Chase Alderton, Partner Marketing Manager at Recharge Payments https://getrecharge.com/blog/author/rechargepay/ Recharge is the leading subscription platform powering smarter subscription experiences. Thu, 21 Jul 2022 13:01:52 +0000 en-US hourly 1 https://wordpress.org/?v=6.6.1 https://getrecharge.com/wp-content/uploads/2021/07/favicon-150x150.png Chase Alderton, Partner Marketing Manager at Recharge Payments https://getrecharge.com/blog/author/rechargepay/ 32 32 Three winning ecommerce shipping tactics for Shopify & Recharge merchants https://getrecharge.com/blog/three-winning-ecommerce-shipping-tactics-for-shopify-recharge-merchants/ Fri, 22 Jul 2022 14:00:00 +0000 https://rechargepayments.com/?p=16058 For ecommerce businesses, it’s crucial to have a unified customer experience. When onboarding is intuitive but navigating the shopper portal isn’t, customers notice. When support is responsive and helpful but refunds are challenging to navigate, customers notice. When the checkout experience is seamless but shipping is confusing, customers notice. For physical ecommerce businesses, shipping is

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For ecommerce businesses, it’s crucial to have a unified customer experience. When onboarding is intuitive but navigating the shopper portal isn’t, customers notice. When support is responsive and helpful but refunds are challenging to navigate, customers notice. When the checkout experience is seamless but shipping is confusing, customers notice.

For physical ecommerce businesses, shipping is critical to get right to ensure customers receive the products they want on the timeline—and at the price—that they expect. To win your customers over, your shipping must align with your overall customer experience so your shoppers have positive experiences with your brand. For Shopify businesses, shipping rates are determined in Shopify but other subscription checkout functionality is controlled in Recharge.

We brought in experts Chelsea Jones and Rachel Saul from industry-leading agency Chelsea & Rachel Co. to ensure your shipping setup runs smoothly. Read on to explore their insights on how to avoid common shipping pitfalls and create the best customer shipping experience possible.

Key takeaways

  • Shipping is a crucial part of your overall customer experience.
  • To keep your customers with your business, your shipping experience should be intuitive and clearly communicated.
  • For merchants with the Shopify Checkout Integration, shipping profiles are a key part of your overall DTC strategy.

Three common shipping pitfalls & how to avoid them

ISSUE #1: Setting discrepancies between first & subsequent shipments

For merchants using the Shopify Checkout Integration, your customers’ first transaction will pull in shipping settings from Shopify. Each subsequent transaction then pulls the shipping settings from Recharge. Often, brands aren’t aware of this discrepancy between their customers’ first order and second, third, fourth, and other future orders, which can cause confusion and create a negative customer experience. 

The solution: Set up both shipping profiles on a weight basis, which doesn’t change, rather than charging a flat fee, which can fluctuate.

ISSUE #2: Shipping charges for subscription vs. one-time products

Similarly to the issue above, shipping rates for subscriptions on the first shipment are pulled from Shopify, while subsequent shipping rates for subscriptions are pulled from Recharge. However, Recharge does not handle any costs for shipping one-time products—all of those rates will be pulled from Shopify.

The solution: Use a Shopify discount code for the first subscription shipment that auto applies to subscription orders. Then, ensure shipping rates are set up appropriately in Recharge so all subsequent rates are accurate.

ISSUE #3: Free shipping for subscriptions but not one-time purchases

Many brands want to provide free shipping for subscription orders but not for one-time purchases. The only solution here is to hide shipping rates in Shopify via Shopify Scripts. Note: For this to work, the merchant must be on Shopify Plus.

For example, let’s say a Shopify Plus merchant wants to offer free shipping for their subscription orders, but the first order on Shopify doesn’t have a toggle for free shipping. By selecting “If subscription product, then free shipping” in Shopify Scripts, they can eliminate the shipping fee for subscription orders but not for one-time purchases.

The importance of shipping profiles

With all the brands they work with, Chelsea and Rachel emphasize that shipping profiles are a crucial part of the overall DTC strategy. In fact, if you’re upgrading to the Shopify Checkout Integration, shipping profiles are one of the first things you should align with your customer experience.

While merchants and customers alike often assume shipping will “just work,” this critical element of logistics requires careful consideration—just like any element of your customer experience.

Finally, to provide an industry-leading shipping experience, be sure to constantly A/B test and optimize your shipping rates. They should be reevaluated constantly—not just when a problem occurs—to deliver a best-in-class experience.

All together, these efforts keep your subscribers with your business, allowing you to foster the types of long-term customer relationships that lead to higher lifetime value, greater customer satisfaction, and reduced churn.

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The value of community engagement https://getrecharge.com/blog/the-value-of-community-engagement/ Tue, 06 Apr 2021 13:39:54 +0000 https://rechargepayments.com/blog/?p=962 When trying to scale a subscription commerce brand, there are no silver bullets. Your overall success depends on the business plan and subscription model, but a handful of strategies employed together can help you stack the deck when scaling a brand. Some of those strategies are things like curated subscription boxes, cross-selling and upselling, and

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When trying to scale a subscription commerce brand, there are no silver bullets. Your overall success depends on the business plan and subscription model, but a handful of strategies employed together can help you stack the deck when scaling a brand.

Some of those strategies are things like curated subscription boxes, cross-selling and upselling, and content marketing best practices. There’s also utilizing headless commerce and paid search to amplify your online presence. And now, even things like SMS for subscription interactions allow you to have multiple touchpoints with your customers.

However, you can do all of those things right, and yet still miss the mark with building community engagement. The often overlooked strategy, especially when it comes to subscription businesses, is investing in your community members.

Who are your community members?

Understanding who qualifies as your community is as simple as looking at not only who buys your products, but also at who engages with you from a social media standpoint. Your vendor partners also count as members of your community, allowing you to optimize your business so you can better engage with your customers.

You can use your analytics and market research to clearly identify your community, and you can also break them into categories. As an example, your community categories may include: current customers, previous customers, engaged, non-engaged, tech partners, future customers, niche customers, etc.

But why is community so important, and why does building an engagement community matter when scaling your business?

The psychology of communities

From a psychology perspective, people crave belonging, and want to be a part of engaging communities. That is why things like peer reviews, user feedback, and user-generated content (UGC) are so popular. While people generally trust companies and the claims of their products, more and more consumers are relying on the voices of the community members to inform them if the investment or purchase is worth it. Refersion, a referrals-focused company, notes that “74% of consumers identify word of mouth as a key influence in the purchasing process.”

Subscription businesses are naturally set up to take advantage of those community referrals. Traditional ecommerce brands spend significant marketing dollars trying to attract and retarget potential customers for return purchases. Subscription brands can repurpose those “retargeting” dollars and channel them into things like upselling and cross-selling because their subscribers are coming back already.

So what is the psychology behind subscriptions and the community involvement within them?

While often referred to in a negative sense, there are plenty of instances where the psychological phenomenon known as groupthink can be a positive thing. For example, a new hire recognizing positive company culture often results in that person assimilating seamlessly, forming strong relationships, and contributing to overall goals.

From a community engagement perspective, brands that can get their customers bought into the overall value proposition of the company and its mission are likely to be positive promoters and attract other potential customers to join the movement.

Picture yourself scrolling through social media. You come across a targeted ad for a swimsuit, a product you’ve been interested in with summer coming up soon. Which are you more likely to click on?

  • An ad with hundreds of reviews and plenty of comments from customers, or
  • An ad with no visible reviews or comments?

The role of influencers in community engagement

Think about the ever-present role of social media influencers. As they have positive experiences with a brand, they often share that to their followers, resulting in a huge lift for many ecommerce brands. That particular community member is using their influence over others who then feel that they want to be a part of that same community. 

This also leaves brands open to the greater potential for those influencers to become detractors. If the customer experience doesn’t live up to the expectations of the community using the product, brands have to work that much harder against those negative biases to “make it right” in the eyes of social media.

That’s where the power of psychology comes into play. Customers want to feel validated that they’re not the first person to buy this product. If lots of people before have purchased, and taken the time to leave a real review, that leads to confidence that more people will buy in the future and become members of your brand community.

Using the engagement community for growth

All that being said, building a community doesn’t directly equate to revenue growth. You’re playing the long-game. As mentioned above, there are countless ways to monetize a business based on revenue models, overall strategy, and more. If community engagement is not the route to revenue, so be it, but it should play a role in overall growth of your brand.

Social media opportunities for community engagement

Facebook groups are a great place to start building your presence within a community. Odds are you’re doing some level of advertising on Facebook. Invite every customer who subscribes to your product to a shared group where you can discuss exclusives, engage as the brand, and facilitate organic engagement between community members. Those customers will interact with each other and explain the value prop of the company in ways individuals hadn’t thought of, which provides opportunities to grow retention.

Just as with influencers, there is flip-side to being present on social media. It is important that you have a dedicated member of your team to maintain a pulse on the sentiment within the group(s). Groupthink can drive things forward for a brand, but a few shared negative experiences can also highlight issues. Engaging with community members when issues arise publicly will show that you are present and available to provide exceptional customer experience.

Twitter is another great place to ask for feedback in a public forum. This, as you already know,  may open the door for negative feedback, but most customers would be happy to give you honest and genuine feedback about your brand in a public forum. If you can interact with those community members on a personal level, they’re much more likely to try new products leading to increased average order value and serve as an organic referral for you.

Keeping your people at the forefront

A closing word of advice: Be authentic! Your customers are smart. After being shut out of public places for over a year, they have taken a masterclass in authenticity. When brands promote their services or products selfishly, only delivering value to themselves or simply looking for sales, they lose. 

The brands that figure out how to deliver content with purpose, advertise creatively, and drive joy and confidence within their community will win. And with a huge boom (91% growth, in fact) in subscribers to the overall pool, showcasing your amazing community, or starting to build one, will draw new customers to your door.

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How Underwaterpistol weathered the pandemic—and came out stronger https://getrecharge.com/blog/how-underwaterpistol-weathered-the-pandemic-and-came-out-stronger/ Tue, 10 Nov 2020 13:28:53 +0000 https://rechargepayments.com/blog/?p=785 Recharge caught up with Underwaterpistol, a London-based Shopify agency that weathered the worst of the pandemic. We discussed what it felt like to go through a once-in-a-lifetime crisis, how they worked their way out of trouble, and what the future holds for ecommerce and the wider economy.

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On March 23, 2020, UK Prime Minister Boris Johnson announced a country-wide lockdown, instructing all non-essential businesses to close. Overnight, pubs, restaurants, retailers, and gyms closed their doors, not knowing when — or even if — they would reopen.

Faced with restrictions not seen since the Second World War, the economy went haywire. Economic output plummeted, consumer confidence vanished, and centuries-old businesses teetered on the brink of collapse. Even online businesses, sheltered from most of the restrictions, suffered. Businesses hit pause on projects, pulled advertising campaigns, and retreated into their shells.

But things didn’t stay that way for long. Parts of the economy, particularly online segments, rebounded quickly. Often, they bounced back higher and stronger than before.

Recharge caught up with Underwaterpistol, a London-based Shopify agency that weathered the worst of the pandemic. We discussed what it felt like to go through a once-in-a-lifetime crisis, how they worked their way out of trouble, and what the future holds for ecommerce and the wider economy.

What did you think 2020 was going to look like? What were you hoping to achieve this year?

Gary Carruthers (Founder): We were planning to consolidate and continue building on a couple of years of steady growth. We were building out the team and our offering in quite a conservative, strategic fashion. Then it all went sideways. It’s been a mad journey ever since — quite a scary one at times.

Sophie Seaton (Head of Commercial Development): It’s difficult to think that far back now. So much has happened in such a short amount of time. At the start of the year, we would’ve expected our growth to be slow and steady. There was a massive focus for us on what our offering is, what our value proposition is, and refining both of those things to separate ourselves from other agencies.

When did you first realize that COVID-19 was becoming a global issue? How did the pandemic first affect your business?

Sophie: We had really open discussions about what was going on. I think that’s one of our strong points as a company. It wasn’t a case of leadership having a view on what was about to happen and keeping it to themselves. It was always an open discussion on, among other things, how the team felt about going into the office.

It’s difficult to pinpoint when we realized that it was serious. There was a scary period that lasted a few weeks to a month where our brands were terrified and pulled back drastically on budget.

Gary: In the first two key weeks of the crisis, we lost about 40% of our retainer business. It was absolutely terrifying. We collectively huddled together and said, “We need to get our heads down and work through this.” Because I’m in advanced years, I’ve been through a couple of economic crises over the years. The accepted wisdom has always been to market yourself out of trouble. Sure, batten down the hatches but don’t go into yourself. We collectively decided to do that.

Some of our clients didn’t decide to do that. They thought they were on a sticky wicket and they brought in the administrators. That was quite shocking to see. The circumstances that led them to make those decisions reversed very quickly. If they’d stuck to their guns, they could’ve come out of it fairly painlessly in a short period of time.

We were very lucky. After a few weeks, we were already coming out the other side. It was quite amazing to see. We were talking to other agencies who were experiencing very similar things. There were casualties amongst our contemporaries, but for the most part, I think people that we rub shoulders with have done pretty well.

Sophie: Businesses that have been proactive, dynamic, and bold seem to be the ones that have thrived.

What did you hear from your clients pulling back? What was their rationale?

Gary: There are pragmatic decisions and there are decisions made by mindset. The mindset-driven decisions were the really poor ones. I’m not speaking about our clients or people we work with, but some businesses just saw this as an opportunity to go into themselves. That’s a mindset that the business leaders just had. They used the pandemic as an excuse to, as they saw it, get rid of deadwood, furlough unproductive members of staff, and just lay people off. For me, those aren’t pragmatic decisions. That’s a crisis of confidence. Going into yourself is never a good way to make decisions, especially when the going gets tough.

Sophie: There’s a saying that comes to mind: fortune favors the bold, especially in tough times. The bold are the brands that made the difficult decision to weather the storm and stick to their marketing spend, rather than pulling back.

Paid media is a key example. It’s so easy to pull your ad spend. With channels like paid advertising where it was easy to pull back, it meant that the brands that didn’t pull back were much more successful. For four to six weeks, it was a much less competitive space. There were some really attractive auctions and cost-per-clicks because lots of brands have just turned that channel off.

SEO is another example. One of the biggest things that we said to brands was, “If you pull back on everything that you’ve been doing from an SEO perspective, you will have to start from scratch almost. It’s not a switch-it-back-on type channel.”

Was there a turning point for ecommerce during the early stages of the pandemic? When did you realize things were starting to get better?

Sophie: For me it was new business. In particular, the fact that it didn’t dry up. Because of the dip in existing work, we expected to see the same pattern in new business — but it never happened. We were still getting inquiries and there were brands still speaking to us about new builds and new business models.

Gary: We had a couple of inquiries from people who saw opportunities in the state of flux. That was interesting, even if some of the ideas didn’t bear fruit.

We were increasingly hearing brands say, “Well, this is a temporary situation. The lead time for these projects is several months. Chances are if things play out like the news says it’s going to play out, we’ll be launching around about when people are coming out of this anyway.” A lot of people were very pragmatic about it and that was really good for our confidence. It’s not like you switch everything off and then pop up in a few months’ time whenever there’s a vaccine. It wasn’t going to be like that.

These people, these brands that we’re working with, they’re smart people and they did the sums and thought, “Well, we’ve got budget to spend, we’ve got all the strategic stuff in place. We need to crack on and hope that things do come out the other side.”

Were there any trends or patterns in the type of new inquiries you received?

Sophie: Yeah, definitely. There were a couple of things. Fashion brands accelerated plans to bring out loungewear ranges. One of our brands, in particular, just happened to have one in the pipeline and it landed at the perfect time. So fashion brands launching loungewear was a big one.

There was definitely a move towards innovation in food and drink, which ties in really nicely with subscription. There were a couple of new ideas that popped up around supermarket queues, for example. Local producers and suppliers began offering home delivery. That was another trend we saw.

And anything that tied into capitalizing on people being at home more saw a boost. There was a boost in more brands thinking about how they can utilize subscription, because it’s just becoming more normal.

Looking back, what are some of the toughest challenges you’ve faced as an agency?

Sophie: The biggest one that comes to mind is remote working. While remote working has been a part of our agency, we did have a London office in Soho. I’d say half of the team went in around three days per week so there was definitely an impact of not having that base anymore and losing that contact.

We’ve had some… let’s say, brotherly and sisterly fallings out. That’s just down to the nature of speaking more on Slack, rather than seeing each other face-to-face. We have got a really nice team vibe, so we did eventually pick up the phone and have a chat, rather than relying solely on Slack. I think that’s something that has become a normal thing to do: just Slack, without speaking to people at all.

Getting used to fully remote working without any human contact has probably been more draining on some people than others. Hiring and onboarding people without meeting them is definitely difficult.

Gary: I’ve been working from home for the best part of 25 years, but the fact that I don’t see the team every couple of weeks has been a bit of a culture shock for a variety of reasons.

On a personal level, I think there have been plenty of struggles with lockdown and all the existential stuff that comes along with something like COVID. It can be really difficult. I think we need to be generous with each other when things are going badly. There’s always more to a bad day or a falling out. We need to give each other plenty of slack in that regard.

Interactions with our clients have completely changed, too. We did a lot of business remotely because we worked with people all over the world, but sometimes we had to go for lunch or run an in-person workshop. All that stuff is on hold. Now, you have to be creative with how you keep things engaging whenever you’re interacting with clients.

We were very nervous about doing workshops just via Hangouts because that was a bit of a strange thing to do, but now it’s second nature. If anything, our ecommerce strategist says she prefers the ground she can cover in a Hangouts call. 

I think we’re going to come out the other side so much more knowledgeable about how remote looks and feels.

What were your biggest learning points in 2020

Gary: My biggest takeaway in the last few months is how our whole hiring strategy has changed. We’ve learnt so much in the last six months and there is actually a strategy now, whereas before it was very ad hoc.

But now it’s very proactive and very strategic. We work very closely with our recruiting partner to put some meaning to our approach — and it’s paying dividends. It’s making us think a lot more carefully about the sort of blend of skills and the blend of characters.

Jennifer Caust (Head Of Marketing): From a digital marketing perspective, brands now have to innovate to stand out digitally because suddenly everyone’s doing online marketing. Before, you had a lot less competition. Now, everyone’s suddenly like, “Okay, I need ads. Okay, I need content. I need emails. I need social.”

For the brands that had already implemented things, like personalization, they’re now a step ahead, they’re comfortable. But there are still a lot of brands playing catch-up. My key takeaway this year would be being quick and agile.

Sophie: Expect the unexpected. That’s my golden nugget of learning from the year.

Will Lynch (Content & Partnership Manager): I agree with the webinar fatigue syndrome that everyone seems to be having. We’ve worked closely as a team to make different types of content that are hopefully more engaging than what everyone else is doing. For example, a couple of quick-fire, four-minutes videos. I suppose the learning point is: don’t be too long in the marketing that you put out. Keep it short.

What challenges do you think ecommerce faces in 2021?

Gary: It’s boring, but for me it’s about hiring wisely. I’m enjoying working with the team we’re putting together and feel we’re building something that’s got legs. For me that’s what I want to increasingly get involved in.

Sophie: I think the biggest challenge will be digital transformation. In the past six months, we’ve experienced years’ worth of growth in the ecommerce space and I don’t think that that’s going to slow down. Even when we have the option to go back to the high street, I think brands are going to realize the opportunities in ecommerce and the speed of that widespread transformation will continue.

For us, as an agency, that poses a challenge in making sure that the team is constantly upskilling, because there’ll be new technology, new trends, new ways to implement things, new business models. It’s about making sure that we’re at the forefront of what’s innovative in the Shopify world and the subscription world.

Will: From an ecommerce perspective, accessibility is probably going to be a big challenge. Ecommerce was very much limited to a certain age demographic — but this year my dad started shopping online for the first time. He struggles with some of the user experience. Going into 2021, with more older generations shopping online, the challenge will be ensuring sites and apps are accessible for all. But there’s a big opportunity there as well.

Beyond 2021, what do you think ecommerce and the wider economy will look like?

Gary: All bets are off.

Jennifer: It depends on what industry you’re in. If you’re in food and drinks, I think it’ll be all about innovation. How can you make something fun? Take subscriptions. How can you make a fun subscription experience, like wine and cheese Friday night boxes.

In the fashion vertical, I think sustainability will be an increasingly important topic. Just look at what H&M is doing. They’ve got a garment collecting campaign. I’ve seen luxury ecommerce brands do things like repairs for life where you can return your product and get unlimited repairs.

Sophie: Yeah, I think sustainability’s a big one. We’ve got a couple of brands in the luxury space. I can think of three off the top of my head. Two out of those three are looking at subscriptions.

One is a kind of rental service, which completely plays into the sustainability piece, and the other is something a little bit more mainstream. Brands being innovative about subscription models will be a big thing.

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How to use UTM parameters for subscription revenue attribution https://getrecharge.com/blog/how-to-use-utm-parameters-for-subscription-revenue-attribution/ Tue, 16 Jun 2020 11:25:56 +0000 https://rechargepayments.com/blog/?p=620 Marketers have been using UTM parameters for decades to track the effectiveness of their campaigns. In an increasingly competitive ecommerce world, it is more important than ever that a business understands the effectiveness of its marketing tactics. We are ecstatic to announce that Recharge now supports media attribution via UTM parameters within the built-in Analytics

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Marketers have been using UTM parameters for decades to track the effectiveness of their campaigns. In an increasingly competitive ecommerce world, it is more important than ever that a business understands the effectiveness of its marketing tactics.

We are ecstatic to announce that Recharge now supports media attribution via UTM parameters within the built-in Analytics suite. We are helping you take analytics a step further by allowing you to attribute marketing activities to your Recharge recurring revenue, active customer count, and engagement.

If you’ve never worked with UTM parameters and want to understand why it’s a best-practice for nearly all marketing professionals, check out Neil Patel’s “The Ultimate Guide to Using UTM Parameters.”

Before we start

Enabling UTM parameters on your Recharge store is a turn-key solution once it is set up correctly. It requires a few pieces of code to be updated in the cart footer to allow the values from your Shopify cookie to be automatically attributed back to your Recharge analytics suite.

Additionally, UTM parameters will not backfill from previous marketing campaigns, we can only track new data coming in. We recognize the data will only be useful after results from a number of campaigns are analyzed. Therefore, even if you don’t anticipate using UTM parameters now, we suggest you update the cart footer to make sure you have the data when you want it. 

Requirements:

In order to use UTM parameters with Recharge, you must be using Recharge Version 3.2 (updated on December 13, 2019) or later of the subscription-cart-footer.liquid file. The file can be manually updated by following these instructions or the Recharge Support Team can make the necessary changes if you email support@getrecharge.com.

How does our technology work?

Our goal was to build a merchant-facing tool to show the impact of marketing campaigns and media spend on recurring revenue, customer acquisition, and overall lifetime value. Designed with ease-of-use in mind, this new tool will provide visibility into your acquisition and retention funnels to help understand return on ad spend (ROAS). Less time compiling data allows for more time to analyze your business and invest in scaling via the advertising platforms or marketing tactics of choice.

Functionality and examples

Attribution summary and attribution KPIs can give us both high level and more granular insights into how these sources impact the merchant’s recharge business.

Revenue by channel:

revenue by channel

Each channel is noted by a unique color and visually highlights the total dollars of each. You also have the ability to drill into each weekly section to see individual daily data.

KPIs by channel:

kpis by channel

Dive deeper into individual channels and analyze data points like total revenue, average order value (AOV), average customer value (proxy for LTV), and even refunds.

How to use UTM parameters for Recharge

utm parameters

The above data is pulled from a Recharge demo store to highlight examples of how to use the new functionality within the Analytics suite.

If we look at rows 5 and 6, we see that email marketing yields significantly higher AOV and lower churn. This is as to be expected because remarketing campaigns are usually designed to increase value from existing customers. However, remarketing campaigns also capture lower volume in terms of revenue and active customers.

Rows 1 and 2 show organic traffic and paid social media which has the highest revenue attributed to it. These two sources have the most active customers coupled with relatively low customer churn.

Rows 4, 7, 8, and 9 highlight blogs and newsletters which are top contributors to the recurring revenue stream. However, the audience that comes through these channels show high churn and lower AOV which also signals low LTV.

Merchants often use these insights to allocate media dollars away from low-performing sources and invest more in high-performing sources. The new Recharge UTM parameters dashboard allows you to monitor how changing spend distribution impacts the underlying metrics that contribute to ROAS.

Closing

Recharge merchants had been piecing together bits of technology to understand where their marketing dollars were being spent and how that translated back to their overall subscription sales – until now. Using UTM parameters within the Recharge Analytics dashboard will help understand your return on ad spend and can contribute to future growth.

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Erase revenue leaks by serving customers better https://getrecharge.com/blog/erase-revenue-leaks-by-serving-customers-better/ Fri, 24 Apr 2020 06:54:14 +0000 https://rechargepayments.com/blog/?p=587 Merchants have a problem that is easy to spot but incredibly hard to diagnose. The symptoms are obvious: shrinking revenue, declining customer lifetime value and increasing cost of customer acquisition. What makes these issues hard to solve is that none of them happen at once or for one singular reason. It turns out that for

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Merchants have a problem that is easy to spot but incredibly hard to diagnose.

The symptoms are obvious: shrinking revenue, declining customer lifetime value and increasing cost of customer acquisition. What makes these issues hard to solve is that none of them happen at once or for one singular reason.

It turns out that for many ecommerce merchants, revenue is leaking out of their operations all along the customer’s buying journey. We’ll get to the particulars in a minute, but the very nature of the problem means that no one in the ecommerce enterprise has a complete view of where things are going wrong.

The good news is that there is a way to get a handle on just where the pressure points are that are causing bad things to happen to good orders. Better still, there are relatively new and powerful technology solutions that can help merchants stop the leaking while building a loyal customer base.

First, the challenge

The places in the buying journey where the problems arise tend to be siloed which causes them to be monitored by independent teams:

  • The payments team might have insight into the percentage of orders that are being declined in the payment pre-authorization and authorization stages.
  • The fraud and risk team sees how many orders are being denied by fraud tools and manual reviews.
  • Operations teams know how many orders fall out of the revenue stream because of inaccurate or incomplete inventory management.
  • Finance has line-of-sight into the number of lost orders due to chargebacks or customer claims of dissatisfaction.
  • Operations teams also monitor the impact of returned goods.

How to fix the issue

Signifyd’s analysis of a representative sample of merchants found that as many as 14% of orders are lost along the way. That’s before adding in additional revenue leakage from returned goods, fraud chargebacks, and chargebacks arising from customer disputes. While those figures vary by vertical, you can add another 15% or so for a moderate-return-rate vertical like electronics.

leakage

“As we go through this,” says Indy Guha, Signifyd SVP of Marketing & Alliances, “you’ll see a pattern of what I would call death by a thousand paper cuts.”

But merchants can disrupt the pattern by turning to the data. In order to fully leverage the rich data they do have, merchants can break down the internal silos that prevent the business from forming a clear view of the buying funnel. They need to get teams to collaborate on this issue.

Once the enterprise’s different departments are working together, merchants need to develop a revenue leakage dashboard that provides a comprehensive view of the buyer’s journey to help them assess and plug holes.

The next step is to establish a revenue-leakage benchmark that can help measure the severity of the problem at each stage in the buying journey. Merchants need to know where they stand in comparison to others in the same space; taking factors like their vertical, basket size and brand maturity into consideration. There is a whole industry of consultants whose expertise can be drawn upon.

Once a merchant knows where it stands compared to others in its vertical, it can identify where revenue leakage is the most severe and take steps to strengthen that weakness. The next part of that phase includes optimizing that trouble spot; measuring improvements and testing effectiveness; then moving to the next problem and repeating the cycle to improve.

It is a lot of work. But remember that new and powerful technology we mentioned earlier? This is where that comes in.

Revenue leakage is a reflection of a poor customer experience

Each point where revenue leaks out of the buying journey is a representation of a time when a customer encountered friction and frustration. Revenue leakage is the outward manifestation of a toxic customer experience. 

Often the friction is the result of barriers that merchants erect between themselves and willing customers based on the fear that some percentage of buyers will try to take advantage of them either through criminal fraud schemes or through customer abuse perpetrated by consumers looking to game the system.

The fear is understandable in our era of data breaches when identities, personally identifiable information and account information are stolen by hackers who make off with a staggering amount of information.

Last year, we lived through the worst year for data breaches in history. The number of breaches in 2019 was up 30% over 2018. In the third quarter alone, 3.1 billion records were exposed.

A Thales survey found that globally, 60% of respondents had suffered a breach – 30% coming in the last year. In the U.S. the numbers were higher – 65% and 36% respectively.

Unfortunately, you could point to any number of huge breaches. A Facebook breach exposed the personal information of 267 million users. In March, Capital One suffered a breach that exposed more than 100 million records. What’s in your wallet? Pretty much everybody knows now.

Those breaches and the stolen credentials involved in them are the fuel for a vast marketplace where identities are bought and sold on the Dark Web. They provide the raw materials for fraud rings which create fictitious accounts and take over others to commit online fraud.

So, the problem that was Facebook’s and Capital One’s and a host of other organizations very quickly becomes the problem of merchants with an online presence (which is pretty much all of them). A big problem. Between 2019 and 2023 businesses will lose about $130 billion in fraudulent orders according to Juniper Research.

But here’s the thing: By trying to avoid that $130 billion loss, businesses are costing themselves billions by turning down good orders for fear of fraud and by investing in inadequate fraud solutions.

Fear kills international orders

Many merchants are especially wary of international orders because they often involve markets in which the company does not have a deep wealth of transaction history. Furthermore, different countries have different regulations regarding personal data therefore making it difficult to reliably verify a buyer’s identity.

Because of those concerns, 6.8% of international orders are declined according to a study by payment processor Cybersource. The figure for domestic orders was 2.9%. The discrepancy becomes even more interesting when you consider that Cybersource found the actual fraud rate for international orders was .9% – virtually the same as the rate for domestic orders.

order rates

Think about that: same fraud threat regardless of an order’s origin but merchants turned down more than twice as many international orders. 

While on the topic of discrepancies, consider the difference between the actual fraud rate and the decline rate. At their best, on domestic orders, merchants are turning down orders at a level that is two percentage points higher than the actual fraud rate.

cash flow

That points to the problem of false declines, which cause significant losses. In 2019 Forrester Consulting conducted a study in which it analyzed the difference between a legacy rules-based fraud prevention tool and a machine-learning solution powered by big data. It concluded that by up-grading its fraud solution, a composite enterprise realized $912,000 in sales over three years that it would have otherwise declined for fear of fraud – with a fringe benefit of saving $3 million by avoiding fraud chargebacks and it saved $413,000 by eliminating manual reviews. Furthermore, the composite merchant retained $408,000 in revenue that would have been lost to cancelations due to fulfillment delays.

We live in the era of zero-tolerance consumers

Consumers’ expectations are evolving rapidly and it goes without saying that their expectations are not being lowered. Empowered consumers expect to be able to buy where they want, when they want, and using the channel they choose. They expect to be able to buy online and pick up in store or buy in store and have their orders delivered to their homes. They want easy returns whether they buy online or in store.

In the era of the zero-tolerance shopper, failing to meet those expectations have dire consequences. Signifyd’s 2020 Consumer Sentiment Survey, conducted with polling firm Survata, found that 64% of consumers would tolerate no more than one bad experience with an online merchant.

survey

We can stipulate that being a legitimate customer on the wrong end of a declined order qualifies as a bad experience. Nearly a quarter of the 2,000 online consumers that Survata polled had endured that experience. More importantly for merchants, nearly 30% of those said they would never shop with that brand again.

survey

Losing the chance to make a sale to an insulted customer is bad, but losing that customer for good is devastating. The damage starts with the fact that a merchant who loses a customer has squandered the cost of acquiring that customer – a cost that is rising by the day with competition in the Google/Facebook/Amazon digital ad space continuing to rise.

It’s also important to consider the loss of a lifetime of purchases from disappointed customers.

Wrap-up

No question, merchants are suffering from a revenue-leakage problem. The way to get ahead of it is to:

  • Turn to the data
  • Break down silos and make data accessible across teams
  • Commit to practicing fearless commerce
  • Protect customer lifetime value by accurately sifting fraudulent orders from legitimate ones and abusive customer claims from those with merit
  • Seek professional help to protect you from fraud and consumer abuse in a highly automated way that shifts liability away from your business

In the end, the choice is clear. Merchants can live with the problem of revenue leakage and pay dearly, customer-by-customer, as they lose shoppers to competitors. Or they can invest in a clear vision of their data and the tools that will enable fearless commerce while helping them build a fan base for the ages.

Contact us to learn more about how Signifyd’s Commerce Protection Platform can help you identify and stop your revenue leaks.

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Wrap up from ProfitWell Recur https://getrecharge.com/blog/wrap-up-from-profitwell-recur/ Thu, 19 Dec 2019 15:43:16 +0000 https://rechargepayments.com/blog/?p=559 Last week, the Recharge team attended Recur and was immersed in a full day worth of strategic subscription content. Led by ProfitWell CEO Patrick Campbell, the content was intriguing and thought provoking and led to multiple actionable takeaways throughout the day. If you weren’t lucky enough to attend, here is a sample of our favorite

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Last week, the Recharge team attended Recur and was immersed in a full day worth of strategic subscription content. Led by ProfitWell CEO Patrick Campbell, the content was intriguing and thought provoking and led to multiple actionable takeaways throughout the day. If you weren’t lucky enough to attend, here is a sample of our favorite content – but also make sure you attend next year!

UPDATE: All presentation videos are now hosted on the ProfitWell website. Check them out!

Recur 2019 just wrapped and we couldn’t have been more pumped to have the Recharge team along for the ride with us. Aside from being awesome integration partners, COO, Chathri Ali, brought the knowledge to our crowd with her top takeaways on global ecommerce growth at scale.”Patrick Campbell, Founder and CEO, ProfitWell

Recur

First up was April Dunford. Not only is April an accomplished startup positioning consultant, but this was her forty-third speaking engagement of the year. 43/52 weeks in 2019 April was on stage, and for good reason. Positioning is one of those buzz-words all startups think about but never seriously work through. Positioning your product is arguably the most important thing a company can do in its early stages because of what it does for your buyers.

To quote April herself, “We do not buy what we do not understand.” Ensuring your target customers know exactly what you’re selling, what the benefit is, and why it’s better than the competition is what will drive sales. Gone are the days of launching your product and hoping it sells.

Plus she gave everyone a copy of her book, we’ll take free stuff any day of the week.

book

Chris Savage, Founder and CEO of Wistia, discussed his theory on SaaS companies acting more like media companies when delivering content. He hypothesized that the more content companies put out, the more engaged their followers became. By splitting one large campaign into multiple bite-size chunks, companies not only get more visibility across channels, but also can capitalize on continued engagement long after the original piece was created.

Along the same lines, Wistia developed a documentary called “One, Ten, One Hundred” where they work with a video production company to create three ads for $1k, $10k, and a whopping $100k. This tested the relationship between creativity and dollars, check out the results for yourself and start delivering content more effectively.

Recharge was lucky enough to have our very own COO, Chathri Ali, invited to speak on growing and scaling a remote-first team. In one of the most anticipated talks of the day, Chathri laid out the history at Recharge and how it was a goal from the start to hire the best talent regardless of location.

With over 130 employees in 10 countries, Recharge has become a veteran in the remote workforce space and Chathri was able to divulge a few of our secrets as to how we got there.

Up next was Dan Martell, Founder of Saas Academy. Dan’s talk was all about removing friction from the customer journey. In his own words, “The next wave of Enterprise Software companies are removing friction & creating a consumer-level customer experience.” The best tech companies are filling a gap in functionality, but not at the expense of their end customers.

The B2B2C world is rapidly filling up, there is no more room for a product that is difficult to use or confusing in its implementation. A frictionless experience from your business is not a nice-to-have, it’s table stakes.

Finally, Patrick Campbell returned to the stage to deliver his closing keynote which focused in on the theme of Recur 2019: time. How can business owners make the most of the available time to drive the biggest impact to their end subscribers? Patrick dove deep into the ProfitWell data to deliver some intriguing conclusions from their 10,000 merchants.

Do Founders and CEOs with hobbies produce a faster or slower growing company from $1-10 million ARR? Turns out, companies grow faster when the leader is solely focused on the company’s growth. Hobbies and activities outside work tend to keep a person refreshed, avoiding the ever-growing ‘burnout.’ However, the data points to exponential growth with a sole focus on business. While it may not be the most sustainable way to grow a company, it is the fastest.

Do remote-first companies grow from $1-10 million ARR faster or slower than their in-office counterparts? This was a particularly interesting data point because of Recharge’s culture rooted in remote work. One might assume because of the flexibility and eliminated commute, these types of companies have more dedicated workers and therefore grow faster. However, the data points the other way.

Companies with employees in the office every day grow faster than remote-first companies. There are clearly pros and cons to both sides, there may even be a critical point where remote-first companies grow faster at a revenue figure north of $10 million. However, data is king and it doesn’t lie.

Our week in Boston helped us reflect on our data collected in 2019 and re-center our focus moving into 2020. The ProfitWell team was hospitable and knowledgeable and provided one of the better event experiences of the year. Cheers to a successful event and anticipated growth to all parties involved in the future.

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6 creative growth tactics for the holidays https://getrecharge.com/blog/6-creative-growth-tactics-for-the-holidays/ Mon, 02 Dec 2019 10:12:59 +0000 https://rechargepayments.com/blog/?p=556 When it comes to the holiday shopping season, competition is fierce. eMarketer’s forecast indicates total ecommerce holiday spending in 2019 will increase to 13.2% (up from 10.8% last year) to a whopping $135.35 billion. Of course subscription merchants want a piece of this – and they want those customer relationships to continue well beyond the

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When it comes to the holiday shopping season, competition is fierce. eMarketer’s forecast indicates total ecommerce holiday spending in 2019 will increase to 13.2% (up from 10.8% last year) to a whopping $135.35 billion.

holiday growth

Of course subscription merchants want a piece of this – and they want those customer relationships to continue well beyond the holiday season. The question is: How?

We turned to a few different experts and asked their opinion on this burning question: What are some creative tactics subscription merchants should experiment with during the holidays? 

Here’s what they suggested.

1. Enable one-time purchases

“Creating one-time offers (despite being a subscription merchant) is a great way to reach new customers and potentially gain more loyal, long-term buyers who stick with you even after the holidays.” -Nicole Leinbach Reyhle, founder of RetailMinded

Not all shoppers want to commit to an ongoing subscription before trying it out first, so it makes sense to enable one-time purchases during the holiday season to open the doors to new customers with a fear of commitment. Make sure for those who do opt for the one-time option, you’re going above and beyond with customer experience and packaging so your first impression is a strong one. Consider including a personalized note, “freebies”/bonus items, or a coupon code that incentivizes the subscription route once they’ve had a chance to experience your product firsthand.

native checkout
In their Customer Portal, Native offers some of their most popular items as one-time additions to a subscriber’s upcoming shipment.

2. Experiment with mystery boxes

“Offering mystery items or mystery boxes is perfect for subscription merchants that are looking to add some excitement to a standard subscription.” -Brendan Hufford, SEO Consultant

One of the most beloved parts of unwrapping holiday gifts is the excitement that builds around the unexpected. The human brain has a serious need to fill information gaps, and the element of mystery or surprise fuels the experience of tearing through wrapping paper to find out what’s inside. Vox reported on this phenomenon, saying: “[The unknown] has always been the core appeal of mystery boxes; sometimes it’s more fun to leave things up to fate.”

This is exactly the same idea that fuels interest in mystery boxes–which is a creative holiday idea for subscription merchants for two reasons:

  1. It’s a good way to offload products that aren’t moving as quickly as others. By integrating these items into a mystery box, you can disperse more of this product while introducing customers to your best-sellers at the same time.
  2. For shoppers who already know what they’re getting as gifts, the element of surprise that comes with a mystery subscription includes a promise for something unexpected, which some buyers crave.

If nothing else, mystery boxes can be a fun experiment to test out alongside your more traditional subscription offerings during the holidays.

3. Focus on community-building & education

“Community-building and education should be a top priority for subscription retailers. They can do this by creating things like a forum wherein customers can share advice, ask for help, and celebrate each other.” -Kristen LaFrance, Growth at ChurnBuster

It’s one thing to sell a subscription, but it’s another to go deeper with customers and to create a community hub where they can learn more about your products, get advice on how to best use them, and talk to other customers. Building a space that fosters this type of connection-building, education, and resource-sharing is a major value-add for customers who then feel like an insider or part of an exclusive club. With this sort of offering, subscribers will likely feel more invested in the products and excited to share these positive community-focused learning experiences.

friction free shaving
Friction Free Shaving offers free recycling bags for used razor blades to reduce plastic content in the sea.

4. Incentivize gifting in an inventive way

“Allow current subscribers to gift a subscription to a friend or family member at a discounted rate to get new subscribers hooked.”Rachel Ashley, freelance writer and editor

The idea of incentivizing/discounting gift subscriptions is one that’s top-of-mind for most merchants with this type of offering, but you can take the idea a step further by putting an interesting spin on your approach. Think about incentivizing gift subscriptions by:

  • Letting existing subscribers earn loyalty/referral points for each gift subscription they purchase for someone else (Recharge has plenty of integration partners who can help you do this well).
  • Letting subscribers earn free add-ons, subscription credits, or upgrades based on the number of gift subscriptions they purchase.
  • Doing a giveaway wherein anyone who purchases a gift subscription is entered to win something like a free three-month subscription, a mystery box, or a gift card to your store.

5. Use donations as a data strategy

“Create a donation/impact strategy. By enabling your subscribers to donate to a cause they align with, you’re able to create a different type of message and engagement with customers around something emotional. We’ve seen customers who donate increase LTV by 18%, and post-holiday, having the data on who your customer supports enables you to re-engage them before they unsubscribe with an impact/emotional message.” -Ronny Sage, ShoppingGives

Customer data and analytics are the secret ingredients when it comes to relevant personalization, engagement, and understanding the true wants and needs of your subscribers. An inventive way to gather this type of data is by leveraging a donation add-on during the holidays that let subscribers give back and feel good about their investment in your products.

Pledgeling, a social evangelist company, makes it easy to add a social good component to your store. Their philosophy is that, “‘social responsibility is no longer a feel-good phrase for conference room chatter, it’s a modern matter of survival.” By linking ecommerce companies and charitable organizations, they create a seamless customer experience where everyone wins.

With the insight you gain from these donations, you can better speak to the individual’s core values when they’re at risk of unsubscribing down the road and deploy an emotion-based winback campaign that speaks right to the heart of what they care about most.

6. Offer an exclusive item to loyal customers

“Promote an exclusive holiday gift and make it seem like as a customer, they’ve been invited to your holiday party as part of your club.” –Terry Schilling, freelance copywriter

People like to feel special – plain and simple. By offering your loyal subscribers an exclusive gift item only they have access to, you’re reinforcing important messages like:

  • We really value you and want to offer you something to which only our insiders/VIPs have access.
  • You’re special and we love you, so we created an exclusive item only our most loyal subscribers can buy.
  • Because you’ve been such a loyal customer and we value your insight, we’ve made a top secret product that only a small group of people will get to test out before it’s launched to the masses.
huel checkout
Huel offers first time subscribers a free t-shirt as a welcome to their membership.

Maximize subscriptions during the 2019 holiday shopping season

These tips and ideas are just the tip of the iceberg when you think about all the different ways you can incentivize shoppers to buy (and gift!) subscriptions to your products during the 2019 holiday shopping season. Try a few out and see what produces the most impressive results for your business.

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Using PayPal + other credit card processors in tandem https://getrecharge.com/blog/using-paypal-other-credit-card-processors-in-tandem/ Tue, 12 Nov 2019 09:08:03 +0000 https://rechargepayments.com/blog/?p=550 PayPal or other payment processor? You no longer have to choose: Recharge now supports PayPal in conjunction with other payment processors like Stripe, Braintree, or Authorize.net. This new feature will provide subscription customers more payment options for their orders made on mobile and desktop, further reducing friction during checkout. Advantages to PayPal for subscriptions Aside

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PayPal or other payment processor? You no longer have to choose: Recharge now supports PayPal in conjunction with other payment processors like Stripe, Braintree, or Authorize.net.

This new feature will provide subscription customers more payment options for their orders made on mobile and desktop, further reducing friction during checkout.

Advantages to PayPal for subscriptions

Aside from the fact that PayPal speeds up the checkout process and helps reduce cart abandonment as a result, another benefit to providing this payment option to customers is that it accommodates the growing number of mobile shoppers, which is expected to account for 54% of total ecommerce sales by 2021.

Plus: Statista reports show that PayPal is the leader when it comes to digital wallets (and is the most popular option by a long shot) with more than 286 million active accounts worldwide as of 2019.

digital wallets
Image source

What’s more: Providing customers with multiple ways to pay is a conversion-booster. YouGov data found that 40% of online shoppers feel more comfortable purchasing from an online retailer with multiple payment methods available, while 50% would abandon their shopping carts if their preferred payment method wasn’t available.

Now you can introduce this additional payment option alongside your existing credit card processing tools and tap into this large user base.

How it works

Using PayPal, shoppers can make secure purchases in apps or on the web without having to enter credit card information during checkout.

In the past, subscription merchants using Recharge could only use PayPal if they also processed credit card transactions through Braintree. Now, PayPal now works in tandem with Stripe, Braintree, and Authorize.net.

So, for example: Credit card processing can work via Stripe while PayPal transactions run through PayPal.

The layman’s difference between Braintree and PayPal is that Braintree is a credit card processor (owned by PayPal) while PayPal is more like a bank (where money exists within an account and can be sent digitally). 

You can see what this looks like in action within premium Japanese snack company Bokksu’s mobile checkout: Subscribers have the option to pay via credit card or PayPal.

shipping

Getting set up

Merchants will need a Braintree account to leverage the functionality of PayPal with Recharge. 

Before you dive in, be aware that:

  • To accept PayPal, you’ll need both a PayPal Business account and a Braintree account. If you already have a PayPal Personal account, you can upgrade this for free.
  • Be sure to review PayPal’s processing fees. Note that if you refund an order, PayPal withholds the fixed fee portion.

Step 1: Sign up for a Braintree account 

You can set up a Braintree account to run all PayPal transactions while still using Stripe to run all credit card transactions. By pairing these two secure and popular payment processors, you’ll be able to provide more choice and security for your customers.

To complete the setup in Braintree, you will need to connect your PayPal account to Braintree. Further instructions can be found in the Paypal Braintree guide.

Step 2: Connect Recharge to Braintree

From the Recharge Dashboard, click Settings > General Settings then select Braintree/PayPal from the dropdown menu.

braintree

Enter your Braintree Merchant Id, Public Key, and Private Key into the fields below. To make PayPal available, you will need to select the Braintree PayPal Active checkbox.

activate

View PayPal at checkout

Customers will now see a PayPal option at checkout. They can log into their PayPal accounts to complete their purchase.

paypal

Step 3: Switch your payment processor back

Important note: Remember to set your credit card processor back as your default payment processor after setting up PayPal! This way your credit card transactions still process through your default processor while still displaying PayPal as an option.

If desired, run a test transaction through your payment processor to verify your default choice is active. Use the support article here to assist with this functionality.

Test a PayPal transaction

PayPal doesn’t support a test or sandbox mode, so you will need to process a real transaction to test your PayPal connection. To test a PayPal transaction, use an alternate PayPal account at checkout, and then refund the order. It isn’t possible to check out using the same PayPal Business account connected to your site.

Apple Pay plus Braintree

In addition to offering PayPal + other credit card processors, merchants on the Recharge Pro plan with a custom checkout domain can also offer Apple Pay + Braintree.

test checkout

Learn more about Apple Pay + Braintree and Recharge Pro here.

Results & impact of PayPal

In Q2 of 2019, PayPal’s net payment volume was a whopping $172.36 billion US dollars, representing a 22% year-over-year growth. 

impact
Image source

As shoppers become more mobile-centric, digital wallets like PayPal help accommodate buyer preferences and make shopping faster and more secure. Some data even indicates that by 2030, digital wallets will be the primary source of payments.

So what does this tell us?

Adding PayPal as a payment option is a smart idea for subscription merchants who want to:

  • Offer shoppers a simpler, faster, safer way to pay (in fewer clicks)
  • Accommodate buyer preferences and mobile shopping habits
  • Reduce cart abandonment through a checkout workflow with less friction

Check out the support article for more information.

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Customer portal showcase: Theme engine https://getrecharge.com/blog/customer-portal-showcase-theme-engine/ Tue, 22 Oct 2019 09:00:33 +0000 https://rechargepayments.com/blog/?p=512 Subscription commerce veterans from across the world converged in Santa Monica in October for two days of learning and networking at ChargeX Summit 2019 powered by Recharge. Day 1 was focused on preeminent agencies building off the platform. Guest speakers from agencies of all sizes spoke on a variety of topics including scoping new projects

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Subscription commerce veterans from across the world converged in Santa Monica in October for two days of learning and networking at ChargeX Summit 2019 powered by Recharge.

Day 1 was focused on preeminent agencies building off the platform. Guest speakers from agencies of all sizes spoke on a variety of topics including scoping new projects and productizing solutions to common requests and alternative methods to build revenue.

Jason Tranel, Senior Product Manager, Recharge

Summary from this talk:
• Customers expect a highly tailored journey both pre and post checkout
• The customer portal isn’t a one-and-done interaction, it’s an ongoing relationship with your customers
• Version 2 of the Theme Engine is in open beta now, backed by the API it offers greater functionality
• The updated Theme Editor will provide a familiar experience for developers and reduce time to productivity
• Theme Engine offers greater customer self-serve enablement which secures revenue generation and revenue protection for agencies and merchants

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How to use data-driven insights with Recharge enhanced analytics https://getrecharge.com/blog/how-to-use-data-driven-insights-with-recharge-enhanced-analytics/ Tue, 24 Sep 2019 14:52:13 +0000 https://rechargepayments.com/blog/?p=508 How much do you really know about your customers? In the highly competitive market where attention to your brand is the commodity, having unobstructed access to your high-quality data, and the ability to drive insights from them, could make or break your business. The problem, however, is that too many businesses choose to ignore data.

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How much do you really know about your customers?

In the highly competitive market where attention to your brand is the commodity, having unobstructed access to your high-quality data, and the ability to drive insights from them, could make or break your business.

The problem, however, is that too many businesses choose to ignore data. In fact, according to a 2019 survey composed of 64 C-level executives for major brands, 72% have yet to forge a data culture and 52% admit that they’re not even competing in data and analytics.

Others may think that they’re using their superior customer experience to determine the right course of action or relying on company history to fuel their decisions. But unless you have hard data to back your assumptions, you’re only guessing.

There are three metrics that every ecommerce merchant should be tracking to better understand the health of their subscription business:

Keeping churn low while growing MRR can mean dominating your niche and increasing the ability to reinvest in your business compared to with fighting seasonality or flash sale success.

That’s where our Enhanced Analytics feature makes its greatest impact.

Why we built enhanced analytics

When we started building a platform that provides data insights for a wide variety of verticals, we wanted to focus on what Recharge merchants care most about across the board:

  • LTV: Lifetime Value of each customer. Knowing this number and your cost of acquisition will help you tip the scales of a subscription-model business towards success.
  • ARPU: Average Revenue Per User. Divide your total revenue over the average subscribers in a given period and you’ll have ARPU, which helps you measure your revenue trends.
  • Churn/Retention: Churn comes down to one number – how many customers stop being customers over a given period (frequently over a monthly basis). But it’s not just about whether your customers are sticking around, it’s just as important to understand how quickly your subscriber base is growing. Use the provided churn analysis report to analyze when and why subscribers may be dropping.
  • Campaign tracking: Cohort analysis allows you to draw a correlation between new initiatives and base level performance. This gives you critical insights into what actions and reactions are having the best effects on your sales.

These are the core numbers that play a part in your revenue – and you can find those insights with Enhanced Analytics.

Enhanced analytics: A deep dive into functionality

Analytics shouldn’t exist in a vacuum. Instead, analytics should be a key component of your marketing.

We approached the launch of Recharge Enhanced Analytics with a three-pillar strategy:

  • Transparency: Analytics should illustrate all important data for maximum transparency. Data needs to be clear, actionable, and revealing if it’s going to make a difference in future decisions.
  • Forecasting: The past is often a helpful indicator when it comes to looking ahead to the future – and subscription-based businesses need accurate forecasting to diagnose these trends. That’s why we made accurate forecasting a major part of Enhanced Analytics.
  • Insight: It’s not enough to have numbers. What do the numbers mean, and how do you translate them into actionable outcomes? Enhanced Analytics dives into more than just what’s happening. It reveals why many customers are making decisions that lead to churn.

Recharge merchants are highly diverse – even within the same vertical, no two businesses require the same insights. When building Enhanced Analytics we stuck to our core three principles above as a guiding light. We can’t assume we know the specific data points your business intends to analyze. However, we can provide a robust, customizable platform you can manipulate in order to more effectively make use of your customer data.

How to navigate the new dashboard

When you log in to Enhanced Analytics, you’ll notice that all dashboards default to the previous 30 days. However, you’re not limited to month-over-month. The option for “dynamic date range filtering” is available to give you any insight you need.

With these dashboards, you can drill down on any detail. Click on any bar chart or line graph and you’ll see the individual line items that make up the larger data set. You can then export/download these reports according to your specifications.

Where do the insights start? Here’s a look at each of the individual dashboards:

Revenue trends

revenue trends

Think of this as your high-level snapshot of the health of your business. Log in and you’ll get a quick sense of which way your business is trending.

Enhanced Analytics includes the following crucial data points:

  • Overview of Sales: Gives a bird’s-eye view of all sales made within a period.
  • Active Customers: Indicates how many customers are currently subscribed.
  • Subscription Creations/Cancellations within Date Range: Tracks the changes in a given period by showing the creations, cancellations, and the overall net effect.
  • Recurring vs. Checkout Sales: A checkout sale is the first purchase of a subscription or a “one-time product” sale. A recurring sale is any subsequent sale auto-charged to a customer who’s already signed up.
  • Sales per Charge: Essentially, your Average Order Value (AOV). How much is each customer charging on average within the time period you selected?
  • Total Customers with Average Subscriptions: How many customers do you have now? Understand the trend lines to discover future revenue potential.

Customer cohort

customer cohort

The dynamic cohort selection helps you measure how well your customers are holding on once they’ve become customers. This gives you insight into customer churn and key data points on your marketing campaigns.

Here are some of the essential features:

  • Churn By Cohort: View your customer churn numbers within the specific cohort of sign-ups within your selected time period. This allows you to track changes in customer churn over time.
  • Custom Definition: Your measurement of a cohort works best when you define your custom cohorts for specific measurement. That includes sorting a cohort on a specific sign-up date. This is great for measuring the success of flash sales, special offers, and other marketing campaigns.
  • Charges per Customer: Answers the question: How many charges do you average per customer within a specific date range?
  • Active Subscriptions: View how many customers purchased within a specific time frame. 
  • Active Subscriptions by Day: You don’t need to limit yourself to data sets over a month. Get specific about your subscriptions to see what strategies are working best day by day.
  • Cancellation Reasons: It’s not enough to know that customers have canceled. This feature helps you pinpoint why customers are canceling.

Cohort retention

retention

Merchants selling subscriptions know that retention is just as important as acquisition. So is the data. Using the Cohort Retention features, you’ll track the value of customers and learn more about their behavior with specific parameters. 

Here are some of the features:

  • Cohort Side-by-Side Comparisons: Find out what your cohorts look like month over month.
  • Customers with Active Subscriptions: See how many people are currently subscribed. Like many of the features in Enhanced Analytics, you can drill down into any of the variables here for more insights. This helps you find out more about your customers beyond their subscription status and identify changes over time to see where you’re going wrong–or right.
  • Month-over-Month Changes in Total Sales: Identify where sales trends are heading, analyze the effectiveness of specific campaigns, and find the LTV of the customers these campaigns brought.

Who is enhanced analytics for?

Recharge Enhanced Analytics is for any store that wants to take a deep dive into their numbers. The minimum requirements include enrollment in Recharge Pro.

Keep in mind that there are some limitations: For example, we currently do not have a way to incorporate migrated customers. That means you should only plan on using the Customer Cohort and Cohort Retention dashboards for signups that occur after you migrate to Enhanced Analytics.

If you’re currently using OneClickUpsell or Carthook, keep in mind that the first subscription charge totals do not get reported in Recharge, but we will report on the customers and subscriptions that relate to these initial charges.

Next steps: Join the beta or apply for pro membership

Enhanced Analytics is only available to Recharge users on the Pro plan and is currently at the Closed Beta stage. (Note: You can find out more about Enhanced Analytics by visiting our support page for its Closed Beta process.)

That means you have two options for your next steps:

  • Apply for Recharge Pro. Scroll down to “Request Access” and fill out your company information to find out more.
  • If you’re already on Recharge Pro, you can request access to the Closed Beta.

If knowledge is power, then the quality of your data can make all the difference. Use Enhanced Analytics to reduce churn, optimize your campaigns, and build more long-term value in each customer.

The post How to use data-driven insights with Recharge enhanced analytics appeared first on Recharge.

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