TL;DR? Checkout this short & sweet twitter thread.
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Insightful analytics that are driven by a deep understanding of customer behaviour can make or break your subscription business.
The right Subscription KPIs can become your north-star metrics and give you just the information you need to streamline operations, reduce churn and drive your subscription business's growth.
Here are 6 KPIs you can’t ignore if you run a subscription business:
Revenue stands as one of the most important KPI for DTC subscription brands.
With just 5 simple metrics, you can get a clear overview on how well your subscription business is performing revenue-wise.
These metrics show you an accurate picture of your revenue data.
One thing as important as retention is growth for DTC subscription brands.
If you’d like to see how your subscription business has grown over the last 30 days or 6 months then you can narrow down your data to this time period and find out important metrics like:
Data over a short period say 30 days helps you identify the health of your subscription business in recent times.
Quick Tip: Did you know that brands lose ~15% of the revenue just between skip and paused subscriptions even before the payment is attempted. This happens because of the Upcoming Order Reminder email.
A lot of opportunities exist in designing a very good upcoming order reminder email. Here’s what you can do:
The best part about running a subscription business is higher predictability - both for future revenue and upcoming inventory.
Inventory forecasting becomes all the more important then to make sure you don’t go out-of-stock and are shipping orders on time.
Loop gives you a neat inventory forecast data that shows how many units of specific products have to be shipped for the next 7/30/60 days respectively.
This ensures the best inventory management for subscription-first DTC brands.
Churn is arguably the most important metric for DTC brands. It’s a great KPI and can be easily tracked every month to understand your subscription business health.
Loop gives you monthly churn rates along with revenue lost each month due to this churn.
Tracking this over several months will help you realize how well you are retaining subscribers over the longer run.
Another useful KPI is a subjective understanding of your customer psyche and why they are cancelling.
If you have cancellation flows embedded in your exit survey, then Loop gives you a numerical dashboard view of what are the major reasons behind churn every month.
For instance in one month the highest number of cancellations might be attributed to “too much stock” while “too expensive to continue” might become a pain for most customers in another month.
You can easily read this data and keep a close check on the cancellation trends to take corrective action accordingly.
Another useful churn related KPI is Order-Wise Cancellations where you can specifically point out after how many orders does the cancellation takes place.
Does it happen right after the first order - if yes then you have a second order churn problem. Does it take place between 5-10 orders or more?
Usually the higher the number of orders before a cancellation happens, the better your LTV is. And shorter would be your payback period.
One thing that’s worse than churn is passive churn i.e. churn arising due to failed payments. To solve this you need a good dunning management system.
Loop helps you see how much revenue you are realising/failing every month - this serves as a indicator of how healthy your dunning management practices are.
If you have a great dunning system set-up where you’re timely reaching out to customers with SMS/Email to update their payment details, then you will see your failed revenue reduce month-on-month and vice-versa.
Another KPI to assess your payment failure subjectively is identifying the major and minor reasons behind payment failures. Loop gives you a clear overview of all the payment failure reasons every month - and which ones are becoming a major contributor to payment failure.
With over 300+ data points, Loop analytics gives you insightful data that is actionable and easy to understand.
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Emma Johnson is celebrated for her strategic brilliance and innovative flair. By seamlessly blending creativity with data-driven insights, she has propelled Loop’s brand to new heights, establishing it as a formidable force in the Shopify Subscriptions space.
TL;DR? Checkout this short & sweet twitter thread.
