Optimizing Subscriptions for Flexibility and Engagement with Smartrr’s Gaby Yitzhaek Tegen
There’s a subscription for everything—frozen coffee, keto cereal, probiotic soda, bio-retinol night cream, and everything in between.
DTC brands are making big bets on subscriptions as a growth lever. Cofounded by Gaby Yitzhaek Tegen, Smartrr is a no-code solution that allows merchants to offer curated subscriptions and memberships. Used by Spritz Society, Remi, Aura Bora, and Unreal Snacks, Smartrr makes subscriptions as easy and manageable as possible while ensuring that they’re a healthy part of every brand’s business.
We sat down with Gaby to chat about the most common pitfalls DTC brands make with subscriptions and how they can best optimize them for future growth.
“Brands are becoming more thoughtful about the execution of subscriptions. Overall, we’re seeing a healthier relationship between the brand and consumer moving forward.”
Engaging Subscribers from Day One
Compared to Smartrr, other subscription platforms are expensive, way too challenging to set up, and lack flexibility.
Smartrr is a super light setup. The platform itself is extremely agile, allowing brands to easily change their promotions and subscription models. Plus, with Smartrr, brands can reduce the number of customer support tickets.
One Smartrr brand said that after switching over to Smartrr, their CS tickets went down by 70%. That’s 70% more time that their CS team can spend on managing larger projects and solving bigger problems.
Smartrr helps brands answer key questions, such as:
- How do we engage the subscriber throughout the entire customer lifecycle?
- How do we incorporate rewards into subscriptions?
- How do we encourage subscribers to gift and refer the product?
Subscriptions aren’t just about the initial point of sale. They’re about building a strong level of engagement.
Engagement could look like the customer receiving an email three days prior to an order arriving that says, “Hey, your order is coming in three days. Would you like to modify your subscription?” Or, it could look like providing the customer with the option to gift a subscription to a family member or friend or even skip the order completely.
Smartrr enables all that.
“The number one piece of feedback we hear from brands is that they’re frustrated by the number of customer support tickets their team receives. With Smartrr, they are finding that number reduces significantly.”
Smartrr Data, Smartrr Analytics
In that initial conversation with brands, Gaby says time and time again, DTC brands emphasize their focus on CAC and conversion. Although Smartrr improves both, the Smartrr team believes that it’s way more interesting to look at the long-term success of the customer, specifically honing in on LTV.
Using Smartrr's analytics, brands are able to better understand how their customers are engaging with their subscription business.
If there’s a significant drop in retention for subscriptions, Smartrr can pinpoint that drop to a specific product release, and from there, they can brainstorm solutions to either re-engage those customers or help the brand pivot.
Smartrr’s focus on agility allows brands the flexibility to make changes to their subscription offering based on their consumers actions and responses. It’s important to see what products are successful from a subscription vs. one-time purchase standpoint.With Smartrr, brands can enable subscription portal add-ons and can easily select which products are available as subscriptions, one-time add-ons, or both.
Not all products should be available for subscriptions. There should be a clear distinction.
The final piece: There’s always going to be churn. Instead of avoiding it in conversations, Gaby suggests leaning into the data to make smarter decisions.
With Smartrr insights (a new component of their platform where Smartrr makes recommendations), brands are no longer just aware of the numbers. Their numbers become actionable.
“Our focus on analytics is all about helping brands measure the long-term success of their business.”
To optimize subscriptions—and specifically subscription frequency—Smartrr looks at retention defined by cohorts.
If retention is strongest at a month frequency rather than a two week frequency, that’s an objective way to make a decision about what frequency is best. But, brands should also factor in the agility component—the option to be even more custom with subscription offerings.
Several Smartrr customers offer arbitrary delivery frequencies, but then on the backend (on the Smartrr Account Portal), consumers can go in and find a whole slew of additional offerings. Post-sale, they can change their subscription frequency—from weekly to quarterly for example.
With this feature, brands can A/B test and gain insight into the consumers’ mindset.
For example, a floral company might think that customers want bouquet deliveries on a monthly basis. But, it might turn out that they have big fans who want weekly subscriptions instead. Then, the brand can fix that on the backend in the Smartrr Vendor Portal.
Consumers are more and more comfortable buying items online. Now, they might purchase a12-pack rather than Trader Joe’s sparkling water.
Gaby says that subscriptions aren’t going anywhere. In fact, they’ll continue to grow as the tools become smarter and smarter.
“Smartrr’s flexibility allows brands to understand what’s working and what’s not working. Brands can be smarter, make better business decisions, and give their subscribers a better, more flexible experience.”
At this point, subscriptions are applied with the same stroke to every brand—a monthly subscription with 10% off. That’s the first mistake brands make. Beyond that, Gaby shared three common pitfalls she sees when brands set up subscriptions.
Charging for Shipping
Brands lean on higher discounting but then charge for shipping. Gaby suggests offering free shipping for subscriptions. “Giving too harsh of a discount actually devalues the product,” she says.
Agility is important, but sometimes brands make way too many changes to their subscription offerings. In order to see results, brands have to maintain consistent pricing.
Lack of Engagement
There’s a misconception that brands turn on subscriptions and then get thousands of lifelong subscribers overnight. That’s not the case.
Brands have to constantly engage their consumer. That requires communicating the value in subscriptions, sharing exciting product and company updates, and engaging the brand’s existing customer base. Plus, it includes providing additional perks for subscribers—exclusive drops, special gift bundles, and additional discounts.
Most brands are afraid to interact with the consumer. They’re afraid consumers will unsubscribe from their product. In reality, someone who’s likely to unsubscribe probably isn’t the brand’s core customer.
Gaby and her team ensure that brands don’t just sell subscriptions and then never interact with the consumer. They recommend reaching out to customers ahead of product releases and promotions, letting them know their shipment is upcoming and they have the opportunity to modify it.
“The traditional model of handling subscriptions is subscribe and forget. That’s what Smartrr is trying to redefine.”
- What to pledge
- How to improve
- Which tools will set you up for success
I think the most important thing brands can do in 2023 is to better manage their customer data—both ethically and effectively. There’s an opportunity for brands to know their customers better than ever before—a clear benefit for both the customer and the brand. When you manage your data correctly, you’ll create stronger and more personalized ads, creative, site experiences, and so much more.
This is a classic: Let the data guide you. Go where the buyers for your products are and communicate with them on a personal level (i.e. by persona and funnel position) and nurture those relationships (past, present, and future customers). It’s possible—all through data.
We recommend that Shopify brands analyze and update their websites using data-driven decisions. Using analytics tools such as heatmaps and scrollmaps can help brands better understand how customers are interacting with their store.
Store owners tend to make assumptions about the way customers interact with their website. Most never go back and analyze their design choices to find pain points or areas of opportunity. By using heatmaps and scrollmaps, they can see where real customers are clicking and concentrating their attention. Leveraging this data, brands can start to iterate on design and make their online store experience streamlined and intuitive.
Hotjar provides a simple way to implement heatmaps, scrollmaps, and recorded user sessions on your site, helping you acquire incredibly informative user data. Additionally, it gives you the ability to create on-site surveys, which allows you to obtain direct and often critical feedback from users about their experience.
Test various attribution models and analyze the impact on your business. At Fifty Six, we are always here to help our clients identify and optimize their approach—a critical step in any successful marketing strategy.
If I’ve said it once, I’ve said it a million times–Customer Lifetime Value. And even more importantly, Future Lifetime Value (FLTV). With the ever-growing importance of first-party data, it is crucial that brands take a good look at their CRM and FLTV metrics.
Stop allocating budgets to low-hanging fruit that doesn’t move the needle on conversion. Think about what’s really going to improve your CX and the return of undertaking different initiatives—not just on what’s top on your list of bugbears on the site!
One of the best ways to understand your customer behavior is by using HotJar. Their heat-mapping and screen recording tools shine a light on where customers are navigating to and from on your site, where they're rage clicking and experiencing frustration, and where conversion is dropping off within real life customer journeys and flows!
Understanding your customers’ pain points via data and analytics , will allow you to work with your CRO/CX Agency to solve customer frustrations and improve conversion.
Rewind backs up all product, customer, and order data for Shopify sites—essential since Shopify itself doesn’t provide this solution. It's saved so many of our clients time and money from administrative accidents.
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33% of customer service inquiries are pre-sale questions. What does this mean? If you’re not investing in customer service, you’re missing out on revenue-generating opportunities.
The benefits of elevating your customer experience:
- 10% to 25% increase in AOV for customers who engage with live chat pre-purchase
- 21x higher conversion rate for customers who reach out via Live Chat or SMS compared to other site visitors
- 87% of customers who have a great customer experience will make another purchase
- 72% of customers share positive experiences with 6 or more individuals
Gorgias is our favorite Helpdesk platform. They can reduce costs by 35%, primarily by decreasing the average ticket handle time. Their machine learning algorithms are trained on millions of ecommerce-related interactions across Gorgias’ customer base and provide accurate, automated replies for the most common ecommerce inquiries. This helps our agents resolve tickets faster, which provides the customer a seamless experience.
Trust your agency! Agencies do the same things across multiple brands and niches, so we see the trends and have the practice and experience!
Don't be afraid of data and insights. If customers aren't clicking on your emails, try a new CTA. If your ads are driving good metrics at a small spend, start scaling. If your customers are complaining about a product, look into QA! If the data tells you something isn't working, let it go and try something else!
I'm supposed to say Tydo, right? 😉
Double down on differentiation. There will be a lot of headwinds this year and standing out from the crowd will set you apart.
A picture is worth 1,000 words. A video? Probably millions. In ecommerce that value translates into engagement, acquisition, and retention—everything you need to impact your bottom line.
At soona, we've seen the we've seen the impact of creative and the continuous split testing of it yield results. Our resolution is to challenge ourselves and double down on innovation and creative optionality so that each brand we work with can distinguish themselves in a crowded sea of D2C ecomm. We'd love to see our brands share this resolution and keep pushing the creative limits.
Klaviyo. We're using it to power our email and newsletter at soona too!
Optimize your returns strategy! This can lead to valuable customer insights, enhanced user experiences, and increased revenue and customer loyalty.
Brands need to dive deeper into understanding their customers to set themselves up for success. Conduct research to gain insights into customer needs, preferences, and behaviors. By doing so, you can develop targeted strategies that will enhance customer experience and boost overall retention.
Right now I would say Gorgias. Having a good customer service tool is crucial to building strong customer relationships.
Start paying heavy attention to data, specifically around retention. We see a lot of effort put towards acquisition with the assumption that once someone buys, they are your customer forever. Instead, get to know your customer, understand their needs, and analyze their behaviors once they are on-site and judge their sentiment after they have visited. Work with a retention focused and data-driven agency to implement tools that contribute to repeat business and customer delight. It will pay dividends.
When surveyed, about 80% of ecommerce merchants think that they are delivering a great experience to their customers. However, when the same customers are surveyed, only 8% of those customers think that they are getting a great experience from the merchant. Now, more than ever, retaining loyal customers is an essential part of any online business and you should spend time with your customers to judge their experience with your website and products and offer improvements based on that feedback.
Tydo's report cards are an essential tool, along with Klaviyo for email and SMS, Recharge for subscriptions and memberships, Okendo for reviews and surveys, Rebuy for AI driven collections and upsells, Loop for self service returns... each tool is great on their own, but their strength as the ultimate tool comes from when they are used together!
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