75 Prozent Kündigungsrate im Abo Modell in den Griff bekommen

0:00I sell a monthly meat subscription box to chronically ill and health-conscious people and we launched five months ago and we are currently doing like 33k per month in revenue. >> So this is a brand new thing that you just started? Yes, that's right. And my question is about churn. Okay. Because customers who stay past the first couple of months tend to stick. For example, our very first group of customers from five months ago, they just placed their fourth order and churn from last month to this month was only 16%.

0:33I mean But new customers churn a lot after their first month. Mhm. From the group that bought for the first time last month, 75% did not buy a second box. Okay. So the question is what should I do to specifically reduce the churn between the first and second month of the subscription? What do you want to do with this business?

0:59Well, this was the first business that I wanted to do something that would compound because before I was in forge education, one course that I would have to promote all over and over again. Yeah, yeah, I got you. All right. Um And I'm sorry, just a little reminder, I hear myself double in the phone. Good to know. Sorry about that. Can you hear me without hearing the double?

1:25Yeah, I hear you perfectly. >> All right, so I'll just I'll do more of the talking. How about that? Um >> [laughter] >> Okay. So here's the deal. You're You're selling like wellness boxes to people who are sick, right? Yes. Okay, got it. Um Is it a changing thing every month, like what's inside of it?

1:48Yeah, they they actually have to place the order each month again. They have to manually place it again? Yes. Oh, well, I mean, that's I mean, that's thing number one. I mean, it has to be automatic. No one's going to want to do that every month. Yeah. So, I would just say like have a default box and they can choose to edit it if they want to, but like you send a default box to everybody. Even if it's new. Does that make sense? >> Okay.

2:14So, that's thing number one. Um but what I The reason I asked like what do you want to have happen with this business? Is this all drop shipped or is this like you have a warehouse full of like goodies? Uh we have we have uh rented a warehouse and we have farmers who who sell the sheep who sell the meat to us. Okay, so it's meat. I'm sorry. I just hear Yeah, good. It's meat.

2:39>> this beeping sound. Ah, got it. Okay, so these these are meat boxes. This is like Butcher Box. Yeah, yeah, it's exactly like Butcher Box. Got [laughter] it. Okay, understood. Um avatar selection seem to be really important, number one. Number two, so it's like if you go to poor people, they will turn out because they basically bought you for a one-time discounted like steak or whatever. Um you want to be positioning against groceries and like their source of food.

3:07Um and you'll probably need a mix of different meats. It is very elastic from a pricing perspective, which I don't love. Um I'm pretty sure like actually I don't know if I'm under NDA. Well, I've seen very big ones of these and they run paper thin margins. Mhm. So, I don't know if this like I'm being like really real with you. I don't know if this is like, "Hey, I want to just have like it's tough because people's people's flavors change, their palate change.

3:36This isn't me trying to tell you not to do this business, but like this is going to be a hard business that will eat capital for a long time. We actually didn't have to invest anything into that. Uh-huh. We have like third-party logistics and we just Yeah. People people pay to us and then we go buy the meat. Yeah. Yeah. Yeah. No, I get it. Um okay, so number one is that you have to give them a sample box every month and just have them uh agree to the this the mix of meats. That'll be much easier for you and make everybody do the default there. Um I'm assuming the next issue is that people will basically feel like they already have enough meat.

4:17So, they don't need more. And so, before they do their subscription, you need to text them and tell them like they have the option of skipping uh skipping a month and so it can go every other month. Um or like they can change their order via text if they want to just like cut the cut the portions down in half. Both of those are viable and they have to be able to do that conveniently. Um but I think the biggest thing though is going to be how they're being sold.

4:41If it's sold only based on like Is it Is it Is it mostly sold on the discount, the fact that it's cheaper to buy it this way? No. No. No. Quite opposite, actually. Okay. >> We We called it better meat. Okay. And we just sell at a premium. Okay. >> those from the farmers, pasture-raised, and everything. Cool. Then what was the number one reason that people canceled? Or did they just not reorder?

5:08We We just did a survey and there were two reasons. First one was that they were not able to curate their box and second was price. Got it. Okay. So, I would sell on the meat being superior as obviously the strong angle which you already have, which is good. Um from the customization, I think you have to make it easier. So, it's like you will get the default box and you can edit it via text. No one wants to like log in and do it. I'm just telling you right now. So, I think you could just have an agent that receives it and then and then edits the orders in the back.

5:44It's super are now. Um so, there's that. I think editing the the system flow. In terms of the pricing, normally I ignore people who say price stuff, but when it comes to food, it is so elastic um, in terms of pricing. So, it may be like a are you pricing it by pound? No, we just price it per per box. Yeah. I would The nice thing that you can do is you can probably because it's not going to because you're just getting started with this new business. Um, I would consider price testing trick like do this first stuff first, right? Add in Add in the the the like a default box that they can change whenever they want.

6:22Add the text in ahead of time so they can skip. They can cut the portions in half or add it all in that one flow. That's the first thing that I would do. Beyond that, um, I would test funnels that are like maybe like quarterly shipments cuz that'll also help you offset CAC cuz you'll be able to get more cash up front and it'll be less frequent. So, that's another option. That'll probably be like test number two. That will allow you to scale more. That will probably allow you to scale faster.

6:50Um, and um, number cuz you could also basically think about this way it's like you could have the subscription renew on a different cadence than the boxes are being shipped. Does that make sense? Yes. So, that that's probably like I know I'm giving you to like you have one clear thing which is meat. So, a lot of the a lot of the tests are going to be like kind of like pricing and offer driven.

7:15Um, but these are the things that I'd be looking at. Can I just add Uh, we tested the pricing because very first months we calculated poorly and we had to increase the price and we did it in AB test and it was like plus 35% and plus 50%. >> Mhm. And now we see that those with 50% churn less. Churn less. Okay, so this is good. So, what it is is basically what so before I don't know, I mean the day the sample size seems kind of small given the revenue. So, I don't know if it's statistically significant. So, I'd probably just keep running that. But, if the 50 keeps winning, then what that would indicate to me is an avatar thing. So, that means that you need to lean more in terms of the creative on the types of people who resemble the ideal customer more.

8:02Mhm. So, it's like we need to target those people and we need messaging that resonates more with that person. And so, it might I mean, you might find that 50 and that 100% boost actually goes even higher because they just want the best stuff. Mhm. So, that makes sense. Like, if you become a stre- like, I'll tell you a completely different example, but like in the gym world, when we had memberships that were like at $300 a month, it was a price point that was like a stretch for a middle-class person, but too cheap for a rich person.

8:30It so, kind of gets in this no man's land. And so, you might find that plus 75 even performs better than 50. Again, if this data holds. Yeah. It It's holding for 2 months already, and we are at the top of the market right now. Okay. Then, there might be a position for you to continue to raise the price so that they can associate with premium. And just say And I would say like, in then if that becomes the position, then all my copy in the ads is like, "We are not the cheapest meat. In fact, we're the most expensive you can find, but that's because we're the best. And meat is probably the most meaty thing that you're eating as a portion of your diet.

9:05And so, you should probably think about like every single calorie that you eat is what your body gets made of. It's like, wouldn't you want to eat the best stuff?" Mhm. So, those are probably the marketing angles I would take. I would experiment with the different billing cycles, and for sure I'd add in the AI agent. There's part of you that's probably going to be afraid of like texting them before the billing, but you have to just get rid of all of that. You want to just have a product that people want to keep subscribing, not that they forget about it.

9:31Yeah. Yeah. Yeah. Yeah. No, no, it's okay because anyway, in Czech Republic, we have to remind them before before the charge. Even better. So, yeah, that like I would have the AI agent allow them and then I would really strongly consider switching to a quarterly billing cycle um as a test and then you and you deliver them weekly or whatever. Yeah. Makes sense. Makes sense. And and focus on the avatar on the higher avatar.

9:58>> 100%. That's what it's I mean that's what it's showing very clearly. It's the richer people who want it. So, then like keep Honestly, I'll keep going until the they they tell me no. Mhm. So, like if if this test concludes >> you elaborate? So, when this test concludes between plus 30 and plus 50, you might have a plus 50 versus a plus 75 and run that test. Yeah. I understood. Even if it's the same, it's like it's a huge amount of extra profit.

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