What You Need To Know About Subscriptions

Episode 034: The subscription business model is one that is loved by both customers and business owners. Join Vonda and Lori as they take a look at the types of subscriptions and touch on a few suggestions to get you started with flower subscriptions.

Sponsored by:
Flower Clique
Flower Clique Prep School
Real Life Retail Florist

Transcript

Vonda 0:04

So it's interesting. They actually break down subscriptions into three buckets, kind of interesting. So three categories first is replenishment. Welcome to the business and pleasure of flowers. We're your hosts. Vonda LaFever.

Lori 0:23

and Lori Wilson . And we believe that business and fun are a perfect combination. Kind of like us, Vonda.

Vonda 0:41

Lori, it's good to be back.

Lori 0:42

Yes. Yes, it is good to be. Back in the sun is shining. I was listening to a podcast that I've been listening to and it's silly. Like it doesn't educate me at all, but it's funny. It's like a couple of celebrities that get together. Anyway, they did an Instagram live yesterday and there's three of them but only two of the podcast people were on there and they always have a guest. I will start laughing because they were doing like a Q and A people were typing in questions. And one of them was, how long do you practice before the podcast? And they both just started laughing and they're like, Oh, are we supposed to be practicing ? Or are we supposed to have a script? If you guys have one for us, send it. And I started laughing . That's kind of how Vonda and I are.

Vonda 1:25

We come up with this subject and we do a little research.

Lori 1:28

and then we come together and talk about it. We're doing it the right way. I think the ones that sound too scripted, they're not as entertaining. So, we have a lot of bloopers in ours.

Vonda 1:41

We do, last week, we talked a lot about decision fatigue.

Lori 1:46

Yes. We got a lot of feedback from that. VI . I was posting it on our podcast page. So many people commented, but even private message me. And they're like, yeah, it's real. I have it. When we were doing all the research, it's been around for a long time. It's just recently reared its ugly head because of COVID right? Because of all of this quarantine.

Vonda 2:10

I wanted to kind of segue that decision fatigue into something else. When we launched flower clique at the beginning of the year, we added something called subscriptions to our managed websites. It's not new. Right? The increase in the number of purchases of subscriptions has really gone crazy.

Lori 2:30

Yeah. It's interesting because you've been in the industry a long time and I've been in nine years. And as far as I can remember, subscriptions, some shops do them, some shops don't I've even had people ask, does anyone know of a flower shop that does a subscription around mother's day? We have so many members. It became almost, like I sold another one. OMG, I sold a six month one. And so I think the old concept of subscription a year long, but we gave choices. You can have a three month or six months . And so you think of that three month, it's not huge investment in it. Right. And you can try it. And then the goal would be to upsell after that three months . Hey, do you want to do it again?

Vonda 3:18

That subscription model is really accelerated right now. It's very interesting when you do the research on it, to see how many people have really skyrocketed in the subscription business. But what I want to do first is kind of go back and go, you know, where did it start? Yeah. So it started by the book of the month club. That was the first true scription box. And it was a brain child of Harry Sherman who was a journalist and advertising pro who believed mail order was the best way to break into literature, deficient rule, book, market. Isn't that crazy? It was , you remember the days they would send you the book and if you didn't like the book, Oh well you could send it back. Otherwise, most of the time he just kept it and thought, Oh, what's the.

Lori 4:08

because it's a pain in the rear end to have to go take it to the post office and mail it back.

Vonda 4:14

Exactly.

Lori 4:15

So usually you just like I'll keep it, but maybe the next month will be better. Yes. So that's what it started is with the subscriptions . The, you do have any subscription services or boxes that you order.

Vonda 4:27

Interesting. I do not have any subscription boxes that we order, but if you look up subscription model, so the subscription business model is one that the consumer pays a recurring price right. At regular intervals. Right. So oftentimes we think it is like that beauty box, probably you're going to tell me you get, but my subscription services would be like Salesforce, which is my technology customer repository. So there's certain things that sometimes we don't think are actually subscriptions, but they really are.

Lori 5:09

Yeah. That's true, it's the same business model. We just don't really realize it . So yeah. I get a box it's allure.com. I think I got Ellie hooked up to do it too. And the thing is, it's only, I don't know, $15 a month. It's a price point to where I don't really notice it when it comes in on my credit card or whatever. And it's mostly a little trial size makeup and stuff. And so it's not even about what's in the box. It's the excitement I get because I got a box. And I love that feeling. And I will tell you, there's a bunch of stuff in there. I ended up donating like the family promise or some places that I don't need. And , but that's okay too, because you never know that next month might be something I love. So maybe I'm kind of like that book of the month people, I keep thinking, well, the next month I'll like the books the next month.

Vonda 6:05

That's true. I didn't even think of that.

Lori 6:07

Yeah. So I also do HelloFresh that we've talked about before. Actually we have some flower clique members that love it too. Especially for a working mom, busy mom. I like hello fresh because you have a little bit of say like you can pick from the menu items, how you were talking about the book of the month club. You just get what to get and you don't throw a fit right back in the day. Nowadays, I think they got to up their game a little bit. Like my HelloFresh , I can pick from these certain menus or how many meals I want that week and what weeks I want, but it is constant income. And if you don't go in and make those changes, just like the book club, you're going to get it. It's going to whether you wanted it or not. And you're like, shoot, I forgot to skip this week.

Vonda 6:58

So it's interesting. They actually break down subscriptions into three buckets. Kind of interesting. So three categories first is replenishment. And that's like for convenience, you know, when you go on Amazon and you order your dog food, for instance, and it says, do you want this to be recurring? And how many months do you want us to ship this to you? Every two months? That's like a no brainer, right? Certain things. It's just, you're replenishing what you already have. And it's an ongoing now replenishment sometimes is personalized to your taste, right? Because you're picking,

Lori 7:35

you still need to know what kind of dog food you want or the type, you know, where I could see a shop doing that type of subscription is with corporate. It could be with a hotel. It could be with doctor's office at a lawyer's office, whatever, sign them up for a year long subscription to have that replenished once a week or whatever. To me, the key to that, the selling part of it, that would be key is to show them, look, you sign up for a year. It's this price. If you were to do this individually, it would be this price.

Vonda 8:15

A lot of businesses do that. There are monthly flowers that are sent to the reception area in Vegas. They do that all the time, right? They did. Until all of this happened. People had weekly lobby flowers, you know, we're redoing this huge display and a lot of businesses were doing that as well. This time, right now it's a little bit challenging even with businesses, because they aren't even open.

Lori 8:39

for sure, I talked to one shop a couple months ago and I was asking her about her corporate accounts. She did a lot for a lawyer offices at the time, maybe I've said this on here. So if have just fast forward through this, I can't that when they called to say, you know, we got to put a hold on this. She said, listen, let's continue to do it. And I will deliver to the homes, give me the list of the attorneys that work there. And I'll just do one by one until we can get back. And it kind of was like , uh , Oh, but you know what? That's a nice idea. What a nice little surprise. Right? So that's how she redid it during this time. However, I do think now that particular place is back in their office .

Vonda 9:30

So that replenishment thing is good. That's your blue apron, right? Cause it's personal. It's my blue apron or hello Fresh my allure, I don't get too . It gets replenished, but I don't have a say in what comes. Right. Okay. So then the next one is curation. I think that's your beauty box, right?

Lori 9:49

Yeah. That is my beauty box . Yep . They're pulling together what they're calling quote unquote, top rated beauty things. I haven't seen a change in my beauty. I always have hope that the next box is going to be good. So that's what it is.

Vonda 10:08

And honestly flowers can fit in here too. If you think of that, when somebody orders flowers for a birthday or an anniversary and you hear the significant other or mother or father, whoever ordering those flowers and they say, she likes these colors, the purple flowers, this is what I'm looking at. So now then you have that listed on your point of sale system, the customer notes. Now then it's your responsibility to say, Hey Lori, you know, Mark has his birthday and anniversary on the same day, every year. Can we set that up to have flowers delivered every year on that time? So that's a subscription it's only a yearly or by yearly subscription. But think about that, that takes it away from you having to remember that date and mess up.

Lori 10:57

No, I love it. I also think so the experts pulling together pieces like the designer is creating this just for these people. Before I did the allure box, I did fill out a five question survey or something like what type of skin do you have? What is your favorite color to wear? It made me think, Oh, they're customizing all of my boxes to fit these needs. So it made me feel like it's a little more custom. I think flower shops could do something like that. Even if they don't send out an online quiz, they can have it over the phone, be about the person. And then based on that, we're going to come up with something we think will be perfect.

Vonda 11:39

Exactly. The third is access and that's more that membership model. That's what I was telling you about the tech. I think a lot of times shops don't realize that even their point of sale systems actually a membership, you know, you're like, Oh, but I paid this person this much money for that. And I purchased this years ago when there was technology that was emerging, a person would have to pay 20 to $50,000 to have technology created for them to use in their business. Now people are just buying it month by month and paying for support or whatever it is. And so it seems like that's something that never goes away, but it's, that's a membership. That's a membership model of a subscription.

Lori 12:29

Right. So let me ask you this. We've got replenishment, curation and access. Which one do you think flower clique is?

Vonda 12:39

Flower Clique would be, I would well interesting. Yeah, exactly. I was going to say the access, but really replenishing because we're continuing to replenish their website with fresh new images. We're doing it specifically for them. A lot of times they're giving us certain things that are selling better in their market or Kammie and her crew have created gift items that they're selling in their store. And then the access membership model is they have access to everything we have.

Lori 13:09

Right? Yeah. And then interesting thinking about that . We are a virtual company. So I guess technically they are paying a subscription, a monthly subscription to be a part of it.

Vonda 13:21

which is your Amazons, your Costcos , your Netflix. I mean, think of this right now. People who are on Netflix. I mean, they would never think about giving up that membership at this point.

Lori 13:33

No, no, but speaking of Netflix, can I just say all three of my kids are in trouble because they keep giving out my Netflix username and password to their friends. And then when I get on, it's like, we're sorry too many people are on it. Kidding me. So I'll go in and change the password. And within 10 minutes I get at least one kid going uh, What's the password. I'm like, you're the one that did it stop doing that. So, sorry I digressed.

Vonda 14:05

that's okay. That's why Amazon lets you share with X amount of people and then they get that information.

Lori 14:12

Yeah. So a question I have in this subscription services, one thing I want to say is there is still always room to upsell subscriptions always have. Yes, you can have this but make sure they know there's also this a couple of tips. Make sure you're always informing them of your newer, bigger and better products. And maybe you're even carrying a line of something new. I know a lot of shops who are fully open now and still have candles or alot have a lot of boutique style clothing, even make sure they know, Hey, when we send this subscription out, we've got these really cute sweaters that are one size fits all. Do you want to throw that into, since we're sending this to your mom, don't miss out on that. Just because they've already paid and it's a subscription doesn't mean they might not go, Oh, you know what? That is a really good idea.

Vonda 15:14

Well, I think it's open communication to that person. Right? So now whoever's ordered those flowers for the upcoming birthday and you know, you have it. So you're going to call and you're going to go . I just want you to know we have you covered for the birthday. And let me just tell you about two other things that might be something that she would like. That's what you're saying is to take what you already have and use that opportunity to say, what is that add on what is , what else can we throw in there to make it extra special for that day.

Lori 15:45

To me, that's where that information in your POS system or wherever you're keeping it. You know? And I mentioned earlier, take a survey. Maybe you find out in that survey that the person, the flowers are going to be going to their favorite colors, pink and you just got in a bunch of pink flamingos. I don't know , whatever you get in. Give that opportunity to get that personal email out or call and go, Hey, I know your mom's favorite color is pink. We just got in the cutest pink stuffed flamingos . I think it would be awesome if you put this in because you're also adding that personal touch and they're like, wow, they remembered that my mom's favorite color is pink. Just those little things that I think make it more enticing maybe. And I mentioned this before to make sure they understand. If you do have three months, six months or a year, be very clear on the price differences. When you break it down, if you buy the year, this is how all those average out you want them to see. Everybody likes a deal. They like to know, Ooh , that's the better deal.

Vonda 16:55

you think subscriptions have a lot to do with price.

Lori 16:58

Yes and no. Let's go back to how you sell them. Right? Something that we were telling our shots during mother's day, if someone's calling for mother's day and ordering flowers that are going to be from me, brother and sister, right ? And they're adults, they're going, Hey, you know what your three should do is sign her up for a subscription, right. Divided by three. That doesn't sound bad at all. So I think everything has to do with price, right? You could do a higher price, but you're not going to have as many people sign up. Do you think it doesn't have anything to do with price?

Vonda 17:37

I think it depends on the customer. I think it's knowing your customer base. And I think we need to get into this deeper at some point, maybe there's different levels of subscriptions and it's really based on the customer and the type of customer.

Lori 17:51

No, I agree. In some of my research, they were talking about tiers. Make sure you have tiers loving two , three , and know your market. You know, it was talking about market as a whole, but know your know your customer and know which tier like someone like my husband. He would be someone that would be the perfect person to sell a year subscription. Yes. Price is important, but convenience is even more important. Someone like me a year. Well, if I'm going to go and have these with my siblings , then I'm in. Right. You know, so it's just mindset. So have different tiers.

Vonda 18:35

because there might be customers who would just want a nice wrapped bundle of flowers, but get it every week. So it's, it's trying to figure out your customer base. And like I said, we need to get into that a little deeper, but what if someone wants to start doing subscriptions now? Well obviously put it on your website, advertise that you are able to do subscription services, but what is another way Lori , that you think people could start building that subscription business?

Lori 19:05

I would get on the phone. I would call my top 10 customers. I don't know if this is the right thing to do. This is what I would do in my business. I would get on the phone, call my regulars because my thought is you get them in and they start liking it. And then you reach out to them and ask for a review. And then you take those reviews and you put them on your social media. You put them on your Google and that's how you get traction. And the thing is, that's all free. It just takes a little legwork .

Vonda 19:36

It takes courage to pick up the phone and make those calls to start.

Lori 19:40

that it does. It takes, it takes a lot of courage. But I think right now in this weird era we are living through, it's definitely the time to try it. You know, I was talking to my sister yesterday. I think I told you this on how, you know , she takes care of my father and he was having kind of a sad day yesterday and she had to go back to work. She just ran home for the lunch and she put on our podcast on her iPad because he doesn't have something . And she goes, listen to Lori . You can listen to Lori's voice. And it comforted him. Honestly. I guarantee you, he fell asleep, but that's okay. Got a smile on his face. And he listened because we can't be together physically. If my dad appreciated flowers, the way my mom did when she was living, I would be signed up for a year long, weekly subscription for her because that would have spoken straight into her love language.

Vonda 20:43

Yeah, for sure. And seems to me that with the point sale systems that people have, you know, when there's a birthday or anniversary coming up because of the reorder process. So if I knew somebody who had a birthday coming up and I'm looking at my customer list, I would pull all the upcoming birthdays, all the upcoming anniversaries. And those are the ones I would start with. You know, we asked your top 10 customers, but also somebody who has something coming up and saying , Hey, you know, do you remember that? It's your mother's birthday coming up? Gosh, let me tell you. I have some great ideas for her.

Lori 21:17

Yep. No, I love it. The worst thing they're going to say is no thanks. I've got it covered. No , we've got it covered. We're not doing that this year, but I, I think you'll be surprised because this year they're like, Oh, that's different. That's out of the box. That's a really good surprise. It's the whole, we can't be face to face right now. I think that's why so many flower shops. They thankfully are flourishing. It's been crazy, between funerals and individual deliveries. It's hard for me to get anyone on the phone. That's a good thing. Yeah , no, it's good. It's a good thing to have, but it tells me now is the time people are wanting to buy. They are, they are open. They're open to it.

Vonda 22:04

And the best thing we can do is try to make that recurring.

Lori 22:07

Yes. Recurring income, recurring revenue, recurring revenue.

Vonda 22:10

Let's get it going. So I think Laurie , let's just wrap this up. As far as flower subscriptions, a couple of things to do, and you just mentioned it. Get on the phone and call your top 10 customers, your anniversaries or birthdays, special occasions coming up, make sure it's on your website. Make sure that it even is an option for them to even think about it when they go to your website and say, Oh, I hadn't even thought of that.

Lori 22:36

Yeah. And you know what? I would love to our listeners, our cliquers, your clickers or our pod-casters you guys, if you try this, let us know like comment on our Facebook group. I want to know who's going to implement this. Did it work? Did it not work? You can email me if you don't want to put it out for the whole group to see you can private message me. I'm just curious. I want to know if anyone's going to try to implement this, or maybe you tried it already and you're like, eh , it did not work. I want to hear that too. And I want to know why, so we can kind of triage and figure out why do we think it didn't work? What are we seeing? Right,

Vonda 23:20

right, right. Exactly. Because there are certain things that we probably are missing. And like I said, I think we can get into that deeper in another podcast. Maybe it's what we're offering is not right. We don't know. But that's a really good point. Lori , let Lori know, let us know on the Facebook page. We'd love to hear about that.

Lori 23:38

We would. So we've had a lot of good stuff on the Facebook group lately. A lot of people with questions and I love it. I learn . And it sparks kind of like what we were talking about here. Somebody was talking about, they mentioned Amazon prime. They were doing a one time fee for free delivery all year, which I don't know as a customer. That doesn't mean a lot to me because I probably only order four or five times, but it sparked us thinking, what are some good? What are some other marketing ideas that are worth trying? And so we know this one works. Um, okay . The, it's the question? What are you loving right now? What is giving you life? And I'm looking at your face and I'm about to start laughing because I know you have had a house full. Cause we talked about it last week, but it's been so much fun.

Vonda 24:30

Oh, we've had a great time. So it's giving me life right now is knowing there'll be back. How's that? Most of them took off this morning. And so there's like a little void in my house. Quiet. It's a good, quiet, but it's still that void. So giving me life is the fact that they'll be back.

Lori 24:48

I liked that. I like that. And you know, they left with happy hearts. Like that's a good feeling, you know, your family left and everyone's still speaking. It's all good. It's all good. It's all good. And what about you, Lori ? You know, what's giving me life. This is gonna sound silly. So I have talked before on one of our podcasts, one of my dear friends who they have had a foster child in Honduras for she's now almost eight and my friend, they moved back to the States. They were missionaries over there for 10 years and she, because of Honduran law and a whole bunch of stuff. And now COVID, can't come. So Kumi, the little girl has been over there living with another family. So my friend got to Honduras finally, three weeks ago. I can't quite remember. We got her there and now the two of them are stuck, but the good news is they're together. She started homeschooling. They live in this little tiny bungalow COVID is really bad over there and they don't have equipment. So I have been, you know, the Marco polo app. Yeah . So Kumi little Kumi, joy. And I have been Marco poloing every evening. And we're reading Judy Moody is in a bad mood chapter book together. And it's just makes me so happy. Cause you know, my kids are grown, right . But this book is right up my alley. Right? Any it's about a girl that's starting third grade and she just is funny and Kumi will Marco polo me back the next day she calls me Miss Lorley. Mrs. Lorley. I love you. I love Judy Moody . And I just, it just, nothing fills my heart more and I cannot wait to read the next with her .

Vonda 26:44

That is so cool. Yeah. Those things . No, it doesn't that just life-giving for sure. It's fun .

Lori 26:51

And then her mother will WhatsApp me going. I cannot thank you enough. This gives her, you know, like here, go listen to ms . Lori's chapter so she can go to love that that's given me life right now.

Vonda 27:06

That's awesome. All right. Until next week we'll see you all next week.

Lori 27:10

All right . We have certainly enjoyed our time together today and we look forward to being with you guys again, if you have any questions, concerns, comments, anything we would love to hear from you. You can always email Laurie at flower, click.com. Also, if you enjoy our little podcast, go ahead and click that subscribe button. That's very helpful for us and you can even leave a review and we hope you join us next week. Yes. So please come back and join us and discover how a bit of knowledge and one small change in your mindset can take you to new levels in your life.

Speaker 2 28:48

[inaudible] .