The 3 top tips to improve customer retention in subscription ecommerce

by Alina Mudarisova | March 31, 2021


The 3 top tips to improve customer retention in subscriptionecommerce

Over the last decade, subscription services have gone from unicorns to mustangs. They exist everywhere for every reason. But how can you retain customers in such a crowded landscape?

Alina Mudarisova


It’s been a long time since subscription-based services were a rarity. In its bi-annual Subscription Economy Index(SEI) report, Zuora revealed that there was a 437% increase in subscription-based revenue growth since Q1 2012.

That’s a lot of growth.

But while more people — and brands — are looking into subscription services, many don’t consider the most important thing: customer retention.

Sure, attracting new subscribers is your #1 goal, but keeping their custom is a lot harder. On the flip side, you’ll see a much bigger payoff down the line.

So, how, exactly, do you keep existing subscribers? And why is it so important?

Customer retention is key

When scaling a business, it’s easy to prioritise new leads — especially if you’re going global.

We all know businesses need new customers to increase their ROI. But focussing too much on them while neglecting existing ones can cost them you the long run.

The thing is, research proves your top 10% of customers are likely to spend 3x more on their orders than new customers. So, keep them in mind.

For a successful subscription service, prioritising customer lifetime value (LTV) is essential. As turnover and profit depend on customer satisfaction, LTV is the secret to subscription success.

But how do you focus on retaining customers with so much competition?

1. Customer Engagement

When you kickstart your subscription businesses, it’s simpler to target new people.

Speaking directly to them via marketing makes them feel seen and heard. In turn, they’ll sign up for your service to check it out.

Many subscription services focus on new subscribers. But customer engagement should be a lifetime thing. You should foster them throughout, proving they’re as worthy to you are you are them.

Social media is one of the best ways to engage with your existing and prospective consumer base. By opening a channel for direct communication, they’ll feel seen and heard.

You can implement surveys, polls, and kickstart creative twitter threads for people to get involved in. All the while, you’re building up engagement while also passively reaching their followers.

2. Customer Experience

As the adage goes, treat people like you want to be treated. The same is true in customer experience.

In a study on customer experience trends, our tech partners, Zendesk, found that 75% of customers will spend more on a company that has good CX.

Customer experience is the one marketing aspect that has been around since the beginning. It’s just been used differently and is now the most important thing to consider.

These days, people want to know you care about them specifically. And that’s as true for brands as it is in real life. With care comes business — with both comes loyalty.

3. Customer Loyalty

Loyalty is the crème-de-la-crème of anything that matters in the world. Friendship, love, and even subscriptions.

A lot of brands are onboarding focused. They offer new subscribers discounts and trials while ignoring existing customers. But in doing so, they lose existing customers’ loyalty.

What you want to do is offer benefits throughout the customer journey. If you prove you care about people already on your side, they’ll stay on it. Loyally.

Don’t neglect existing customers for the shiny and new

Gartner Inc estimates that 80% of your future revenue will come from 20% of existing customers. It also costs 5x more to attract new customersthan to retain them.

With that in mind, it makes sense to put your current subscribers at the top of your list. Because if there’s one thing a crowded marketplace lacks, it’s connectivity.

Being that one subscription service people know they can count on is priceless.

Basically, customer retention sounds a lot more complex than it is. All you need to do is implement these tips in your CX strategy and you’ll show you care.

Alina Mudarisova