting is that product, and the convenience of an auto-refill, they're going to hit the customers are going to hit subscription fatigue. And probably four to six months. And then we can get into this in a little bit. But they'll hit what I call the subscription death curve. And we see probably about 80 to 85% of subscription brands are in this. They're just completely flatlined. If I go in our data, and I look at Brands, a lot of them are just completely flat. They're churning 10% of their customers every month and they're paying Instagram and Facebook to bring in and they're just flat. They've hit that level. But if I ask so here's the key. So like, you need to think of a subscription should be a component of a great membership. And what most brands don't do is they don't think about membership and what that really means. So a subscription is a billing decision. It's a shipping option. It's a shipping choice. It's not the value of it is it'll it's almost table stakes now like if you sell coffee and you don't you know Have a Subscribe and Save option on it. So a customer might go look somewhere else because it's just expected. It's not it's no longer like what differentiates you. So when we look at subscription brands, there's really, there's kind of three models they fall under, or people typically think of them in three different models. They think of replenishment curation and access. And most of the time, people would say they're in one of those models, they would say, I'm a replenishment, subscription. So like, let's stick with the coffee example. So I, I sell coffee, my customers get a bag of coffee every month, and they save 10% It's replenishment, or if it's curation. Typically, when we think of creation, curation, it's like the Box of the Month or something that's different every month. And then if it's accessed, it's access to content on a website or access to like, you know, tutorials or some learning or there's you're paying for access to something, maybe not even necessarily a product, but it's just accessed. So usually, people think of themselves in one of those three buckets. This was a couple of years ago, we actually looked at, we've got around 20,000 brands using our subscription software, we looked at all of them, and we tried it as we looked at like the camera was probably like the top 200. We looked at try to find like, trends that they were doing and things that were driving success for them. One of the biggest things that stood out is the most successful brands they're offering have almost always had an aspect of curation, replenishment, and access to all three. So the coffee example, even though the customer subscribes for the coffee once a month, you could for the curation aspect, you could layer in each month, you know, like a different flavor that gets sent roaster choice each month or something. For access, there are 100 things you can do like access to VIP pricing on the site while they're subscribed, or when new flavors come out. Members Only get access first or, you know, access to content access to communities, the founder of the coffee company could you know, once a quarter, do a zoom call with all members and have coffee with the founder. And he talks about how the beans are roasted or whatever, there are tons of things you could do. Partner discounts are a big one, you know, if I'm subscribed, I get you to know, 10% Maybe I'm like yoga or, you know, a mindful this coffee brand. And so like while I'm subscribed, I get a discount with my mindfulness apps and at yoga studios or whatever. So now when I hit that subscription fatigue, you know, like maybe I go on vacation and a couple of the bags of coffee build up. I'm not just losing, if I go to cancel it, I'm not just canceling that my value isn't just the coffee, it's I'm losing everything else. I'm no longer getting 10% off on everything else in the store monthly, I get one day once a month at 50% off because I'm a member I get one offer once per month or whatever like I lose all of that. So I usually tell brands, so back to that original question. When I asked a brand, like what is the value that your customers get every month from being a subscriber, if they just say
23:05
they get my product at a subscriber save discount, the value needs to be at least three times what they're paying for the product. So it's like a perceived value. So if you can kind of put you know, take a whiteboard, and write all the benefits that your subscriber gets for being a member and put up what is the value, they get that discount every month they get that perk, they get that Zoom call, they get that partner benefit. So if my coffee subscription is $19 a month, then they should feel like they're getting roughly like a $60 value a month. So they're going to be very sticky. And a great example of that is Amazon Prime like no one cancels their membership. Because even if you don't order something from Amazon for two months, you're probably not going to cancel it because you might use their photo storage, you might use their prime video you might use Alexa, I think I'm plugged in for this, it's not gonna go off. But you know, there's all the other things that like that you use. And so that's, we just call it subscription value stacking. And If so, if most subscription brands when they start, they don't think about that at all. They slap on a Subscribe and Save. They try it for a few months. And then they say all subscriptions don't work for me.
24:16
I like to put it back because I really am curious about this one. What is this death curve you're referring to?
24:23
So this is it, we've noticed and it's not just with an E-commerce subscription. This is across the board with SAS companies as well as any company that has a recurring billing model. They often no matter what the number is if you're onboarding, you know, 1000 customers a month, 10 a month, it doesn't matter. If you have a churn number let's just say it's 10%. And, you know, you can acquire an even if you can acquire 1000 customers a month through Instagram and Facebook, you're gonna get to a point where you're The accuracy numbers you can bring in. So if you have, if you have 10,000 customers a month and you're churning 10%, if you're losing 1000 and acquiring 1000, you'll eventually, but plateau at a flatline at 10,000. If if you're acquiring 100,000 customers a month, you'll flatline and a million, it's going to be at some point, at some point, you can no longer be on board, and you just plateau. And most subscription companies that have a subscription model, almost all hit it. The ones that don't, are the ones that so there's like an, you know, Facebook, and a really good example that I use a lot is Club hosts that recently. So they grew like crazy. They also shrunk like crazy after but they had incredible viral growth. And you could ask anyone there what their viral coefficient was, and they would know it to the tee. The same thing with like, with Facebook, with Twitter with anything, it's a metric they track and the viral coefficient is it so you can if you have
26:03
15% churn, which is very high, most brands are like seven or 8%. But let's say it's very high, if you have 15%, churn, you need every new subscriber to refer 1.2 Friends or people to break out of that death curve. So if you have the 20%, churn you need, it's like 1.27, you can google viral coefficient, figure out what it is. And it's the number of every, every user that signs up. And this is for software for every user that signs up, how many other users they have to bring in, to have viral growth. And that, that, and then that number is just dependent on how high your churn is. So if you have zero churns, then you can have viral growth at 1.01. Like it can be hardly anything that'll, that'll still grow exponentially. It's like your stock market. Like if you can make 8% a year you double every year, you know. But if you have churn, then that makes you need to be higher. So one of like, one of them, like, a lot of times I ask brands, like, you know what, what your key metric is, and they'll, they'll say, Well, we, you know, LTV and average subscriber size, and we track customer acquisition cost and average order, volume and churn. And I almost never hear people say, I track referred by a friend as a key metric, and whatnot, how many? How many new customers each existing subscriber refers. And it really should be a key metric for brands. Because if you and the problem is, so there's two, there are brands that have customers that love their product, but they got really crummy referral programs. And then they have, you have brands that have really good well thought out referral programs, but they got the customers aren't happy with the product. And so what I mean by a crummy referral program is if you sign up for something, and then in your customer portal, there's a link that says, you know, share this link and give anyone 10% off, that's a crummy referral program. You're never gonna, you might post on Facebook, hey, if anyone wants 10% off my solid subscription I just signed up for here's a link. And it's like, you're going to be the type of customers you're going to get from that, if any, are crummy customers. If I got, let's say, five links, let's just even say three, actually, if I got three links, when I signed up, if it said, Hey, we're giving you, Andrew, three links, to share with friends that you think might also like a salad subscription, who are trying to eat healthily, they're going to get two months free of salads, like $100 value or something like that, like, but you only get three, you can't like, give us a lot, you're gonna think about who you give them to. You're gonna like you're probably going to phone them and say, like, Hey, Jay, like I got one of these solid subscription links, like, are you going to actually use it? Because I only have three. And that's what happened with clubhouse giving you five invites. And I remember, like, texting people, because I had people asking like, Hey, can I get an invite? And I'd say, Well, I only got five or you're going to use it. So what that does is that it gets very highly engaged right off the bat. It's an engaged customer, because like I'm asking here, you're going to use it, they almost feel this obligation to the user because I did them a favor. So if I like if say, like, hey, Andrew, like I only got three of these invites, are you actually going to use the salad subscription, because if not, I'll give it to someone who will. So you there's that sense of obligation, you're also probably more of the ideal customer profile, you probably fit the customer they want. So you're likely to be a happy customer. And then you're also more likely to refer people and I only need 1.2 referrals. So if I only need if you know a lot of customers will prefer none, but some will refer three. That's fine. But that's an example of a great way to run a referral program versus just the generic You know, Link. And then the other big thing is like most brands they don't they wouldn't they don't actually even know how many customers a month are coming through referred by a friend or some referral mechanism. It can be as simple as having a form. When someone makes a subscription, like how did you hear about us, like Google Instagram heard my friend, and find out what that number is. And if last month, like if there are any brands listening right now that run a subscription business, step one, like after this episode, like find out what that is, like it might be, it might be 6%. And that's okay, it could be really low. But make your goal next month to make a refer-by friend like, know it, you know it, and most brands don't even know it. And it should be like a Northstar metric. Because once you get to a certain point, your customers become your marketing channel. And every customer you get becomes more customers and you don't even you don't need Facebook and other paid acquisition, your cost, it's becoming an that's a viral coefficient. Like you don't actually need advertising, every customer multiplies.
31:07
Always do you always suggest like, if you're gonna go the subscription route, you should almost always have some kind of loyalty program tied in
31:17
with it. i Yeah, like when you have subscribers, you, they're typically they're, they're more engaged with your brand, like, a perfect example is, you'll probably never subscribe to something and then forget the name of the company a week later. And this has happened to me multiple times with one-time products I needed one time some like, I know, it was like some hand lotion for my son had like, dry hands. And I was like googling like toddler hand lotion. And I found some like hand lotion, I ordered it. A week later, it hadn't come yet. And for the life of me, I couldn't remember the name of the company that I ordered from I had to search in my email had lotion, and I was trying to find an order confirmation, I couldn't remember the name of the company, you probably will never subscribe to accompany and forget the company. Because subscription by its very nature has lower conversion, it's a higher, more effort, it's more of a commitment to subscribe than to make a one-time purchase. So you're already getting an engaged customer, who's way more likely to refer your brand than a one-time customer if you give them the right tools. And how many times have you had someone you know, like, I don't so many people have like a FabFitFun membership or something? And they tell you Oh, you got to get this you got to get on it, like subscribers feel more connected to the brand. And that goes back to the original thing you're talking about like when done right? It is better to experience brands do know you better they can give you a great experience. And so there is something to talk about. So yes, 100%, I think is even more important for subscription brands. And then one time reds.
33:02
Yeah. And your point, your point, a lot of stuff is obviously very good. My thought with the, you know, adding the extra value to the subscription. It's one of those things where like, you know, it's unfortunate, we have the same issue or we'll get we'll end up working with sellers. And they'll be like, oh, you know, this is a product that they may need to purchase more often. So let's just add a Subscribe and Save option. And we'll be like, Okay, what else do they get with it and like, we'll give them a discount, like, that's not, that's not going to entice them to do anything. And what I find like a lot of sellers don't think about is there's a lot of stuff you can offer that doesn't really cost too much. Or if it does, it's like a one-time build-out of a program. So just like you mentioned, like, if you're, you know, mindfulness and you have a discount to another yoga company, you're just developing a partnership with another company where Yeah, at that one time, you can offer a discount to your members. But at the same time, there's so much other stuff you can do with them as well, which is like, you know, if you start doing podcasts, or if you're doing like different, like newsletter exchanges, or you're doing social stuff, or you start working out like article, things that you can do back and forth like there's so much that you can leverage that outside of it. But even then, everyone always thinks like, well, I'm going to give them 10% off, what else should I be giving them like I can't go make all of this and go buy a new product and a couple of and it just won't be worth it or maybe they don't have like the whole subscription box concept lined up. But there are so many other things that you could provide value with that, you know, it's usually amazing how many of them just kind of throw up that subscription thing like do you guys have that is a pretty common issue on through bold, very common.
34:42
And you know, like, if you feel like subscription brands listing like if your customer next month, if they didn't get whatever the product is in the subscription, whatever the physical product is if they would all cancel, then you have a crummy subscription and it's probably not going to last. But if they, if you're if they didn't get a product one month, and there was still enough value around there, you've got a very healthy subscription. And I would say, like one of the easiest things you can do, as I get it, like a lot of brands are like, Well, what else can I do, like I just, you know, I sell toothpaste, and I want to have a subscription option on it or something like that bare minimum, give your subscribers, you know, have the customers be tagged, and, you know, give them a higher loyalty point, redemption or earning rate. So like members earn points fast, like Costco, like you pay to be a member, and executive members and regular members, like you, earn more points, or they can redeem at better rates, give them give them make their returns, be for six months, instead of 30 days or, you know, there are benefits like there's there is always stuff you can do. Even if you don't have, like, you know, maybe you don't have a community or maybe you don't have content that you're producing. There are other perks. And like by all means, like, like anytime you release a new product, let your members have access to it first, like email them, put it on a hidden collection. And you know, it's simple, you can be password protected, or however you want to do it. But email all your members and say, Hey, we've got this distinct product coming out, we always were giving you exclusive access to it for 30 days, zero members. Simple things like that, like that stuff, go a long way and all those things add up to perceived value. And at some point, that customer is going to think about canceling that subscription. And each one of those things, adds weights to them keeping it all but if I cancel it Oh, yeah, there was this there was that there was at yeah, there are very few brands that they there's like nothing they can do. Like I think there's always something you can do. So you know, take, like, I just say like, get a whiteboard, take a product out of it. And just write down three titles, curation, replenishment access, and start jotting down things under each of those that they can do in those buckets. What can they do for access and access, and I love partner stuff under access, but Bill as much as you can in those. And the other big thing I would say, this kind of goes to this question that I think a lot of subscription brands don't do is come from this mindset of being a one-time brand. And they're so focused on customer acquisition cost and what they want to spend for customers, your subscription customers are worth a lot more. And it's like we have a dashboard that shows what LTV of customers are, but if you don't like you can just assume they're at least double. Most times they're like have at least four times higher LTV. You can be creative with ways that you convert them. So not necessarily spending more on paid acquisition, but you could maybe give them like their first month for free. Or you could give them like a very heavily discounted, inset some way to incentivize them to get on, or when they sign up for a coffee subscription, they get a hat and a shirt. And like some really like $100 worth of merch, because they signed up for a coffee. Like it would seem crazy. But if you think about that as customer acquisition cost, and then you look at like, Okay, I'm normally I'm willing to spend $32 to acquire a customer. Well now if I times that by the minimum to maybe up to four because it's a subscriber I should be okay spending like $100 to acquire customers like the unit economics need to make sense. But depending on what your brand is what your product is, like, consider whatever perks you get to have them sign up as customer acquisition costs. I think a lot of subscription brands are afraid to do that. But it's it's a cost to acquire a customer.
39:07
It's its genius. And you know, it kind of makes you think too because there's, in a way, it's almost like there really aren't that many products out there that you couldn't have some kind of subscription and or membership option to it. Because even if like a Kaiser so say this thing, but sell mugs Right? Like you can, yeah, you can have a subscription to get a mug every month, maybe if it's a different mug and you like different mugs fine. But that's difficult. But Your other option is like you set up a membership and they just every month we send you something that could go in that mug or we send you some swag that you get or you get you to know if it's stuff that's outdoor mugs kind of thing you could have like content that you're constantly giving them access to influencer interviews and things like that, that only members get and it's like, you know, it's almost like a completely different revenue stream that you could add to your e-commerce business. Even if you think your product isn't subscription-worthy, it could be very well. Membership.
40:05
Totally, there's a brand. I think it's called, I think it's called Steel City tees or Steelers tees, it's a t-shirt company that makes clothing around Pittsburgh Steelers. And what they decided to do a couple of years ago was to go only to members. You can't actually they've got a bit of a following. And they make these awesome Pittsburgh Steelers T-shirts. And it's like, it's kind of like they're very pop culture. So like, you know, it might be something from like, something that happened in the game recently, or something, or I don't know, there. And so now you can only get them, you get, I can't remember the exact details. But it's like you pay for membership. And you get for a year, you can get one a month or you pick your amount. And then each month, you get to pick which one you want. So like, you're gonna buy half a dozen T-shirts a year, but you can only get them. If you're a member like you have to have a subscription. So, you know, it's not a subscription, it's a membership, but that really just gives you access to buy it. Yeah, I think there are a lot of clothing brands that could benefit from that.
41:10
Yeah. Do you have a referral link for that? I've never heard of that.
41:18
Are you serious?
41:20
Yeah. Good time. I will. I will. Alright,
41:25
sorry about your team this. Oh, yeah. But I just do it'll only make Wasn't there some stat they made the playoffs with the worst record they've ever had was a. It? I mean, it
41:43
very well could be the worst record we ever had for making the playoffs? Yeah, but we made it. Yeah. And we won't last long, but we're in there.
41:52
Sometimes, hey, look what happens when you're 1616 and old going into the playoffs? Right? That's a very good point. Um, but,
42:03
Jay, I really appreciate having you on the show. I don't want to take up too much more of your time. This is that quintessential moment where I kind of let you have your moment and tell everyone where they can find out more about you.
42:13
Yeah, I'm fairly so boldcommerce.com is where all of our products everything is. I'm fairly active on Twitter and LinkedIn. It's Jason and Myers if you want to follow me and like or bash anything I tweets, that's fine, too. Yeah, I would say those two places are good. Perfect.
42:34
Jay, I really appreciate having you on the show. Everyone who tuned in, obviously appreciates you guys tuning in. Make sure you rate review, subscribe, wherever it is you guys are sitting around but until next time, we will see you all again. Thanks for tuning in. And we'll see you again. Have a good one.
42:48
Thank you for tuning in to The E-Comm Show. Head over to ecommshow.com to subscribe on your favorite podcast platform or on the BlueTuskr YouTube channel. He comes show is brought to you by BlueTuskr, a full-service digital marketing company specifically for e-commerce sellers looking to accelerate their growth. Go to BlueTuskr.com now for more information. Make sure to tune in next week for another amazing episode of The E Comm show.
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