Ever wondered how to keep your subscription box business booming when post-holiday belt-tightening hits your customers? That's exactly what I am covering today, with lessons I have learned from my own BusterBox journey.
Discover how offering payment flexibility and a pause option can dramatically reduce churn, and why a strong saves process is paramount. And don't let passive churn from failed payments sneak up on you; we're sharing how to keep those subscription renewals smooth and steady.
I also explain how 'Add the Box' is a great way to grow revenue in January (your existing subscribers will buy more products from you) and am teasing the details of my 'Subscription Box Cash Machine' workshop (it will be coming soon). January can be a great month for customer acquisition as CPM prices will drop and there are still buyers.
In this episode, I cover how to take advantage of that. If you have a question you want answered on the show, make sure you head over to the free Facebook group at www.SubscriptionBoxResources.com and post it there.
Ever wondered how to keep your subscription box business booming when post-holiday belt-tightening hits your customers? That's exactly what I am covering today, with lessons I have learned from my own BusterBox journey.
Discover how offering payment flexibility and a pause option can dramatically reduce churn, and why a strong saves process is paramount. And don't let passive churn from failed payments sneak up on you; we're sharing how to keep those subscription renewals smooth and steady.
I also explain how 'Add the Box' is a great way to grow revenue in January (your existing subscribers will buy more products from you) and am teasing the details of my 'Subscription Box Cash Machine' workshop (it will be coming soon). January can be a great month for customer acquisition as CPM prices will drop and there are still buyers.
In this episode, I cover how to take advantage of that. If you have a question you want answered on the show, make sure you head over to the free Facebook group at www.SubscriptionBoxResources.com and post it there.
Welcome to Subscription Box Answers with your host, liam Brennan. You're no rubbish, no crap. Straight to the point podcast with real, actionable tips, real strategies and insights from the industry which will help you start and grow your own successful subscription box business. You ask the question, you ask the questions, liam gives the answers. It's as simple as that.
Speaker 2:Welcome back and a happy new year. I hope you had a really nice Christmas. I hope you're fully recharged and you're ready to push your subscription box on to the next level in 2024. I actually had a very quiet Christmas myself. I never got up to much, went away for a few days and took a break. But now I'm back and I'm looking forward to getting back into it and hopefully having a very good year. I'm actually hopeful that 2024 will be a good year for direct to consumer and subscription. I know 2023 was quite challenging, but I'm hopeful that we're on the other side of that now and things will start getting back to normal.
Speaker 2:Now, on today's episode, I'm covering January and I'm giving you some advice so you can start the year strong, because January is actually a strange month for subscriptions, mainly because people overextend themselves at Christmas and they spend a lot of money Everybody does it and then they come back in January and they're like I need to sort out my finances and they go through cancer. Subscriptions and it's not only subscription boxes, this is everything Gaming, software, memberships, whatever. The only one that does really well is Jim's. That's the perfect subscription for January. It's the ideal time for them because everybody obviously wants to get fit, but there are things you can do to help lower your churn rate. And listen, not every subscription box will see a jump in churn. Some niches actually do very well. Say, if you're in the health niche, wellness or anything to do with business and finance, january churn can actually be very good. But if you're not, don't worry. I'm going to cover some things now which will definitely help you lower that January churn. I'm well aware of this at this stage because we've been running BusterBox for many years and, yeah, we basically know what a typical January looks like and we know what you can actually do to have a great January and start the year off really, really strong.
Speaker 2:So number one, right when it comes to churn be flexible. Let people skip. Don't give them the choice of canceling or paying, because if that's the only choice they have canceling or continuing the subscription you're basically forcing their hand to cancel. You need to allow them to skip in January if they want. Even if they signed up for a six or a 12 month Commitment in December and then they come into January and they're looking to cancel due to a financial reason, you are much better off giving them the opportunity to pause until February. That will actually allow you to save a lot of people. That makes a massive difference to your January chart. Number two have your saves process down to a T.
Speaker 2:You should know all the main reasons why people cancel your subscription by looking at your turn data and cancellation reasons over the last 12 months. This is relevant for any time of the year, but it's especially helpful in January. You need to identify the main reasons why somebody is likely to cancel and actually have solutions for those reasons, and then train up your support team to fight the cancellations with those solutions. Now I'll give you an example and I've covered this before, but this is what goes on in my business. For us, dogs destroying toys quickly is a big reason why people cancel. People get really angry not everybody, but some people get really angry over this. They feel like they're not getting good value for money if the box arrives and the dog tears all the toys to pieces. So for us, we give them the opportunity to switch to tougher toys and that makes a massive difference to our chart. Think about it If one of the main reasons why people are canceling is because toys are getting destroyed quickly and then you actually have a solution that solves that 100%, that will have a big impact on the chart, and you should be looking at the exact same thing in your business. It doesn't matter what niche you're in. You need to look into the reasons why people are looking to cancel and then actually come up with solutions. You're going to have a few reasons that stick out, so make sure you come up with a solution that works for you and the customer and then offer it to the customer when they want to cancel, and you're going to be very surprised by how many people take it and what difference it makes to your chart.
Speaker 2:The next point Passive Chir. Now, I've recorded a detailed podcast about this last February. It's called how to Reduce Passive Chir, and I highly recommend checking it out because it goes into detail about the correct way to fight this. Now, in case you don't know, there are actually two different kinds of chir. Number one Active Chir this is just normal chir, this is just when somebody wants to cancel. And then, number two you have Passive Chir, and this is when you can't charge the card but the customer still wants to continue, aka a failed payment, and this can account for a massive amount of your chir, especially in January when people may be low on phones. So check that podcast out because it explains how to fight this in detail, and having a process in place to fight Passive Chir not just around January but throughout the whole year, is vital if you want to scale any subscription business.
Speaker 2:Number four Gift Subscriptions. Gift subscriptions can account for a lot of cancellations in the next few months as well, because obviously you're going to sell a lot of gifts coming up to Christmas, but you should not account for them as part of your overall chir because it's not actually a true reflection of your business. So when you're looking at your monthly chir rate, you should 100% filter out all of the gift subscriptions. They were purchased as gifts with a expiry date and it's very rare that somebody will pay for somebody's subscription for a very long time. They usually last for a set amount of time and that's it. They cancel and that's the end of them. The gift is over. But it's still not nice when you see the cancellations come in true, and there is actually something you can do to help with that. Now, I've seen this come up many different times, but I noticed Taylor posted this in the private Subscription Box Experts group and it jogged my memory because it's actually a really good idea On the final box of any gift subscription. You should put an insert in that box with a really good offer, and obviously the idea behind that is you're trying to convert the gift subscriber into a normal paying subscriber. It's just a great way to minimize that churn and get people to come over and sign up for a normal subscription Because, let's face it, if you're doing a really good job and the person likes your box and then you hit them with a good offer, it's likely that a percentage of them will come over and convert into normal paying subscribers. So I definitely recommend doing that to help you with that gift churn.
Speaker 2:Next point add the box. Add the box is a great way to keep up revenue in January. If you do see higher than normal churn, your current subscribers will buy more stuff from you and we're doing a lot of this in Busterbox. We actually have a process called the reply yes process which gets a lot of our customers adding things to their box and it generates a lot of extra revenue. Now, if you don't know what that is, you're in luck, because I actually do have a new training workshop coming out soon which covers this in detail, and it will make a massive difference for Anybody looking to make more money from their existing subscribers in 2024. It's called the subscription box cash machine training, and it will be out in the next week or so and I'll have some more Information about it soon. But just briefly, if you don't know what the reply yes process is, you basically send out a personalized email to your subscribers and you give them the opportunity To add some more products to their box by just replying yes to the email. It converts really really well and, yeah, I highly recommend doing it, and if you're interested in learning more, I will have some training coming out around it very, very soon.
Speaker 2:Okay, now moving on on the acquisition side of things. You may be surprised by what I'm about to say, but January is seriously a underrated month when it comes to get new customers signed up. Now, it won't be like this for every niche, but a lot of the time January can be a really really good month, and the reason behind that is CPM prices drop heavily as competition comes down. Now, if you don't know what CPM prices are, let me explain. This is how much you're paying to show your ad to a thousand people. So this could be on Facebook, tiktok or really any online advertising platform. You're always going to have a CPM price and that dictates massively how expensive your ads are and your customer acquisition cost, because obviously if your CPM price is higher, normally you're going to have a higher customer acquisition cost. Now, during Q4, cpms get really expensive because you're competing with a lot of different brands. But in January brands drop their budgets and they pull back from advertising and it means it's usually cheaper. Now the purchase intent isn't as strong as Q4, but that doesn't mean there aren't buyers there who will sign up to your box. And you mix that with cheap CPMs and you can have a pretty promising month on the acquisition side of things because you can pick these people up Relatively cheaply.
Speaker 2:Now the key, as always, is to have a relevant offer that converts. Now, unless you have been planning for a while and you have like a ground breaking offer lined up for January, it can get a bit overwhelming. You're kind of thinking what my gun to roam, what be the best offer to do? And well, look, I'm going to give you a very simple tip look back over your last 12 months and Figure out what converted the best for you. Find the offer that converted the best and just bring it back in January If you don't have anything else lined up and you can try your original creatives. But I would actually recommend Changing things up for January. Okay, come back with the same offer, but with fresh creatives, fresh emails, and there's a high probability that it will work for you. If it worked in the past, it will probably still work now. Now for us, we're actually going to stick with a free bed offer for January, as it's been converted so well. But obviously we've removed all of the Christmas branded, because during December it was all like Christmas themed on our website, but we got rid of that, and just before the new year.
Speaker 2:Also, something to consider is January can be a real month for people where they're feeling a bit down in the dumps after Christmas, so that is a really good opportunity to position your box as something that will cheer them up. Some people tend to treat themselves to lift their spirits up, so if you mix that market and angle with a really good offer, you're probably going to do well on the customer acquisition side of things in January. Now, obviously, for some niches it'll be a bit easier In January. Like I mentioned previously, if you're in the health niche fitness, self-care, finance, anything like that January will typically be a very, very good month for you, probably without much effort, to be honest with you. But other niches, like my own, the pet niche you do need to get a bit creative.
Speaker 2:But that doesn't mean you can't start the year really strong, because I hear sometimes with people in this space they tend to write off January and they're like oh, there's nothing you can do in January. The churn's really high, it's hard to get people signed up, we're just writing it off and we'll come back in February. That isn't the correct approach. If you do what I just covered in this podcast, you can start the year really strong. Now, as I mentioned previously, I'm going to have a new workshop out very soon called the subscription box Cash Machine Training. It will show you how you can make a lot more money from your existing subscribers. So if you're interested in having a very profitable 2024, I definitely recommend checking out that training and love more information soon. But other than that, we'll be back next week at the exact same time. If you have a question you want answered on the show, as always, make sure you head over to SubscriptionBoxResourcescom, join the free Facebook group and post it there. Speak to you next week. Have a great day.