Does Too Much Product Lead to Churn???
Ok… but why does too much product lead to churn?
The answer can be illustrated by the movie Matilda, which Rodeo’s founder Ben Fisher discusses in an episode of Subscription Radio.
In Matilda, the villain Miss Trunchbull feeds one of the children a slice of cake, which he initially enjoys. But then she forces him to eat more—slice after slice after slice, until the boy is so full he collapses.
Now imagine the boy is your consumer, and the cake is the product in your subscription service.
The consumer might love your product, but if they can’t use what you shipped them fast enough, then you risk inundating them with too much. Eventually, they cut off the subscription entirely just to stop the flow.
This is the same thing that happened to Jake Cohen, VP of Content for Klaviyo. He shares the moment he decided to unsubscribe.
“I was annoyed I was paying so much to acquire inventory that I couldn’t consume fast enough. Then I got another package. I went to put it away and saw a full, unopened package in the cabinet. I got pissed, then forgot about it. Until I got a notification about another upcoming shipment. Then I cancelled.”
The situation had apparently gotten so bad that Jake actually felt relief when he finally unsubscribed.
When a customer is happy to not get your product anymore, then it’s a pretty clear sign you need to make some adjustments.
What effect does this have on the business?
It reduces future profits
This is the first and most tangible effect of sending too much stuff. Overwhelmed consumers will unsubscribe. Not because they want to, but because they’re forced to. These are people who would’ve happily kept paying their monthly fees had they not been buried in product. That’s a hell of an opportunity cost.
Yes, the customer will likely keep buying your product a la carte (assuming they like it), but that doesn’t make up for losing a stable source of recurring revenue. And what if the customer was given enough product to last them months? It would be ages before you saw them at checkout again. That’s revenue you have to recover elsewhere.
That’s exactly what happened with marketer Isabeau Boody.
“The first month or so where I got duplicates of products I wasn’t finished with seemed fine; it never hurts to have a spare,” says Isabeau. “When I started to have 2-3 of one product was when I realized the subscription wasn’t sustainable purely from a volume perspective. I will continue to use all the products, just at a much slower pace than their current subscriptions allow for.”
It creates waste
“One of the problems with subscriptions is that it leads to a lot of waste,” says Ben Fisher. “It leads to a lot of products that need to be returned… and what ultimately ends up happening is that the product is not used.”
This is less of a problem with non-perishable items like razors or soap, but that product is still going to be in storage for a very long time while the customer uses up their current supply. This increases the risk that the customer will disengage from your brand by the time they finally need a refill, or they may get frustrated at all the product cluttering their home and get rid of the surplus entirely.
Jane Knickerbocker, a marketing strategist from Washington, DC, experienced this with pet food.
“We had ended up with a LOT more food than we needed, and I could just see this getting worse! It was a combination of not wanting to store 2 - 3 months worth of pet food at a time, and not wanting to pay for a month’s food when we already had 2 -3 months in hand.”
It even got to the point where Jane was having to rearrange her kitchen appliances to squeeze in more cat food. “It felt like the start of a lifetime movie about hoarding,” she quipped.
Jane went on to further discuss her contradictory relationship with the subscription. “I love the brand—and so does my picky cat! But it’s just not worth saving a dollar or so on auto-ship when I end up buying food they won’t eat for a month or so.”
It hurts the relationship with the consumer
The consumer’s frustration will build up with every new shipment. And who’s going to be the target of all this negative emotion?
According to one consumer who wished to remain anonymous, “So many companies are obsessed with numbers, subscribers,etc. They lock people in or take advantage of them being too busy to go through the methods of canceling.”
“I sit down every 6 months and go through my subscriptions. For one face cleanser brand, I tried it but didn't like it. Cancelled 3 times and had to dig through FAQ/customer service emails.”
“At first it just wasn't for me—but now I hate them.”
When asked what would get her to think positively about a subscription service, she said, “I would respect companies more if they took a more realistic approach to helping customers, rather than spending all of their time shoving it in your face and then hiding the exit.”
What can you do to reduce subscriber churn?
I’ll let you in on a little secret.
Customers aren’t really frustrated because they’re getting too much of your product.
They’re getting frustrated because they don’t have the freedom to choose how much they get or when.
Nearly every person we interviewed cancelled because they weren’t able to control the flow of product, and would not have done so had that option been available to them.
Besides which, empowering the customer is very good for business. Matthew Holman, Head of Growth for QPilot and creator for Marketers Unite, shared in a LinkedIn article the results of a study he performed. “Our data shows that any change a customer makes (including updating the schedule) results in $65 higher LTV. That's a lot.”
So you aren’t losing money by giving subscribers the option to order less—you’re actually earning more.
Here are some ideas for giving control back to your customers:
Different consumers can consume the same product at different rates, which means “a month’s worth of product” isn’t going to be right for everybody.
Try letting your consumers select the cadence of their subscription whenever possible. Ben Fisher made a bold suggestion in a podcast episode with regards to subscription bundles. “One of the things we’ve designed is line items having individual cadences,” Ben explains.
The consumer would select the item that they want and determine the schedule it arrives. This allows for a great deal of customer control and flexibility, and improves customer satisfaction.
If the shipping dates can’t easily be shifted, however, let customers tweak the quantity of the products they receive instead.
As empowering as frequency adjustment is, sometimes it’s not practical for the customer.
According to consumer Ashley Haynes, “I definitely had the option to adjust how frequently I get refills, but I would only remember when a new pack showed up. And by that point, I would have needed to change it to once a year.”
Ashley needed a different option—one she didn’t have. “What was a bummer was that the company website didn’t seem to have an option to pause your subscription. You could change time intervals, but I wanted to pause until I was caught up. Since that wasn’t an option, I canceled. And I’m still not out of refill blades.”
The pause button may seem undesirable to brands because it could be seen as sort of a “soft cancel,” but really it’s giving your customer some breathing room before you start things up again. If you force them to end their subscription entirely, then there’s no coming back from that.
As flattering as it would be, consumers aren’t sitting by their doorsteps, counting the days until you send them something. They’re busy with other things, and so occasionally lose track of what they’ve subscribed to until it arrives.
This means that they also tend to lose track of things they need to do prior to their next shipment, whether that’s altering the shipping cadence or using up the last bit of leftover product.
Delivery reminders can provide great customer experience by keeping them well-informed. It’s not overcommunicating—rather, it’s giving your customer a heads-up and offering them the chance to make last-minute changes if they need it.
Jane Knickerbocker agrees. “I would have loved an automated reminder before each delivery to give me the chance to check supply levels and then go and change/skip.”
It is possible to get too much of a good thing, and you don’t want that to happen to your consumers.
So give them an option to easily manage their own subscriptions with Rodeo’s Just-In Time subscription. We want your consumers to always be excited when your package lands on their doorstep, so Rodeo has the features that gives consumers the flexibility and convenience to pick the best delivery time for them.
They can choose the date they want their product from their dashboard or respond to the automated SMS reminder.
By offering consumers the flexibility to choose what they get, how much, and when they get it, you’re giving them the freedom to engage with your subscription service on their own terms. They’re more likely to find an arrangement that fits their needs which means less churn.
Now isn’t that worth giving up a little control?