How to Improve Subscription Retention

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Malomo Staff


The ecommerce industry has skyrocketed in the past few years. Having products delivered directly to your home has saved shoppers the time and effort involved with a trip to the store. With delivery speeds becoming so quick, more customers than ever are buying online.

But how do you keep customers coming back? One popular strategy is to upsell your customers into getting a subscription. While subscriptions are convenient for your brand, not every customer wants to immediately sign up for a subscription for a product they’ve never tried before.

In this in-depth guide to ecommerce subscriptions, learn how to grow a subscription business and the tools that will help you grow.

How to drive customer retention with subscriptions

Customer retention focuses on keeping current customers buying from your business. Essentially, you want your brand to become a go-to for customers when they need to make a purchase.

Subscription models rely on recurring revenue, so customer retention is even more important for merchants in the subscription space.

High customer retention rates result in:

  • Increased customer lifetime value (LTV)

  • Improved customer loyalty

  • Greater customer satisfaction

  • Higher average order values (AOV)

By keeping current customers happy, you’ll improve retention and even motivate customers to refer your products with their friends and family. Loyal customers will stick around and become a great marketing tool for your business.

Listening to customers is the secret to customer retention

Most customers want to be heard. While personalization tools that show customers exactly what they want at the right time is nice, it doesn't matter if customers feel like just another data point. How do you make customers feel “seen”?” You listen.

You should always collect customer feedback about your products and business. You can’t guess what customers are looking for. This shows customers that you want to make the experience the best it can be for them, building trust as you provide an unforgettable customer journey. Collect customer feedback and incorporate it into your business plan by identifying specific churn points.

While there is no magic formula to succeeding at improving customer retention rates, looking at your retention metrics and analytics is a great place to start. The customer onboarding experience is usually one of the best places to jump into first.

Typically, this is where you see the sharpest decline in customer fall off—during customer acquisition. The customer journey and overall experience are not only key for the initial checkout, but also in terms of customer retention.

Customer retention strategies that actually work

Another secret to better customer retention is a mix of the strategies below. You should experiment and see which strategies below keep your customer base interested and engaged.

Customer service

Want customers to be happy? Make sure they have a customer service experience that lets them know they can rely on your brand. We’ve all had bad experiences and likely haven’t returned to that business since. Small tweaks to your customer service offerings can mean big gains in customer retention metrics.

Communicate with customers where they are

Whether you’re sending emails or SMS messages, it’s crucial to create personalized content for your customers.

While email communication has been the tried and true method of communication for online retailers, they unfortunately get lost in the shuffle due to the sheer amount of emails customers receive on a daily basis.

But letting customers choose how they want to hear from your brand is a great way to improve retention. Once your customers have selected the way they prefer to communicate with you, you’ll want to make sure you’re delivering customized content where their purchasing behavior is utilized to feel unique.

Many brands are using SMS functionality to help increase engagement with their subscribers, and in doing so, are seeing up to 30% higher lifetime value. Personalization through communication reaches your target audience in ways that continue to encourage loyalty and retention.

A major factor in retention is flexibility. When existing customers have the option to skip a shipment, add items to their order, or further customize their subscription through transactional SMS, you can increase customer average lifetime value (LTV) by up to 30%.

Reach new and existing customers on their mobile devices, and you’ve unlocked one of the keys to increasing customer lifetime value and retention.

Get feedback from customers

Repeat customers can provide you with important feedback on how to improve the customer journey. Offering ways to give feedback or sending occasional surveys can help improve the experience for your new customers and build trust with existing customers.

Start a customer loyalty program

Loyalty programs are lauded for their ability to improve retention. By acquiring points on each purchase customers are motivated to make another purchase and continue spending more with your business. Brands with thriving loyalty programs often have high customer retention thanks to the community and feeling of belonging that they’ve built around their business.

Include subscription messaging in your marketing campaigns

In any marketing campaign, your conversion rate can quickly help measure the impact of your messaging and allow you to pivot as necessary to create campaigns that speak to your target audience. When marketing your offerings, be sure to include language that directly highlights the option to subscribe.

This can be paired with general messaging about your brand and products, or it can be a standalone message with a highly targeted group—perhaps those who have abandoned their carts.

Provide valuable information at every step of the customer journey

The buyer’s journey can sometimes be as straightforward as, “I heard about this product, and I would like to purchase it.” But most of the time, it’s a spaghetti model of multi-directional decisions your customers are making.

But there are cases where a customer wants to purchase from you, but they decide not to make a purchase at the last minute.

So how do you meet them where they are at every stage of the web of the customer journey? The key here is to provide them with content and information from start to finish, but not to present it in an entirely linear fashion.

Having content on your website that speaks to your customer base and educates them beyond your product is a great way to capture those at every stage of their journey. Whether they are totally unaware or have heard of your offerings before, you want to show up in their browsing history as a trusted source of information.

Create personalized retargeting campaigns

Web personalization for your own site is extremely important. But have you decided how you want to deliver personalized experiences in your retargeting campaigns?

For example, if a customer comes to your online store and browses a very specific set of products, do you have mechanisms in place to target them once they move off of your site to further engage them?

Creating personalized marketing campaigns is a tricky balance between being overly creepy and perfectly on the mark. Giving customers an offer that is directly tied to the options they were looking for is a great way to re-engage them and bring them back to your site.

Offer incentives

Any merchant looking to retain customers should take advantage of incentives. When you offer special discounts, free shipping, and other perks for your subscribers, customers will feel valued and encouraged to come back and purchase again. Incentives can also help you acquire new customers, and reward your most loyal customers. Here are a few more ideas for merchants looking to offer incentives for the first time:

  • Give subscribers early access to new products

  • Offer bonuses like free shipping or special discounts

  • Allow customers to give back to a meaningful cause related to your mission by making a donation with their purchase

Often, merchants will create memberships, where customers can pay for access to these types of exclusive benefits. Acting as another rung in the ladder of incentives, memberships are easy to introduce and give your customers access to your brand in a new and exciting way.

How to grow your subscription business

Want to know one secret way to improve your subscription business? Use Malomo & Recharge together to drive subscriptions during the post-purchase experience.

Recharge is the leading subscriptions management platform designed for merchants to set up and manage subscriptions for their customers. If you want to run a subscription business, Recharge is here to help.

Here's what you get with Malomo and Recharge:

  • Drive subscriptions during the post-purchase experience when your customers are most excited about your brand

  • Expose non-subscribers to your subscription plan(s) by differentiating order tracking experiences based on each customer's profile

  • Through segmentation, provide already subscribed customers with a different experience highlighting the most relevant content to your most loyal customers, such as exclusive perks, new product releases, and so much more

See how Malomo and Recharge work together in the video below. You can also subscribe to our podcast, Retention Chronicles, to learn how ecommerce founders are driving more revenue with subscriptions.

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