Ecom Brands: This is WHY your subscribers cancel!

Transcript: 

Jared Ward: 0:08 Matt Holman. What's up, man 

 

Matthew Holman: Jared? How's it going? Buddy

 

Jared Ward: Good, this is Matt Holman. Everybody Ops unfiltered audience. He is the founder of Subscription Prescription, the founder of Commerce Catalyst. Most people in Utah know what Commerce Catalyst is. They in Utah know what Commerce Catalyst is. They've been at one of the Lunch and Learns or one of the events One of your big expos coming up this year Absolutely.

 

Matthew Holman: 0:31

September,

second time, yeah, september. What's the date again? September 10th, 10th,

okay, and where it's going to be? Downtown Salt Lake City.

 

Jared Ward: 0:37

Awesome.

Yeah, we went there last year. It was great. Who are some of the cool sponsors

and brands that we're going to see there? Oh, we're super pumped.

 

Matthew Holman: 0:45

Um. We just

confirmed our title sponsorship with Sendlane. Um. I'm a huge Jimmy Kim fan.

Just love the product, the community, the way he's marketing um his business

and helping like revolutionize like the email marketing um recharge, and then

we have quite a few others Um, so we're really excited, like Like. I feel like

we're, you know, kind of growing up in the space and people are starting to pay

attention. The whole thing, though, is about what's going on in Utah. Utah has

just an amazing ecosystem here for e-commerce, saas, which you're building and

what brands are building. So just really excited to like pull everybody

together and celebrate and learn and network together.

 

Jared Ward: 1:24

And I'm

excited to see what happens with Commerce Catalyst because, in general, utah is

such a hotbed for e-commerce and e-commerce enablement tech. It really is a

unique space and you're one of the only ones who's trying to. I mean, there's a

couple of players in the events and community space but I like what Commerce

Catalyst is doing. You're bringing together the technology providers and the

brands in a really cool way.

 

Matthew Holman: 1:50

Absolutely.

We've been sponsors of Commerce Catalyst for a while now, yeah, you guys have

been supporters from the beginning, so I always appreciate you, man.

 

Jared Ward: 1:57

So Matt's

also the co-founder of QPilot, which is a subscription software. It's a little

bit different than Recharge and some of the other competitors, but we'll dive

into that. Yeah, absolutely so. First thing I want to start out with, let's

dive into subscription prescription, and I've got some questions for anybody

who has a subscription model in their e-commerce business. What is subscription

prescription? Why did you start it?

 

Matthew Holman: 2:25

Yeah,

absolutely Like. Subscription prescription started so my partner at QPilot,

David Bradley, we were trying to figure out we were primarily a WooCommerce

plugin and our platform and we were looking at trying to get into Shopify. So

subscription prescription originally started as just like a newsletter to try

to acquire leads in the subscription space, so with the ultimate goal of

flipping them to Q pilot. That's. That was our initial premise. But what we

started to find was so many people were just starving to figure out

subscriptions. There's not a lot of content, there's not a lot of education,

there aren't like there are very few, or enterprise only um consultants. And so

what we found was like, wow, there's this big opportunity here where we might not

be able, and they weren't interested in flipping. They're like no, I'm on this

platform or this platform, or I just migrated to this platform, I don't want to

migrate again, I just want to get better at my own platform.

 

Jared Ward: 3:18

What do you

mean by figuring it out from an outsider's perspective, as somebody in the ERP

space who all I know is the brands that do subscriptions have more trouble with

inventory management, so I'm sure it's much deeper than that. Why?

 

Matthew Holman: 3:33

Well, think

about this when you sell a fulfillment system like, you're selling generally to

somebody who is an expert at their own fulfillment, and sometimes they're an

expert at fulfillment period, meaning they've done it at several companies and

stuff like that.

 

Matthew Holman: 3:46

Subscriptions

is a little bit less common, so you'll usually have somebody that only really

knows their own business or maybe they've run subscriptions at one other brand.

It's it's rare to run into people that, like blew up a subscription program, go

to another one, blow that up. You just don't see that happening very, very

often. So there's a there's just a lack of expertise and experience in the

space and there's not a lot of like, again, education resources, um, in, in

most apps or software platforms are the ones that are delivering that. So, like

the subscription, there's two subscription conferences in the entire country,

the entire country every year. There's two, subsummit, which is kind of

agnostic and very high level, which is in Dallas this year, and the other is

called ChargeX and that's hosted by Recharge. So if you're not on Recharge,

like, where do you go to like connect and learn with other people in the

subscription space? It's like it doesn't just hard to come by resources in that

way.

 

Jared Ward: 4:41

So it

sounds like Recharge sort of dominated the industry from the beginning, but

that's changed. There's so many different use cases that maybe Recharge can't

handle.

 

Matthew Holman: 4:51

Yeah,

definitely, and it's also a question of being a market maker, right? They

actually. I think what has happened is, since Recharge had, their pricing

structure initially was like they're charging a percentage of a processing fee,

so every time an order would process, they would be able to collect some money

off of that. So that's actually very profitable as far as apps go, because it's

instead of just charging a hundred bucks a month, you could potentially get to

several thousand or, for large brands, tens, 20 hundreds of thousands of

dollars in just software revenue from a really large brand that's running

subscriptions successfully. So that sparks other people developing different

products, coming after the problem a different way. So it's been really fun to

watch all these different apps go after it. Initially it was just like Recharge

and Bold, and now there's like there's 50 of them Breakdown.

 

Jared Ward: 5:42

I'm curious

about this Breakdown the subscription tech landscape for e-commerce. If I'm a

brand, say, I'm doing like $2 million a year. I just tried to spin off a

subscription model for my business. Who are the players that I'm going to be

looking at?

 

Matthew Holman: 5:55

Yeah, so

the top players in this space are still Recharge. Then, when you get into it,

it's like the next tier of, I think, of up and comers. It's like the next tier

of, I think, of up-and-comers Like Bold has been in the space for a long time,

but the apps that have been developing, I think, the most strongly within

subscriptions are Stay, ai, skio, loop, smarter. You've had Appstall is one

that's been around for a long time I didn't know Loop.

 

Jared Ward: 6:18

I thought

Loop was a return spot.

 

Matthew Holman: 6:19

Loop.

There's Loop Returns and Loop Subscriptions. They're two different companies,

oh, okay, oh, I didn't know that. So then you have Appstall and then you have a

few others, like Seal, that have been around actually for a while and have

pretty big subscriber bases.

 

Jared Ward: 6:33

No wonder

it's so confusing. So how does a brand navigate? How do I even know which one

to choose?

 

Matthew Holman: 6:38

Yeah, I

mean that's the hard part, and so one of the things that we do with our content

and so the kind of like coming back to this whole story of subscription

prescription is David and I are sitting there looking at this landscape

thinking like, wow, we should just try to try harder to be a resource for more

people.

 

Matthew Holman: 6:58

And so

David's my partner on subscription prescription still catalyst then on

consulting and trying to help people figure out subscriptions, because it's

it's kind of one of these weird things where I mean, imagine if you had to

figure out shipping and fulfillment or like how you manage your inventory and

your marketing team like, well, I guess that does happen, because if marketing

starts to sell out of a product and you don't have that inventory available, it

causes problems. But imagine that if you could get better at how you did

marketing, it would directly influence your ability to fulfill products. And

that's what happens with subscriptions is, everybody thinks it's all of

retentions and software is built for retention, but the hardest part about subscriptions

is acquiring subscribers, and so you have to be able to connect like this whole

big picture, and subscription app tech is only part of that problem.

 

Jared Ward: 7:46

That's

interesting, so it sounds like a big problem that people don't think about is

how their subscription platform connects with all of their other parts of their

inventory, their marketing, absolutely Customer acquisition.

 

Matthew Holman: 7:58

From a

technical side and then from, like, an information or person resource side. So,

if you think about it like, you'll have a typical e-commerce companies running

either with an agency or they have some in-house growth people. They're running

ads, they're trying to drive sales, they're trying to hit certain targets

around, like customer acquisition costs, things like that Right. And then you

have, and that generally will push people into subscriptions. Sometimes they'll

try to prioritize offers or not, but they're pushing people into the funnel.

And then on the other side of that, you have a fulfillment team on the

retention side. So, like your email marketers, crm managers, people like that

um e-commerce manager maybe who's like trying to manage the subscription,

health, retention, keep people on as long as possible. Those two things that

two, two like groups are often siloed from each other. Possible. Those two

things that two, two like groups are often siloed from each other.

 

Jared Ward: 8:48

The

information is not shared across the board, or what's a common? What's a common

tech stack that you see that silos information?

 

Matthew Holman: 8:53

It's really

just comes down to like, like, where you're getting your analytics. So, like,

if I'm looking, if I'm using recharge or skio or stare any of those that I

mentioned I only see analytics related to retention, my actual subscriber

platform right, the growth team is building out stuff in triple whale, right,

and you maybe you're using lifetime, lee or another like analytics app that's

trying to unify some of that information. But then you also have to go and

take, take a step further and go okay, how is the lifetime, projected lifetime

value of this cohort that my growth has just brought in and my retention team's

trying to help? How can I influence that? At the same time, and so it's

difficult, you have to unify data, which is a big problem for everybody in

every space ever, but on being able to make better decisions. But it's also

like how you set up projects, how you set up tests, campaigns you're running

what you're trying to prioritize All right, that makes sense.

 

Jared Ward: 9:43

Now you set

up tests campaigns. You're running what you're trying to prioritize All right,

that makes sense. Now, again, let's go back to our brand example. How would

you? What are the questions?

 

Matthew Holman: 9:57

that I

should ask myself as a brand to diagnose which software I even need to choose.

Yeah, so the biggest thing is like trying to start nailing down like prime use

cases for your customers and understanding your customer experience. So, in

general, a typical like if I'm selling pet food, for example, and that's it

people buy a bag of pet food or not. That's a pretty basic subscription

process. They pick the frequency they put in their payment, that's it. There's

nothing really technical there. From like that almost any app wouldn't be able

to solve. So it really, from at that point comes down to what do you like the

look of and how do you like the analytics for what your team wants to pay

attention to?

 

Jared Ward: 10:28

And then

getting referrals related to support, because every when you say the look of

you're talking about like the checkout experience like the design of the widget

and how the portal looks, that kind of thing. Sorry, random side tangent. Who

is there? Anybody that allows you to customize that experience, or does

everybody?

 

Matthew Holman: 10:44

You can.

But it's like the basic thing is like okay, what do I get out of the box?

Right? Like, yes, many brands are optimizing or customizing things, but maybe

they don't necessarily need to be, or there are a lot of them just aren't doing

it.

 

Jared Ward: 10:59

That's

interesting. Well, why, like? Where's an example where somebody thinks they

need to customize something, but in reality somebody thinks they need to

customize something, but but yeah, so a great, a great example is like Dr

Squatch.

 

Matthew Holman: 11:10

That's the

one I like to point out all the time because they have this amazing brand, all

these different products religious soaps, fragrance soaps they have again, if

you've ever want to see a great example of just like diverse product line, dr

Squatch, yeah so.

 

Matthew Holman: 11:22

But what's

makes really interesting is that they have they have one of the like go to um,

build a bundle subscription experiences in the space. So if you go to their

site and you want to say, like you're, you got sucked in by an ad for like

Jurassic park smelling soaps, which, yes, they have, um, you go in there and

you start putting together a bundle. You pick a certain number of soaps and

it's a step-by-step process and then periodically they'll interject an um, a

uh, upsell option and then they're trying to get you to subscribe to that and

check out. Now that build a bundle experience is fairly technical and a lot of

complications related to not just design but how you handle bundles and cart

restrictions around the amount you can put in there, stuff like that. So for a

team that's doing a million a month in revenue, or even if you're a $10 million

a year brand, that actually might be a little bit of an expensive undertaking.

If you're before that point, the question is always how will this actually impact

my business?

 

Jared Ward: 12:23

Yeah, why

optimize something that's brand new? You don't even know what you're trying to

optimize, Right right, right.

 

Matthew Holman: 12:27

So if you

think like, if the bottom line, though, is like, this is again one of these

questions around subscription philosophy is, if I'm asking like a brand that I

consult with, they are have an amazing retention, like amazing retention, but

their initial front end purchase experience for subscriptions is a little bit

hard to get into and figure out. So for them, it's like all about we need to

start investing in making that simpler and streamlining that smooth, because we

know when we get somebody on the subscription, we can keep them around for a

really long time. So it's those types of questions like is there bundling

involved? Am I doing prepaid? Am I doing gifts?

 

Matthew Holman: 13:00

Like all

these different elements. Like am I buying multiple items together or is it a

single SKU? How often do I upsell people into things? How often do people make

changes? Right, those types of questions related to a program is what you need

to be asking, because, again, if I have a subscription where it's one product

and I literally only sell one product, what do I care? If the portal has, like,

swapping features for other SKUs, at this point I don't need it, right, and

that is an oversimplification, because most people are selling more than one

SKU. But if I don't have a lot of people that are changing flavors, so if I'm

selling like doctors, it's like fragrant soaps, but most people buy only one

soap over one flavor or scent their entire life. Why do I need to engage in

like really fancy, like swapping features?

 

Jared Ward: 13:46

Yeah.

 

Matthew Holman: 13:46

Right,

unless maybe there's something, a churn reason that I've started to click and

that's ultimately what happens is people's leave software because there was a

bad support reason. Um, there's like a new hire. Um, or they're seeing a

feature on another platform that they think will be compelling for their

business and a lot of times it's not. Or the feet, the program, the platform

they left can actually do that, but there's been some difficulties like getting

through support or getting the right person, or you have to pay for it. That's

another thing. Like if you, if you're on like recharge and you want to get

custom something customized, you have to hire an agency or developer to

customize those things for you, whereas like maybe stay has built that feature

already or is willing to be build that feature to to win your business.

 

Matthew Holman: 14:30

Because

they're smaller, they're more nimble, like it's. It's a different. I mean,

you've deal with this right with enterprise level brands versus smaller

startups. Like you're more nimble, you're willing to take on more risk trying

to build stuff. As you know, you're building as the ship is sailing, as opposed

to Recharge, which is they're having their own set. They have a process around

their sales and their implementations and all those things. So it's a little

bit different, and if you're small you run into that and then you think, oh

well, maybe it's going to be easier if I go over here.

 

Jared Ward: 14:56

Okay, well,

walk me through QPilot. So who is a good fit for QPilot and what is the primary

difference between QPilot and Recharge?

 

Matthew Holman: 15:04

Yeah, I'd

say like the difference. So QPilot has integrations into Shopify and

WooCommerce. On Shopify, we're pretty much like, very similar to a lot of the

other apps. They're actually other apps might have better design functionality.

Qpilot, though, is very much especially on Shopify, like logistics and B2B

focused. So we have solutions around like shipping outcomes, delivery times,

things like that. If you're on WooCommerce, there isn't another, there isn't a

recharge on WooCommerce.

 

Jared Ward: 15:33

Give me an

example of shipping options and delivery times. When is that relevant?

 

Matthew Holman: 15:36

Yeah,

absolutely so. If you think about within subscriptions again, if you're

ordering soap, who cares when it shows up? Right Like, you get it when you get

it and it's fine and hopefully you're not living your life on the razor's edge

where you were going to run out of soap for one day, right, Okay, so um, but

that use case, while that is typically almost people thought of like

subscriptions, is starting to change and evolve. Where you know I might have

pet food, where I need to get a bag shipped sooner because my kids spilled a

bunch of water on the bag, or the real prime use case is around perishables,

fresh food, or how you're picking things up. So if you're getting a steak of

the month club and you're going to be out of town on a long weekend and you don't

know when your order is going to show up, then now that steak is sitting there

on your porch going bad and what does the customer do? They refuse it, return

it, complain to the brand and then that product is lost because it's

perishable, and so there are a lot of like use cases like that.

 

Matthew Holman: 16:35

The other

thing really does come down to like also like related to fulfillment how things

get bundled and kitted right. So like if a lot of brands or say they have a

starter kit where we're selling a bag of tea and a cup and a little swizzle

stick or something like that, um, the way we set up our bundles on our site is

that's just one SKU we didn't use like a bundle app and so that SKU goes onto

the subscription. How do we then pull out the tea, which continues on a

subscription, and leave the other things off? Or how do we then push that stuff

into fulfillment and those items get fulfilled in the correct way? There's a

lot of potentially logistic complications around how you're managing bundles

and things like that.

 

Jared Ward: 17:15

Got it, and

so that's where QPilot has carved out a little niche.

 

Matthew Holman: 17:18

Yeah,

qpilot's just built a little bit differently, in a unique way. And again, I

would highlight on WooCommerce is where our strongest differentiation is. On

Shopify there's some functionality that's similar to Recharge, but, yeah,

logistics, inventory management, some of those things were a little bit farther

along but where other apps I think do a lot better job. To be perfectly blunt

is on some of the design features, some of the portal functionality.

 

Matthew Holman: 17:45

Like

designing the intricate customer experience of yeah, like what, what the portal

looks like and the type of actions you can take and things like that, like

Klaviyo integration and stuff like that. We have a Klaviyo integration, but you

know there's some like stay and recharge, like recharge has been building with

Klaviyo for years. So they're like well, recharge has been building with

Klaviyo for years, so they're well advanced in that regard.

 

Jared Ward: 18:06

Interesting,

okay. I'm just genuinely curious. Where does Stay fall? What's their

speciality? Who do they attract the most?

 

Matthew Holman: 18:14

I think

Stay it's probably, I think a good way to. The way I think about it is that

Stay is started by Gina and Pearson, two like absolutely amazing like

marketers. Gina is a like retention marketer extraordinaire, so like she was

one of the co-founders of Lunar Solar Group and like, which is a big agency out

of New York and so, if you think about it, she's just been really great at

focusing on like what actually drives retention. So Klaviyo, integration being

really really strong, like looking at AB testing options or offers to surprise

and delight people to get them to renew their portal does really well. They

bought retention engine, I think about a year, year and a half ago, which is

like a e-commerce, like a cancellation engagement flow service and stuff. So

and then again, I think their team does a really great job of like marketing

what they do and trying to transform like a subscription experiences for brands.

 

Jared Ward: 19:10

What's?

What's been your experience now with subscription, prescription, Um, in other

words, yeah, going the route of education where you know you, frankly, you

might, you might lose. You could try to just jam everybody into QPilot, Um, but

you're really going the route of like, no, this market is big, Like we just

want to sell somebody who's a good fit, Um, what's been your experience?

Building that has helped QPilot ultimately, or?

 

Matthew Holman: 19:38

I mean it's

it helped. It's helped QPilot recently land a pretty decent-sized customer on

WooCommerce and I think for QPilot again talking about from a software

development standpoint you see a landscape and we saw so much opportunity and

still see so much opportunity in subscriptions, but Shopify has just become so

incredibly complex when it comes to trying to get your app in front of people.

 

Matthew Holman: 20:03

So for us

at QPilot, we're focusing on what we think we do best, which is like some B2B

and logistics features on Shopify and then WooCommerce. We're just doubling

down there because there's still a ton of brands on WooCommerce and there isn't

an app ecosystem in the same way that it exists on Shopify, where people are

building and iterating so fast and things are standardized Like. There's just a

lot of like ad hoc, like cobbled together solutions on WooCommerce, which is

why David started building there in the first place is he saw that product

opportunity? Um, so that's kind of like how we're focusing at. But so what's

interesting with subscription prescription is, as I've as I spend less time on

the marketing side of QPilot, I still help with partnerships Um, a lot of

subscription prescription is open doors into all these other apps, all these

other players understanding who they are, their software.

 

Matthew Holman: 20:49

Um, and and

again, trying to be like, trying to help people understand it, like for me I'm

I'm very much personally driven by education and empowerment and trying to like

help people do better, and so it for me, it's actually a lot more meaningful to

be on the subscription. So, instead of trying to sell software, I'm selling

like solutions and outcomes to help people do better in their business and

build better recurring revenue.

 

Matthew Holman: 21:10

So, it's

been really fun to do that.

 

Jared Ward: 21:12

I relate to

that a lot. As you know, with Luminous we try to go the route of I'm not going

to try to shove Luminous down your throat. If it's a good fit, then great. If

not, I'd love to just educate you from what we've learned about inventory

solutions.

 

Matthew Holman: 21:26

Yeah, and

we've talked to customers. We've talked to clients together before. I mean, I

love your approach on that. It's very much like trying to help people figure

out how to do this. Is there a better way to do this, or do you actually need

something different than?

 

Jared Ward: 21:37

that

Teaching them how to diagnose this, because they might. They might think that

they need this one feature, but they actually don't. It's just. It's actually

just a. They're not thinking about the problem correctly.

 

Matthew Holman: 21:46

Yeah, and

so I mean, I had an interesting experience that with a call very recently where

somebody was talking about related to cancellation flows and I won't get too

specific because it's something that they're doing and I don't necessarily want

to make them feel bad about this I told them this on the call. Don't

necessarily want to make them feel bad about this, I told them this on the

call. But the idea was is that they're worried about trying to make

cancellation a little bit harder so that people think about it longer, right,

which is a very typical response in most subscriptions. But the problem is, is

that approach you're focusing on the people that are kind of either at the

fringe or that are on their way out the door when you, whereas your focus with

subscription experiences should be on the people that are trying to stay. I

love that.

 

Matthew Holman: 22:21

How do you

enable better experiences for the people that like the product and just need

something fixed or to be better, or that you can market to them better, that

are already there as subscribers, and so it's very much a different focus,

right, you're like, okay, I'm worried about all these people. I don't want to

lose these people. Well, I have all these other subscribers I could sell more

to acquire more. Like them, figure out what they want, build what they want,

that kind of thing, and so that often is the mistake is trying to put the focus

in the wrong place.

 

Jared Ward: 22:49

It's an old

school way of thinking. It reminds me back when have you ever tried to like

these old companies like Comcast or Dish obviously still around, but like I

mean, go look at the customer reviews it all comes from, like cancellation fees

and how difficult it is to cancel. I totally agree Modern brands, whether it's

tech or consumer products, you should be focusing on an amazing experience.

 

Matthew Holman: 23:13

And if

somebody doesn't want it, great Well, that's what I love with, like some of

those players, is that they're trying to, like they're learning how to bundle

their stuff together. So it's like, hey, if you like Comcast, you get, like you

know, free six months of Netflix or something like that. So they're trying to

figure out how they can, like, try to get it, because they know that people use

they might have cable, but they're also still going to have streaming services,

right, like no, very few people don't. So, yeah, I that that should always be.

 

Matthew Holman: 23:38

Like the

subscription best practice is, like, my thing that I'm always harping on is

just trying to figure out what you can enable for your best subscribers,

because we all forget this happens in every aspect of business, and it's kind

of cheesy to quote the Pareto rule, right, where it's like 20% of your

customers are probably driving 80% of your revenue. Um, and it might even be

more like 10 and 90, I think, for a lot of brands. But the idea is you have a,

you have a segment of customers that are incredibly valuable to your business.

Are you building more for them or are you building something that will unlock

more value for them? So, like, sometimes, if you talk about loyalty, you wonder

are are loyalty points driving revenue for my business? Or is it just something

some people like to do and I give away product or discounts because of that? So

it's like that mentality of trying to figure out how can I get more money from

the people that like spending money with me.

 

Jared Ward: 24:32

I'm curious

these days, do you see how many businesses that you see are a pure subscription

play? That's it.

 

Matthew Holman: 24:40

I'd say

quite a few like. It's still, I'd say like the most common one, at least within

e-comm, is that you have people that have a subscribe and save option. So

they're selling pet food or protein powder or a beauty product and there's a

subscription option. Um, there's still plenty of subscription, like focus

businesses, whether, but they're typically like either subscription boxes,

yeah, or there are some brands that have grown just by promoting a subscription

only, like there's only you can only get the product through a subscription um,

do you think?

 

Jared Ward: 25:12

do you do

you believe that brands nowadays should expand their offering from, for

example, if you're just a pure subscription play, that's the only way to get

your product? Do you think they should be? Are they losing out on revenue?

 

Matthew Holman: 25:25

I mean,

it's a good question, but it's like again, like, based off of all these stuff,

stuff talking about whether you should be evaluating new software or not it's

like taking a step back. What, what is the demand from your existing customers,

right? So, like, do they want? Like, if you're selling coffee and you have a

really fun brand, maybe there's an opportunity for merch, right, and so that's

not, maybe how, what you, you didn't grow up thinking I'm going to start a

coffee brand to sell more t-shirts, but hey, my customers love our brand and we

have fun branding, so let's, let's offer merch for that, right? Or hey, we're

selling um coffee and a lot of people keep talking about, like indigestion, so

we're going to sell a probiotic. Like, maybe that normally wouldn't make sense,

but if you're getting customer feedback that, like, people would really like a,

say, mushroom based probiotic because you're selling mushroom coffee, so it is

really kind of like starting to like pay attention to what people want, like a,

uh, an endurance supplement that I love called X endurance. Um, it's a like a

supplement you take to help you like be stronger, faster on runs and CrossFit.

 

Matthew Holman: 26:28

They

launched a skincare brand. Oh, no way. Yeah, which totally seemed really weird,

and I bought it. Well, because it's one of those funny things as a buyer like

I'm super skeptical of skincare I see online and yet I, their product, their

supplement, is amazing. Like all those claims about stuff like this will make

you fat, like no, it really did so.

 

Matthew Holman: 26:52

When they

go, hey, we made a skincare, I'm like, oh well, I trust the brand enough I'm

going to try it, because normally I would say bullshit. But it's like, oh no,

you guys know what you're talking about. The interesting thing like

interviewing their team because they've been on my podcast is they talked about

they view skincare was actually just as a way to add more value to their

membership base. It wasn't so much to be a lead customer acquisition product.

They weren't going to turn into a new skincare competitor to all these other

skincare brands. But if you're a member inside X End endurance, they want to

just dump value on you from, like, gift cards and coupons to other brands that

are outdoor brands, like the dollar, cash back and stuff like that, and now

like skincare products and other things that they can just offer to their

discounts. Maybe they you know they make some profitability on it, but they're

able to drive more purchases from their membership segment of their customers.

Because of that.

 

Jared Ward: 27:43

Got it For

anybody listening who is. They're already selling their products on Shopify or

other channels. They're thinking about getting into the subscription game. What

advice would you have for them? When do you know to start a subscription side

of your business?

 

Matthew Holman: 28:00

Yeah, I

mean there's two ways to look at it Like. The first is if it's a replenishable

product or something that somebody is going to use fairly consistently, like I

mean, I've I've tried to talk mattress companies into selling sheet

subscriptions before, but this is years ago. Um, so you could potentially like

do something like that, but it's better if it's something that gets used on a

daily, weekly or maybe monthly basis. The other thing is like looking at your

repeat purchase rates is like if you're already getting a lot of people that

are coming back, um, a lot of the brand, like brands that are new to

subscriptions, are that I've worked with are are doing that because, like hey,

we've been getting requests from our customers that are asking for it. Like,

why don't you have a subscription option? I buy from you all the time, give me

a discount and I'll be on a subscription. So there's like that feedback and

looking at repurchase rates. If you're getting like higher than a 20% repeat

purchase rate on your site, like you should be looking at offering a

subscription.

 

Jared Ward: 28:49

I think so.

Personally. I see a lot of brands that get into subscriptions where they just

kind of half-ass it of half asset and because I think it's, it's attractive

from a number standpoint, especially like in in the days where we're

fundraising for e-commerce companies, they were getting crazy evaluations,

everybody was getting gobbled up. Subscription was so, it was so attractive

because like, oh wow, we have, we can, we can up our ltv like crazy and we can,

we can have true arr and we can get a multiple on that. And um, I, I think

there are a lot of brands who you know between like 2017 and 2021 ish, just

from my perspective, in that span they they spun off a subscription part of

their business and they didn't really focus on it. They weren't focused on

value, which seems to be the theme of everything you're talking about.

Everything should be focused on is this bringing my ideal customer value?

 

Matthew Holman: 29:42

Right. And

so, if we think about too like, I think there's a huge a problem that I've

seen, especially in the last two years, in subscription, I'm sorry within

e-commerce is that you know, brands put a ton of resources into growth,

naturally so they're trying to acquire customers and grow and hit new revenue

numbers and all that stuff. Naturally so they're trying to acquire customers

and grow and hit new revenue numbers and all that stuff, and so a lot of their

resources, headcount, dollar spent, all that stuff goes into acquisition. And

then subscriptions are often an afterthought. They're often managed by a

retention marketer who might be an email expert but that has very little actual

subscription experience, or an e-commerce manager who's managing like 50

different fires at any given time. When or where are they supposed to either

find the time to start testing and optimizing, like retention, or actually like

investing in it? Where, like, we're going to launch like a campaign

specifically for subscribers and things like that, but, yes, very much so in

this space. It's like almost like, hey, we're running this amazing marketing

campaign and we get about 20% of people that come in the door join our

subscription program. We have a couple of flows set up. We send them a gift at

month three and that's about it.

 

Matthew Holman: 30:46

And then we

wonder why it doesn't grow or why those like, if you're not looking at it from

a value like of like the lifetime contribution margin, like the profitability

on average for a customer, like, how are you making the right decisions on who

should be going after, like? I mean, the simplest little hack that I do across

like all the time is is is do you know which product is most popular on your

subscription, and not just count, but the length of time? I've, I've looked at

brands that have sell three products and they don't even know that product a

actually has a two times higher lifetime value than the other two products

because it lasts, on average on subscriptions twice as long. Interesting. But

then, when you see that, and then you see the front end of their website and

their sales funnel, they're not prioritizing product A at all, they're just

pushing it to the site or they're running on both things. They're not

differentiating, just pushing it to the site or they're running on both things,

they're not differentiating.

 

Matthew Holman: 31:44

And that's

where I was saying there's a silo is if I told a growth team hey, out of our

three products, product A is worth twice a customer's worth, twice as much. So

now your cost, your CAC cost to acquire customer actually we can afford to

double it for product A, like any growth team on the planet's going to just

salivate over that and just go hard and sell out of product A for you and

product B and C become an upsell or some other add-on that you can do.

 

Jared Ward: 32:06

How much

money are brands leaving on the table by not optimizing their subscription?

 

Matthew Holman: 32:11

Yeah, I

think it's all just a question of like. I think that for most it depends Some

brands I've seen like double or triple in size because of they, because they

took the a different approach that's what I think is so interesting about

subscription business models is like the stakes are so high, they're so to to

not optimizing your flow um, but in but in general, I'd say, even just spending

a few more hours um a week for any brand, you should be able to get 10, 20 or

30 percent like month over month growth on your subscription recurring revenue.

 

Matthew Holman: 32:43

Yeah.

 

Jared Ward: 32:45

Well, what

does your process look like with subscription prescription? I know you consult

for other clients. Who's a great fit for you to dive in and do a discovery call.

 

Matthew Holman: 32:56

Yeah, I do

stuff from whether you're starting out up to enterprise. My largest client is

200,000 subscriptions, so I've seen all kinds of different sizes. I think for

me, the clients that I do the best with are ones that are in the process of

growing and trying to figure out how to grow. Better isn't growing, or their

like you know, their customer acquisition side has gone stagnant. To say, well,

hey, I can improve retention by 10%, but it's not going to matter that much,

cause you don't have a lot of people coming in the door. So when there's a,

like, a growth team, or you're growing pretty quickly, or, um, you know,

there's some, maybe too many fires for you to manage, especially when it comes

to subscriptions, that's when I can be really lethal. So my whole process is

really like again, is and I've said it several times if somebody hasn't maybe

figured it out is I'm trying to unify the acquisition and the retention side.

So, like that example I just mentioned, it's easy to tell a brand hey, I'm

identifying products on retention that are worth more than others when people

buy those. We need to prioritize those in the purchase process, right? Or like,

hey, we need to change how we're managing upsells upfront, because it has a

direct impact on retention downstream, trying to increase user adoption. So a

lot of what I do is like starting very much like with buyer psychology, buyer

behavior of you know.

 

Matthew Holman: 34:12

A perfect

case in point is like, say, you're selling a device, maybe you're selling like

an electric nose hair trimmer. Like I don't think of anybody doing that, so

nobody can be mad at me for picking on them. So you're selling an electric nose

hair trimmer and so I can just tell you right now that something like that,

like it, doesn't necessarily get used every day. So if somebody buys one and

where they the subscription is like the replacement heads for like making sure

you clean, is how do you tell somebody, like to remind them that they need to

change that? Or how do you demonstrate the value of like of, of how they um,

why they need to be using that regularly?

 

Matthew Holman: 34:48

And a lot

of churn issues to devices or products come down to like people never used it

in the first place. They subscribe to something. It sat on their shelf for a

couple of months. They got a couple of replenishment things. They never used

1. So so too much product, which is a common issue in subscriptions, is

actually too much product Cause I never used it. So like if, instead of like

throwing a disc, a discount for that person is going to get you nothing.

 

Matthew Holman: 35:11

Right so

before we get into testing with like offering discounts, we should look at how

well a job we're doing at increasing adoption.

 

Jared Ward: 35:24

Are we

showing people how to use the nose hair trimmer are? We explaining the

importance of replacing the, the trimmers regularly, like all those things.

It's just a much deeper funnel, right like it's not just acquiring the

customer. It's what happens after that. Why didn't they use it? Why aren't they

coming back?

 

Matthew Holman: 35:32

I mean, I'm

sure you've seen that with luminous right how many times. Like if you onboard

somebody to new software and then you walk away and then six months later

you're shocked if they leave to go somewhere else because you never helped them

like make sure like it was implemented and being used correctly, like right

like you can't let that happen, right, exactly. And that's what's so

interesting is the subscriptions aren't often thought of that way and I think

maybe that's what's weird of coming from the sass side is I'm always thinking

about how do I get somebody to start using it right away?

 

Jared Ward: 35:59

How do I?

That's, that's your superpowers. You came from a SAS perspective which,

honestly, even when I think about subscriptions for consumer products, um, it

just seems like, oh, I just selling products, like actually no, it's like SAS,

it's like selling luminous, like it really is.

 

Matthew Holman: 36:16

Yeah, I

mean I think about like the examples. I love is, if you like a sleep app on

your phone and the onboarding or a dieting app.

 

Matthew Holman: 36:26

Yeah, or a

dieting app or a scheduling app. The onboarding for those apps is ridiculous.

It could take you 10, 20, maybe 30 minutes to answer all their questions and

configure all this stuff, and you're going to pay them $30 a month for the app

or something like that. But you're doing it because it could potentially change

your life. And when we look at DTC subscriptions, if you're selling like a

focus pill or a sleep aid or like a workout supplement, you actually have the

same opportunity to potentially change somebody's life. Yet how much are you

investing in information gathering, making sure you're personalizing it and

then making damn well sure that the product's being adopted and used in the

right way? And that, to me, is where a lot of my work is. Like hey, do people

even know how to do this? Your unboxing thing only talks about how cool your

brand is. It actually doesn't explain how to or the explanations like a QR code

somebody goes to. Why isn't that? The whole pamphlet in the initial shipment is

why how this works.

 

Jared Ward: 37:25

What are

the top things that you see the best subscription brands do?

 

Matthew Holman: 37:30

Yeah, I

think it comes down to engagement. I think the best subscription brands are

looking for ways to get feedback from people all the time, um, whether they

like something or not. Um, they're looking for ways to create some kind of

exclusive feeling, some kind of access, some kind of community right Like. A

great example would be Chewy as a subscription right Like probably have all

heard about, maybe these stories of like somebody's pet passes away, they go to

cancel their subscription, they tell Chewy, chewy buys them flowers and so it's

like this that that is an interesting touch point. But what ends up happening

is every other Chewy user, when they see that, just gets like a little bit of

pride and like feels a little bit more connected because they know that they're

like their product, their subscription company like cares about that Right,

yeah, so so I think like thinking about engagement in that way, like again

understanding, like what do people really want?

 

Matthew Holman: 38:22

Do people

want you to just give them something and leave them alone, or they want to make

it really easy to like, manage and make adjustments and changes? I think that

whenever you're looking at what the best apps do whether it's the dollar shave

clubs of the world, like a lot of these enterprise level that have been around

for a long time it is really really easy to manage. It is really really easy to

add other products or to try other things, and they're looking for ways to

either push you into a community or to try to get you to feel like you identify

with their brand in some way.

 

Jared Ward: 38:51

Okay, well,

I think this is a great segue into something else I want to talk about. Talk

about community building a community. Obviously, you've done this twice now, or

you are currently doing this twice, with subscription, prescription and

commerce catalyst. Um, you and I relate to this. We relate about this a lot.

Um, building a personal brand why? Why are you building subscription,

subscription prescription, why commerce catalysts? Why are you putting yourself

out there on Twitter with your podcast?

 

Matthew Holman: 39:19

Um yeah,

when I started trying to like figure out my professional career and stuff, I

felt like the people that I gravitated the most were personalities. Right, like

you know. I remember looking back and thinking, like you know, is there anybody

cooler on LinkedIn than Nick Staggy right, and seeing how active he was and he

would share and personal stuff, right Like Levi Lindsay, patrick Williams.

 

Jared Ward: 39:42

Lindsay Ivy

Scott Paul.

 

Matthew Holman: 39:44

Yeah, scott

Paul, before he got kicked off LinkedIn, right, like, like. So I've seen all

that and I think that, while I'm not I'm never going to be a sports influencer,

I'm not going to be like a any of those other things Like, I am trying to be a

personality or a force for good inside of, like connectivity and like education

and community, and so for me, like that's a big reason why I do it is that's

what motivates me and what I've seen work and and why I'm investing in it, and

I do think that long-term, that's the right business decision as well. It's not

about just paid ads. It's not just about, like, being a great blog writer. It's

about being a personality that people like want to show up for.

 

Jared Ward: 40:23

Did you?

You just got super nervous or insecure Like man what are people going? To think

about me. Am I, I do you feel like an idiot? I get, I get.

 

Matthew Holman: 40:35

I get

insecure all the time. It's it's generally more around like somebody isn't

returning an email or a call and I think, oh, they hate me now, like that. That

happens all the time and I have to just like tell myself that they're just as

busy as I am. I'm, I'm just on on red Like it's okay, or I need to, I need to,

I need to bug them a little bit just to remind them, kind of thing. But I think

it's more about half to the fact, like going into it, I'm always like, yeah,

this is a great idea. And then afterwards I'm like, oh, why did I do that? Or

why did I think, do with the personal branding? Is it's not like I?

 

Matthew Holman: 41:10

You know, I

make this joke that people run into me and they're like, oh, I've seen your

LinkedIn all the time, like you're doing amazing. I'm like, well, you have no

idea how much revenue that made for me. You know, you, you don't know how

that's actually impacted my business or not. Like you know, like two years ago,

like I, I would never like to think that I was like one of those fake it till

you make it guys. I wasn't posting pictures of me with a jet or any crap like

that. But but I was trying to create yeah, I'm trying to create content and be

helpful which people like and they appreciate. But how do you? How does that

translate into business? Right? So like the community stuff, initially I was

just trying to share marketing tips and stuff and it was started as a marketing

community. I didn't think it would end up with like a big annual conference and

like a Slack community with a thousand people in it. Like I didn't think it

would be that.

 

Jared Ward: 41:54

I think

what most people don't think about is that, or rather, when they start building

a personal brand, when they start posting online, they're thinking with.

They're thinking I'm going to build something and monetize them. It doesn't

necessarily work like that. Like you have to think like I'm going to bring

value and, like you said, build a community. You might not even know what

you're going to monetize in the future, but you're focused on value first and

um it's I say this to everybody trying to build a personal brand like you're

going to eat shit for a year.

 

Matthew Holman: 42:34

I'm still

eating shit Like a year or longer, like, like uh, you know, we mentioned Jimmy,

kim and Sendlane, like it's. So it's so easy to think that, like the last year

or two of Jimmy's content and how much pipeline it's driven and grown his

business, it's easy to think, oh, like Sunland's been around since 2022. It's

like no, sunland's been around since like 2017. Like, like, how many, how much

content. Like I, jimmy shared a video with me the other day of like an old

YouTube he made from like 10 years ago. He's like, yeah, I've been talking

about email for a really long time and so I think that's like, and to me,

that's where I try to keep that.

 

Matthew Holman: 43:11

At all

times I'm trying to remind myself yes, I'm trying to drive revenue for this

month.

 

Matthew Holman: 43:15

I'm trying

to like, sell another sponsorship or land another client, but I'm also know,

like long-term, oh, I'm getting doors opened here, this person's inviting me to

do this, or like, I'm asking to collaborate on that Long-term. I'm seeing like

the right signals go in that direction and for me, a lot of the work that I do

is I'm trying to create more content all the time, like I was, literally we

were talking, recording a video, um, course, in the same studio yesterday but

um, and that I'm going to sell. But I'm trying to figure out, like with other

content, how do I create content that maybe like get somebody to want to reach

out to me for help, instead of it just being all give, give, give? How do I

start peppering in the right content where I'm like, hey, by the way, I do

consulting or hey, by the way, this is a problem. I call out a lot. If you have

this problem, this is how I would fix it If were working together have you

heard?

 

Jared Ward: 44:08

um, jab,

jab, jab, right hook from, um, yeah, gary vanderchuk. Yeah, yeah, um, it's,

it's. Building a personal brand has been like one of the most interesting

things this this past year for me. Um, you feel like you're eating shit. You

feel like nobody's watching you because, I mean to be fair, like your youtube

videos are getting like 20 views right or seven or 60, and then every once in a

while you get a couple hundred. But what I always found interesting, I I

wasn't, I wasn't concerned about the business outcome. I just kept posting and

you just wake up one day and all of a sudden, all what we noticed at luminous

is everybody in utah in the e-commerce space, like they knew who we were right

and I was like wait, what's this is actually working, like people actually know

who we are and this is helping us close deals, like they're interacting with it.

 

Jared Ward: 45:07

Oh so,

like, of those 25 views, like one of those did really matter and well,

everybody thinks we're legit and it's. It's just interesting. You wake up one

day after just a year of being consistent, eating shit and iterating your

content and trying to optimize, and you find out like wow, like people actually

know who we are and people like like one of like I ran into like one of the

harman brothers here in Utah and he's like man.

 

Matthew Holman: 45:31

I love your

LinkedIn content.

 

Jared Ward: 45:32

I'm like

really Like, like like awesome, thank you.

 

Matthew Holman: 45:37

Like you

know, that happens. Like I think, yeah, it happens all the time and I think

that's the hard part is like figuring out that you know jab, jab, right, like

hook thing, like where, where, where, where, where's, yeah, where's the cadence

in for that? Um, and then you know I'm still working on like a lot of the work

that I do with my clients is like in some ways as proprietary, so it's not like

I can show everybody what we did, but I can maybe make some case studies, so so

that's. The other piece of the puzzle is like okay, how do I take successes and

share them in a way that my customer isn't going to care about but potential

customers will find like interesting and stuff? Cause you have to draw the line

between here's all the shit that was going on and what we fixed, and then what

happened, versus like oh, there was a 20% increase in this. Like you know

there's you need something a little bit more of substance in between.

 

Jared Ward: 46:24

What is the

platform most slept on?

 

Matthew Holman: 46:28

Like for

for what you know like social or subscriptions or b2b companies acquiring leads.

 

Jared Ward: 46:34

What, what,

what is the platform that companies sleep on most for acquiring b2b leads?

 

Matthew Holman: 46:39

inside

e-commerce. It's twitter. I'm not sure it gets slept on because I think

everybody knows d2c twitter is still pretty, pretty active that's funny,

because I I know you talked about like, yeah, yeah that was like the one plan

I've see.

 

Matthew Holman: 46:50

I've never

been a twitter person, so when you told me that and then I started poking my

head in twitter, I'm like damn, everybody is here on twitter like, but it's

very it's very much and one of the like peculiarities of well, maybe it's

everything I mean, I've been in e-commerce for long enough maybe I just feel

like it's it's unique in that way, but it's very much like a copycat space.

 

Matthew Holman: 47:11

It's very

much everybody's trying to figure out what everybody else is doing. Everybody

likes to argue about some of those things that are working or not. Like you

know, the joke is, like you know, make a comment around Facebook cost caps and

you'll get like this huge like diatribe of people going back and forth, ask

which subscription app is best, and you'll get all of DTC, all of DTC Twitter,

like coming out of the woodwork to like, comment or vote for who they like. So

it's fun. But, yeah, I have. I have a 10th, like I told you, I have a 10th of

the audience on Twitter than I do on LinkedIn and I get more business from

Twitter and and the and the best part is is Twitter.

 

Jared Ward: 48:04

It's so

easy to retweet. If I get somebody that has a bit of a thought leader in the

space, that tweets about something about me, common that people have a drive to

start community, especially in Utah, it's a really big thing. I don't know why,

but, yeah, um, people have this drive to start community. What is, what's the

number one piece of advice that you'd give them? How should, what is the one

thing they should do to just start?

 

Matthew Holman: 48:24

Yeah, I

think, like I'll tell you how we started again, I didn't think starting this

and I I've talked to other community founders Like it's very rare to like, and

the analogy I like to use is you, you want to build the next Tesla, but you

have no idea how complicated really a Tesla is and if you start building that,

you're going to end up with something else, because that's how life goes right.

Like you end up making a model for truck or, like you know, you make something

a little bit different. So with community, it's really just pull together

like-minded people and see if there are resources or problems you can solve

together. So our started as marketers unite.

 

Matthew Holman: 48:59

It was

literally because I had just joined Q pilot, small, small bootstrap company

solo marketer, and I wanted to meet regularly with other marketers because I

hate learning from blogs and YouTube videos on how to like build a landing

page. Like I already know all the crap that's on there. I want to know, I want

somebody very quickly to tell me no, don't use this or this or this. Go use

this. This is the best landing page builder and this is why I've used these

other five.

 

Matthew Holman: 49:25

Don't waste

your time For what you are asking me go do this and that's what our group was.

It was like four or five people having breakfast for a couple months and then

it was like seven or eight people having lunch for a little while and then

suddenly Patrick Wilms is like man, you should do like a like a lunch and learn

like a big thing and the rest is history, it's like. But again it's always

coming back to like people feel seen there, they're able to connect with people

there. The Slack group is like one of the most engaged and active Slack groups

like that I've ever been in is because people come in there to get problems

answered.

 

Jared Ward: 49:56

Yeah,

people can connect on their common problems that they're trying to solve and

it's great to get solutions from somebody who's already been through the

problem.

 

Matthew Holman: 50:05

And I've

been asked this a lot recently too, like how do I start a community and stuff,

and I do think that it's about like trying to bring some people together. I

don't think people appreciate how long it takes to get traction right. Like

marketers unite ran like for quite a long time with very little, and then we

were working with share house and then, um, you know, I had to. I blinked the

other day we're over like close to 950, like people on Slack, and the last time

I looked I thought it was 700. So so it. It just takes time. It's about showing

1. It's about being consistent over and over again. It's about getting

feedback. Um, that's, that's how you build community Just connecting with

people as much as possible.

 

Jared Ward: 50:42

Yeah,

people underestimate the consistency on content, on community building, on a

company, on products. Everything Just keep showing up. All right, well, I

appreciate all of the advice, all of the tips and tricks for subscription and

building an audience. Thanks, matt. Where can everybody find you? Where should

we follow you?

 

Matthew Holman: 51:04

Absolutely.

So you can go to my website is thesubscriptiondoccom? Got links to my

newsletter, podcast and stuff like that? Or just look for me on LinkedIn or

Twitter Matthew Holman subscription

doc. I'll come right up.

 

Jared Ward: 51:16

Okay, and

then the commerce catalyst summit that's coming up in September.

 

Matthew Holman: 51:19

Yeah, yep,

c C catalystco. I could have made the website a little more confusing, but uh,

yeah, or Google commerce catalyst Utah, um, and it'll come up as well.

 

Jared Ward: 51:28 Awesome. Yeah, we're

excited to attend that one.

 

Matthew Holman: 51:30

Absolutely.

 

Jared Ward: 51:31 Okay, thanks for

coming on, Matt.

 

Matthew Holman: 51:37 Thank you, man.