Subscription Box Basics with Julie Ball

Improve Retention with Bellwethr

April 06, 2020 Julie Ball Episode 20
Subscription Box Basics with Julie Ball
Improve Retention with Bellwethr
Chapters
Subscription Box Basics with Julie Ball
Improve Retention with Bellwethr
Apr 06, 2020 Episode 20
Julie Ball

#020 - It is said that it is easier to keep a happier customer than to find a new one. In this episode, Julie chats Samantha Forrest to talk about how to improve your churn.

Samantha is a Retention Engine Product Lead at Bellwethr. Bellwethr uses intelligent interventions to increase retention and revenue at the cancellation point in your customer journey.

Links:

Sparkle Hustle Grow
Bellwethr Retention Engine

Show Notes Transcript

#020 - It is said that it is easier to keep a happier customer than to find a new one. In this episode, Julie chats Samantha Forrest to talk about how to improve your churn.

Samantha is a Retention Engine Product Lead at Bellwethr. Bellwethr uses intelligent interventions to increase retention and revenue at the cancellation point in your customer journey.

Links:

Sparkle Hustle Grow
Bellwethr Retention Engine

Julie:

So you want to launch a subscription box and don't know where to start? Girl, you are in the right place. I'm Julie Ball, a subscription box coach and your host here at Subscription Box Basics, a podcast for new and aspiring subscription box entrepreneurs that want to avoid overwhelm. So grab a coffee, some pen and paper and let's have some fun! Hey everybody and welcome back to Subscription Box Basics with Julie Ball. I'm your host and your subscription box coach. One of my favorite things is talking about the subscription box industry so I created this podcast for you to come with me on this journey and make yours a whole lot easier. So you are going to love this episode because we're going to talk about how to improve your churn. And for the newbies, churn is the percent of customers that you lose every single month. So churn can be a result of cancellations, declined credit cards, expired subscriptions, a whole host of things. So the goal here is to keep churn low. I typically shoot for 10% or less, and we're going to talk more about that soon. But a 10% churn would mean if I had a hundred subscribers with a 10% churn, I can expect to lose 10 of my 100 subscribers each month. So you've probably heard that it's easier to keep a happier customer than to find a new one. Well today I have a gal on the podcast that will help you do just that. Today I'm talking to Samantha Forrest, Retention Engine Product Lead at Bellwethr. Bellwethr uses intelligent interventions to increase retention and revenue at the cancellation point in your customer journey. In other words, she helps you keep your customer. We love Bellwether at Sparkle Hustle Grow, and we've seen a big improvement in our turn since implementing the bellwether retention engine. So you guys are gonna love this stuff. So without further ado, welcome to the podcast, Samantha.

Samantha:

Hi. Thank you for having me.

Julie:

Awesome! So can you just tell our listeners a little bit about your background and then we'll dive into the details of how all of this works?

Samantha:

Yeah, so I am based out of Kansas City, Missouri and I started working with Bellwethr last July. Um , I was a high school math teacher for five years and I wanted to try something else, see what the real world was about basically. Um, and so I was attracted to bellwether because of what they were doing with machine learning and their goal of trying to make it accessible to everyone. Um, so I found them, they found me, we kinda hit it off and I landed at the company. Um, and so now I get to work specifically with our retention engine product. Um, and I meet clients and subscription box owners, subscription businesses, and I tell them about our products . I learned from them and hear what they want it to do. And I take that back to our team and we have just continued to improve the product , um , and throw things into our retention engine, which is hosted at the cancel point and tries to save you customers and we continue to put things in there that you didn't even know you needed.

Julie:

I love that. We didn't know we needed you until you showed up in our lives. So the retention engine, let's just, let's unpack that. Explain what that means. As you mentioned it works at the cancellation point. So that is like a really scary point for a lot of us subscription box business owners. It's like you're holding your breath when renewals go through every single night, you'd like wake up to see how many went through. And so how does this retention engine work at that point of cancellation?

Samantha:

Yeah, so the retention engine , um, takes effect anytime your customer hits cancel. And so there's four screens that are shown to the customer . So the first screen ask the customer, why are you leaving? Um , that's just valuable insight that basically any of your subscription management platforms already do for you.

Julie:

Right.

Samantha:

And then after that, u m, we show an offer to the customer. And so this is where our machine learning platform comes into play. U m, and we try to pick the best offer to show the customer that will prevent them from leaving. And so what an offer can be, it could be a gift. U m, you could say, stay with us and we'll throw in a free gift. It could just be communication. U m, we saw last month somebody c anceled because they were nervous about products coming from China. So this could be an opportunity to tell your customers, "Hey, our products are safe." or "Did you know that we h ad these other subscriptions, like a mini one" or first Sparkle Hustle Grow, you communicate that, u m, your box can also be a tax credit for them.

Julie:

Right, exactly. So it's like in that moment where the customer is like, eh, I'm not sure if this is still for me, I'm about to cancel. You're like, wait, "We have an offer for you!".

Samantha:

Exactly!

Julie:

Like you want to stay because of X, Y, Z and so those offers you work with the subscription box business owner to come up with the right offer. And um , we'll talk a little bit about what those offers can be, but what's the, what's the next screen after they see their offer?

Samantha:

Then the next screen after the offer is shown to them , um, is the pause screen. So a lot of times with subscription businesses, it's really not your business. It's a personal reason that they have a budget issue. They have too much product. Um, it could be a number of things. And so we show that pause option because that's usually a great solution for customers and businesses to just take a break. Um, and so that saves quite a few people. Um, that one's been really powerful. And then if that doesn't work, the fourth screen is the last and final. Are you sure you want to leave? Just make sure they know that this, once they hit this button, they are legit, canceled . Um, and so then they're canceled. So it's a forced screen flow , um, for you to engage with your users at that cancel point. And we've made it very easy with no coding involved. You just have to go and type in there. You can make it on-brand, change the language you can put in gifs, you can put in images , um, and really just talk to your users one last time and hopefully they stick around.

Julie:

It's such a powerful , um, off-boarding experience . That's what we kind of refer to as the offboarding is like, we don't want them to leave. So we give them, give them our final like , um, offers and it's just the flow of what you guys have built is so user-friendly as well. You know what I mean? It's um, it's not clunky. It integrates well with many platforms. Which platforms do you guys integrate with already?

Samantha:

Yeah, so we do Cratejoy, Stripe , um, Recharge, Charge Me and um , Bold Commerce. Those are the ones that are currently, like you could just get on there beyond there in 30 minutes and have this thing live. We also have more coming. We have WooCommerce is in our pipeline and Recurly so we've got more that are in the pipeline. And so we just always have that balance as a new business of do we continue making new integrations or work on those improvements and adding in more features for our users.

Julie:

Well, as our listeners know, we use and love Cratejoy and it's been a really good experience and it feels , it doesn't feel like you're moving through different software. It's built , it's still feels like you're in the same platform. So I love that. So just to give our listeners a bit of scope of like how this can impact things, do you have any case studies or numbers about, you know, how many cancellations have been prevented with , with some of your customers or what are some typical results?

Samantha:

Yeah, so on average , um, we're seeing around 20% of customers that start the cancellation process , um, and then our saves, but it varies so widely amongst says , um, our highest one for was 60%. Um, which was pretty insane and that's not necessarily typical, but then we have some as low as 10%. And that's okay too because you're still saving some of your customers. And so some things I noticed , like if you're a lower end point business, like if your box is only $15 a month, it's going to be a lot easier to save somebody than if it's $50 a month. So it really does vary widely. But the impact, the investment that you have to make here is so minimal with your time and the money as well. Because our lowest plan is just $19 a month. Um, that is just, we've made it to where it should make sense for any subscription business if you don't have something like this. Like it's too easy to not do.

Julie:

Yeah, I would agree. And just so you guys can feel, get a frame of reference of how it's impacted Sparkle Hustle Grow. In the past we've averaged probably a 10 to 12% churn . As I mentioned earlier, 10% was what I would shoot for and we've seen it as low as 6% and we're averaging right around 8% right now. And again, for every hundred customers that we have, that would mean we only lose eight each month and it's just made such a big impact in retaining those customers month after month , um , increasing the average duration of our subscriber, because if they're, if we're retaining them longer , um , then that means they're staying on longer. That means recurring revenue, easier to project your revenue. It's just this huge win-win. So let's talk about some of the offers. How does the software determine what offer to show the customer?

Samantha:

You as the business owner will come in and create a handful of offers and then you can decide which reasons are tied to those offers. So if somebody canceling because they think your product is too expensive , um, you can check certain reasons and tie them to the offers. And then the machine learning algorithm will pick only one of those offers to show based off of what's available on the reason that the person canceled for . And then as it learns after each experience. So if the customer accepts the offer, then that's counted as a success and it raises that performance percentage. And if it doesn't, then it fails. And so it's also this delicate balance of we're not just gonna figure out the that 50% off says every single time and just keep doing that. We're always going to do this part of exploration where we're still going to play with those ones that might not be performing quite as well and throw those in there occasionally because things could change. So that's the whole machine learning aspect of it. And we've been able to find some really interesting things. So, for instance, like with your box, you try to $10 off and a 20% off and those are about the same value for your, for your box. And I'm thinking the $10 off that one was the one that outperformed . So that gets shown more than the 20% off. It's your customers .

Julie:

So it all really depends on what's working for your customer. And the software is going to constantly try to improve like which offers should we show this person?

Samantha:

Right. And so in contrast, like with your Facebook ads, you have to go in there and look at it each day and see which one's outperforming the other one and then decide to turn one off and start showing this one . So you have to keep optimizing it on your own. This is all self optimizing. So get to start by just like thinking of what might work. Let me try it. Um , you could say the same thing three times and put in three different images and eventually it will learn what's working best.

Julie:

That's so great because I gotta be honest with you, Samantha, we launched this a couple of months ago and I've only gone back into the software probably once a month just to kind of poke around and look at things. But it's working on its own, you know what I mean? It's, it's constantly improving and it's one of those, I don't want to say set it and forget it because I do go in there, I try to stay on top of the analytics, I try to see what needs my attention. But since we've launched it's needed very little attention, which for someone who's spread thin or just any busy subscription box owner, there's so many moving parts already. It's just such a , you know , a breath of fresh air to not have to constantly be like working on this system. So I appreciate that. It that it's self optimizing. So , um , I want to mention one of the offers that I think is important to talk about is the customer service one. And you and I talked a little bit about , um, you know, sometimes people are going to cancel because their budget changed or sometimes people have enough stuff already or they just need a break. Well , sometimes there's actually a problem and that you're not aware of. Maybe there's damaged product or maybe their box never showed up and some people are very vocal about those things, but some people just kind of sit back and they're like, well, I'm just going to cancel. I really appreciate as a small business owner, the opportunity to make something right. If there's a problem with a product or if you didn't get your box, we want to , we truly want to make it right. So we've implemented an offer where maybe you can help me walk through explaining this, but if someone says they're , um, there's a customer service problem or there was something wrong with it, we talk to them about our support email. So we send them to support@sparklehustlegrow.com and I think that's so impactful. Have you seen other box owners using something like that to help save their customer when something's actually wrong? It's a customer service issue.

Samantha:

Yeah, absolutely. In a couple of them do it different ways. Um, so with that particular offer, it basically just has a little email us click on there and of course you can, you know, script the language and say, we're so sorry we wanna make this right. But then they just basically click it and then it pops up the email tab and so then they can just email you directly. So that's another thing is we make it very easy for customers with like a pause as well, like just one button, they can pause it. And so with the email, some business owners will say, we're sorry, we have a special offer, email us, let us know what's going on and we'll throw in a special offers. So they kind of do a little bit of both.

Julie:

So what do you see some of the best offers across the board?

Samantha:

I mean, I think anytime they make it on brand and are showing , um, you know, putting your voice into it. And reiterating the reasons that people are signing up in the first place. I think those always outperform. We had one company, Keto Crate has gone so in depth with this and I think they have something like 23 offers in there and they've gone and they really wanted to get scientific about it so they have some very bland ones. Like our default ones was like, stay with us 25% off versus Hey, did you know we have this great , um , like chocolate treat that's going in your box next month. You're not going to want to miss this. Take 25% off and stay with us, Ooh, I like that. Both of those. Um, and you know, and then it starts the ones that are on-brand start performing better. So just taking a little bit of time to remind people why they want to sign up. Like you put a lot of effort into your language when you're marketing and you're trying to acquire customers. So just recopy that and put it in your retention engine and it works there too.

Julie:

That's great. Great advice. I was expecting you to immediately say the ones that are like X amount off or X percent off. So I didn't really think about it that way. But brand voice would be so important to reconnect with that customer at that point where they're like almost ready to break up with you.

Samantha:

Yeah, exactly! Reminding them of something like um , Creation Crate, they remind uh , their customers that they have a new education outlet . So some of the people that signed up really early on, they might not be aware that , um , if they're having issues with our projects that there's a whole new online help school that they can go to and watch videos.

Julie:

That's so cool. Yeah, we use that too with our, one of our offers is, "Did you know we have a Facebook community where you can connect with other entrepreneurs:" and then we link to it. So if we have, if someone has multiple offers that are, say $10 off, how do we make sure, how do you make sure that people aren't going to go abuse the system where they're going to go pretend to cancel? Just to get that offer again and then do it month after month after month.

Samantha:

Right! So we make sure that if somebody accepts an offer, they can not be shown that offer again. That's the check we have in place right now. And you have to understand we're only about five or six months old with this product, so we're beefing it up all the time. So we're like really diving into that right now and we're going to start setting limits on like if they have a percentage off, we're not going to show them any discounts for a couple months, but then maybe wait three months. So things like that, we get really deep and that's why you have so much as a business owner to worry about. So we're talking and thinking about this every single day and looking at all of these engines and thinking about how can we make this the best for these businesses? Because there's conversations like that that get really complex that we have to fight out. So we make sure that they can not see the same offer. So if you have a $10 off, they're not going to get to see that again. But then we're going to go even further. If you're going to have 20 offers in there that are all discounts, we don't want to show them each discount every single time.

Julie:

Gotcha. Yeah. And cause that could get, that could really become a burden on the business owner. So we appreciate that that you have things like that in place. Okay. So the big question then, how much does ti cost?

Samantha:

We have made our pricing very flexible to fit many businesses. Um , the lowest is $19 a month. And so what that is, is up to a hundred cancellation experiences. So if you're under a hundred cancellation experiences, it's $19 a month. The next plan is $99 a month. And that is if you're under 1500 cancellation experiences. And then beyond that is if you're under 3000 cancellation experiences, it's 249 a month. And then after that it would just be a custom plan.

Julie:

Gotcha. Okay. So guys, we're recording this on March 11th, 2020. So at the time of this recording, that's the current pricing and it's super affordable. I mean starting at $19 a month, that's gonna fit the budget for a lot of our listers. So do you have a free trial going on?

Samantha:

Absolutely. Um , we want you to see this for yourself. You don't have to take our word for it. It is free for 30 days. That first 30 days. Anybody you say there's just money in your packet? I get, we don't do any contracts or anything like that. Um, we believe cancellations should be easy. And so if you don't like it, you just email us and we'll take it off.

Julie:

Right on. So we have more details about the retention engine. We'll put the link in the show notes, but it's RetentionEngine.com/JulieBall. That's J. U. L. I. E. B. A. L. L. and so one last question, Samantha, is what does the onboarding process look like now? You said like, we don't have to know any code. We don't have. If you make it easy, so easier, the better. So what does that onboarding experience look like?

Samantha:

So the onboarding experience. Basically if you just go to Julie's page, there's a free trial button, you click that button and it takes you to create an account. You'll create an account, you have to connect some API keys, but we have a help doc right there that you can click on and it'll show you exactly where to find this in your subscription platform. And so the API keys just allow us to communicate back and forth so that everything is automatically handled. If there's a pause, a discount with cancellation, you don't have to do anything. That's what that is. Um, you go in, you can just click around and if the reasons you can put in your logo, change the colors, really just clicking, adding images, links in those offers. And then to , um , make the thing live . You have, there's a little HTML tag, which is basically just like a little snippet of code that you have to put in on your platform, on your website. Um , but again, we have directions for all of this based off your specific platform on where you put it. And what that does is when the person, the customer hits cancel instead of going through the normal cancel flow, they'll go to our offboard retention engine flow .

Julie:

Perfect. And you said, you know someone could get set up within like 30 minutes or so.

Samantha:

Yeah, we have a record for first saved customer. So like from somebody creating their account to their actual first saved customer was 49 minutes and if you beat it we will send you a pizza.

Julie:

That's so fun. All right guys. Who's getting the free pizza? Who's going to beat that record? I know y'all are competitive out there. So Samantha, thank you so, so much for joining me today. I love what you guys are doing and it's , it's been so impactful for Sparkle Hustle Grow. I'd love to have you on again so we can chat about what other things you guys are doing, what you have coming down the pipeline. And again, if you guys need some help with your churn, you can get details on Bellwethr's retention engine at RetentionEngine.com/JulieBall. We will be sure to put that link in the show notes. I hope you guys enjoyed today's episode. Thanks for listening as always, and I'll see you in the next episode.

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