The #1 Way To Lower Subscription Box Churn


We all know churn is the silent killer of your business, but how do you stop it?

Many companies spend countless hours strategizing and executing on all kinds of churn strategies, all while ignoring the underlying issue.

The number one reason people will unsubscribe from your subscription box business is because of a problem with the product.

Think about it…

There are no win-back emails, UX Experiences, specialized cancellation processes, or monthly newsletters that are going to make up for a bad product.

The bottom line is that if the end-consumers do not feel that the value they receive from the product is greater than the dollar amount they pay for it, they will churn. End of story.

The good news is that you can always improve your product. The first step I’d recommend that you take is to collect customer feedback with a quarterly NPS Survey. Do this every quarter to see how your scores change over time. Also be sure to include a qualitative feedback question at the end that says something like, “How can we make {INSERT COMPANY NAME} better?” That way, you can hear what they like/dislike about your product in their own words.

That being said, sometimes your customers don’t know what they want until you give it to them. If you really want to create a great subscription product, follow these guidelines to point you in the right direction…

Basically, there are three things that every great subscription product has…

#1 - A Great Subscription Product Solves A Market Pain Point

This should go without saying. People have to like your product. It should solve a real problem in their lives. What problem does your product actually solve? Does it have inherent value in and of itself. I.e. - Would people buy your product if it were not in a subscription box?

Example: Shaker & Spoon delivers ingredients and instructions to make 12 signature cocktails each month. Each box includes all of the ingredients (other than the alcohol) for 12 cocktails (4 from each recipe). By using this service, Shaker & Spoon customers no longer have to buy massive quantities of cocktail mixers for drinks they would only like to try. Instead, they receive the perfect testing size quantities and can decide if they like a drink before committing to it. Not to mention it’s a ton of fun!

#2 - A Great Subscription Product Has A Strong Unique Selling Proposition

Why would people buy your subscription box product over your competitors? What makes it different? Remember, without a strong USP, you will be forced to compete on price alone. This strategy is rarely sustainable at scale.

Example: There are many sock subscription box companies out there that solve the market pain point of having to replenish socks on an ongoing basis, but only Southern Scholar Socks offers a high quality, stylish men's dress sock that utilizes 200-needle count knitting for superior fit and feel.

#3 - A Great Subscription Product Makes Sense To Back Into A Subscription Model

Too often, I see people throw a bunch of items into a box and hope it sells on a monthly basis, without considering the feasibility of the subscription model for their specific business.

There are a few things that make a product a good fit for the subscription model:


    • This saves the customer either time, money, or both. Using this strategy, you can seamlessly integrate your product into the end-consumer’s daily routine, making the likelihood of churn extremely low (as long as the economics make sense).

    • Example: Dollar Shave Club replaces the need for buying a new razor every month, while saving the customer money. Talk about a recipe for success.


    • This is why SAAS (software as a service) companies are so popular. Well designed SAAS products are usually built on subscription models and make the customer's day to day lives easier, as well as make it difficult to switch to a competitor without losing all of the data the customer has already plugged into the system.

    • Examples: Cratejoy, Recharge, Mailchimp, etc.


    • Creating some form of curriculum or series where people need to stay subscribed in order to complete it is a great way to combat lower churn.

    • Example: Hunt A Killer delivers an exciting murder mystery story that unfolds over the course of several months. Customers need to stay subscribed to complete the story.


    • Doing this automatically puts you into the space of establishing a strong Unique Selling Proposition. If you can come up with an innovative solution to an old problem, you instantly put yourself into a “Blue Ocean” where the competition is small and the opportunities are endless.

    • Example: Spotify or Netflix… Remember the days of having to carry CD’s around or downloading pirated music off of Limewire? How about going to BlockBuster and getting charged late fees? Both of these companies used streaming services to offer new, easier ways for consumers to access music and movies that they were already consuming anyway.


    • This saves the customer time and delivers a convenient way for them to try new products that they would otherwise have to search for each month. Be careful with this one… It's important to ensure that the need for a customer to be introduced to the new type of product that you're delivering on a monthly basis is strong enough to stay subscribed for months on end. Otherwise, you'll end up being a "one and done" subscription box where people churn out after the first month.

    • Example: Be Free Co introduces delicious dairy-free products to consumers with dairy allergies. This enables them to try new products every month and eliminates the need for them to read labels and worry if their foods are safe to eat.

If you can hit all three of these points, collect constant feedback from customers and make iterations based on that feedback, and still ensure your margins are high enough to support aggressive growth, you're on the road to subscription box success!


Steve KrakowerComment