Expert Picks w/ Andriy Rudnyk, Good Subscription Agency
Jump into the sea of subscription apps with the guidance of our guest Andriy Rudnyk. He breaks down the common mistakes when picking an app and forecasts the future of subscription apps. Plus, discover his number one advice for growing your subscription business – it’s all about your most valuable subscribers. Tune in and boost your business strategy.
In this episode, we'll cover:
The Unofficial Shopify Podcast
7/4/2023
Kurt Elster: If you’re listening to this show, you have at the very least considered subscriptions, and that’s harder than it sounds because there are dozens of subscription apps in the Shopify app store. There’s at least 30 of them. Plus, there’s some that may be unlisted that you could use, as well. So, which is the right one? How do you choose? We all want that recurring, predictable revenue, right?
And so, returning to the show to help us decipher it is subscription expert Andriy Rudnyk. Formerly Bold Commerce, now at the helm of Good Subscription Agency, he’s a champion of subscription brands, and today he’s going to help us navigate the labyrinth of over 30 subscription apps on the app store and help us talk through if you’re currently on a legacy subscription app. Yeah, there’s like legacy apps, too. What do you do? What’s your best option? So, that’s what we’re going through today.
I’m your host, Kurt Elster.
Ezra Firestone Sound Board Clip: Tech Nasty!
Kurt Elster: And this is The Unofficial Shopify Podcast.
Sound Board:
Kurt Elster: Andriy, welcome.
Andriy Rudnyk: Thank you, Kurt. Thanks for having me on again. I’m pumped to talk about this wild landscape of the most paralysis analysis choices you could have on the app store. Yeah.
Kurt Elster: Before we dive into that, why are we listening to you? You went Bold, founding your own agency, let’s start with that. Why did you start Good Subscription Agency?
Andriy Rudnyk: So, I was working at Bold, and I saw a market gap in an agency that was specifically servicing the subscription model. So, basically agencies… A subscription business in eCommerce is really almost its own business model. Some people argue that it’s just a different way to buy, but in my mind you’re really operating a little more like software as a service. Long story short, I saw that gap. I started the agency three years ago focusing exclusively at working with subscription brands. So, over the last three years I’ve tested, installed, suggested, migrated to all of the basically 20-plus apps that we have. There’s like 30, there’s delisted ones, but subscription app game, selection, migration, and optimization is the bread and butter of what we do.
Kurt Elster: Okay. I accept that. So, who then is a good candidate for subscriptions?
Andriy Rudnyk: Okay, so as far as a business, if you look at… If you’re not running with a subscription offer, and if you simply look at these repeat purchase rates for your business, if you’re somewhere above 50%, 60%, that’s a no brainer for implementing a subscribe and save, at least a replenishment program, but there are many different ways. There’s at least four core ones that I look at. And that’s you can implement a subscribe and save if you have a product that is a consumable or replenishable. Think about toiletries, think about deodorant, think about home products, toilet paper, toothpaste. Then you could look at curated boxes, and these are kind of box of stuff, or these are specifically like every month or every couple of months you get a niche collectibles, high quality from different types of artists. So, you can have curated boxes, so that’s one way to branch into subscriptions.
Another one is memberships specifically and going in with more of a membership model, where you get access to certain things if you subscribe month to month, and those are just a couple, to name a few. But if you can… I mean, I feel brands can figure out… If customers keep coming back to buy the product over and over, that generally means that you’re a pretty good fit for a subscription program and a subscription app.
Kurt Elster: Before we dive into choosing a subscription app, I want to go back and talk about legacy subscription apps, like Recharge or Bold. There’s like version one if you were one of these subscription apps before these Shopify checkout changes. Give me the recap there. What’s going on with that?
Andriy Rudnyk: So, yes, the marketplace for apps, and especially for these, for legacy apps like Recharge and Bold version one, so let’s call it… I don’t necessarily like to call them legacy. They have started with their own checkout; they built a checkout outside of Shopify. This was actually the only way to build a subscription app prior to 2021. So, before then, you have only large, enterprise level companies could build their own checkout, do it securely, do it properly, and you could still… and most people I know right now, actually, most brands are likely using still Recharge’s own checkout or Bold’s own checkout.
Shopify recently came out and announced finally a deadline for migrations for that, and that’s October of 2024, and they said, “We’re basically gonna discontinue orders if you are on one of these old checkouts.” This is not crazy news. This is news we’ve seen coming. But for the first time, we have actually a sunset deadline where we have to absolutely migrate from the old versions of the apps to the new versions of the apps using the Shopify checkout.
Basically, what does that mean for let’s call it Recharge and Bold in particular? So, Recharge is the biggest player here. Recharge has actually been very, very good at keeping… basically making that migration process as seamless as possible. And there are very few things that you would be either giving up or not getting if you are for example getting or leaving behind on the old checkout and upgrading to Shopify checkout. But most of the time, you’re actually gaining a lot in features because you’re now fully functional, you’re fully using the Shopify ecosystem and you’re fully using the Shopify checkout. Better analytics, better integrations, just basically metrics that work, which is really difficult to do if you have two separate checkouts on your store.
And the better metrics you have, the better business decisions you can make, so Recharge has been actually very, very good at letting people who use Recharge and their Recharge’s older checkout migrate to the Shopify checkout and they’ve been processing people through. And so, that’s an easy process.
If you are stuck on the old one, now you have to decide okay, now we either migrate to the Shopify checkout, or we look at okay, what other option’s out there as far as subscription apps? And still, Recharge is still a fantastic choice, even despite the 20-plus big apps that are… I’m gonna say 20-plus because there are some delisted ones, some that have like three reviews, and I’m gonna leave it at that.
For Bold, it’s a slightly different story. In the last three years since Shopify really pushed, or basically since 2021, Bold has really been focusing on enterprise-level business. And what that means is they have one of the best-in-class API docs. It’s really robust, really snappy. Basically, Bold rebuilt a brand new subscription app in 2020, whereas for example Recharge, their code base is still from 2014. All of their docs have been kind of piled onto. And not to say that they’re poor, but massive enterprise companies use them, but Bold’s been focusing on enterprise and they just kind of rebuilt their APIs and they’ve built an API-first app for subscriptions.
Now, one downside of that is if you’re SMB or SME, if you’re a small business and if you don’t know what APIs mean, that doesn’t really matter much to you. So, with Bold’s old version of the app has a lot more kind of out of the box features than the new version of the app, which focuses on easy custom development. So, then it kind of opens a can of worms of, “Well, if I’m on this old app and if I’m a small business, where do I go from here?”
Okay, and the answer is it’s complicated. So, there are… The landscape for subscriptions apps out there, like I said, we’ve spent testing and working on implementing and matchmaking brands with apps for the last three years, and it really is a matchmaking process. So, first of all, we can talk about the process itself. It’s like how do you know which app is good for you and good for your brand? We can dive into that.
First of all, you have to define what your subscription strategy is first. Because you have to… So, with 20 options, now there are apps that are best, that are really, really good at build a boxes but might not be as good at gifting. Some are really good at gifting but might not be great at churn prevention. Some are great for memberships. And it really helps to define your subscription growth strategy. I’m not gonna dive too deeply into how do you do that. Generally speaking, it’s identify your most loyal, highest spending subscribers, and ask them what they want. Most of the time, they’re either gonna tell you, “Hey, we want personalization of boxes,” for example, or, “We want more boxes more frequently,” or, “Hey, I want to prepay for the year,” or, “I want to get more perks.”
So, that would be step one. And in our case, let’s use an example you are a curated box, and you sell basically fandom stuff to your cohort and to your subscribers every three months. And they tell you, “Hey, we want to personalize our boxes. We love what you do. We want more boxes more often.” Okay, cool. So, you know what your growth strategy is. I’m gonna sell to my die hard customers more and more and I’m gonna find more of them and let them have an awesome experience. Then step two is you need to define your acquisition. So, there’s two types of features in a subscription app in my mind. There’s acquisition features and retention features. And retention is really about customer lifetime value, so acquisition is really how flexible and what kind of features you need to sell to, to basically onboard a first subscriber to begin with.
So, is it a build a box? Is it a really robust subscribe and save program? And when I say a robust subscribe and save program, pretty much all apps will allow you to do, “Hey, here’s the frequency and here’s a discount setup.” But what if you want to incentivize orders after the sixth order? Or what if you want to incentivize longer subscriptions? Can you add that on? So, that might be something that you need.
For a curated box, you don’t really necessarily need that. But for supplements, and household goods, you might want to incentivize that. So, that’s again how strategy weighs into what features you look for. And you want to define your needs. So, acquisition needs and acquisition features could be something like we need a build a box. If we have a large SKU count of products, if we’re a meal company, or yes, if we do have 50 different flavors for you to choose from, we want that to be easily done at signup, easily done in the portal once every single order is coming up, and then… So, same thing for gifting, and same thing for memberships.
So, some apps have better fit than others. Then after that, okay, this is how we’re gonna get people to sign up. Then you want to look at what you need for retention features or customer lifetime features. So, for example, if you are a supplement brand, then you will need… You have one core SKU that you refill all the time. Somebody is buying your CBD supplements and they’re buying them every three months, let’s say. But you want to be able to have really close communication and upsell them on accessory or complementary products, like, “Hey, try this one-time product, or try this complementary shaker,” or, “Hey, have another versions of these capsules for nighttime sleep.” So on and so forth.
So, you want to be able to have really robust upselling and personalization in the upcoming order flow. Those are kind of the retention features. And then churn features fall into that, as well. What kind of cancellation flows do they have? And what kind of… So, for passive and active churn, so cancellation flows as well as dunning features for credit card recapture. And then it’s like, “Okay, you have that long list of needs, wants, for acquisition, for retention. Then what do you do?” Well, you look through the app store, you see at the minimum, see what people are advertising, and pick the top three that fit into your brand.
We’re actually doing a subscription app showdown right now where we’re doing basically Spring 2023 reviews for apps. So, right now I just finished two of the top three for best starter apps, and also top three for best replenishment apps, so subscribe and save apps. So, for example, to get started, and if you wanted to, I’m posting all of this on LinkedIn, so if you wanted to give me a follow on LinkedIn, all of that content’s gonna be on there. But for example, to start and to get started, best starter apps, top three best starter apps are actually… So, number one for us was Timo Subscriptions, which had a ton of really good, basic, out of the box features, and the value was really there. The second one was Subify, which you’ve got, and Ongoing Subscriptions was number three. If you’re just looking to get started in subscriptions, those are awesome, really solid value to take a look at.
Kurt Elster: All right, which are the three best starters?
Andriy Rudnyk: So, Timo Subscriptions, Subify, and Ongoing Subscriptions.
Kurt Elster: Okay. Got it.
Andriy Rudnyk: Yes. So, these are just like if you’re just starting out, if you need an app for $29 a month, Timo is a fantastic choice. If you’re literally just starting with subscriptions. We’re gonna be doing breakdowns of best for enterprise, best for midsize, best for replenishment I just published, and so for subscribe and save, this is obviously a big category. It’s like the best subscribe and save app. And-
Kurt Elster: And that’s like how Amazon presents their subscriptions.
Andriy Rudnyk: Yes. So, it’s like the most popular, “Hey, you just need to give a discount on an interval, on a reordering interval.” The basic one.
Kurt Elster: Yeah. This feels like the most common implementation or use case of subscription on Shopify.
Andriy Rudnyk: Yes. Yeah. So, for us, the top three, and I’ll dive into just the first one a little more, but the first one was Loop Subscriptions, and they’re a fantastic, really robust toolkit for subscribe and save. They give you gamification on the customer portal around your next order rewards. They give you personalized flows and automations for personalizing upsell products in an upcoming order. Really robust churn prevention flows. Probably best in class. In my mind, not probably. Best in class churn prevention and best in class churn analytics.
So, they’re a little bit more expensive. They’re like $399 a month. But they’re one of the only apps that actually charge less than 1% transaction fee, so they come in at 0.75, which is actually-
Kurt Elster: We’re doing a migration from BigCommerce to Shopify right now for a client, and they have a huge subscription program, and migrating subscriptions is scary and difficult.
Andriy Rudnyk: Yes.
Kurt Elster: And Loop Subscriptions said, “Hey, we’ve done this before. Here. We’ll even share our SOP with you to prove it. And we’ll do it for you.” I was thrilled. And so, that… We’re gonna use Loop for that and I’m looking forward to it.
Andriy Rudnyk: Yeah. No, as far as diving into features, they’re a great team, really… It’s kind of mind blowing to see some of these apps developed to such an awesome feature set in such a short time, because a lot of them just started in 2020, 2021, whereas some of these older apps have been around since like… for the last 10 years. So, Loop, yes. Loop’s been number one, Stay Ai is number two, and Skio coming in at number three for best subscribe and save.
Kurt Elster: What’s funny is like that’s how I would rank it, as well, and I… There’s really I don’t think a wrong choice between those three, but yeah, those three are really good.
Andriy Rudnyk: Yes. Yeah. So, as far as migrations go, so Kurt, you just mentioned a perfect example. It’s like migrations can be… Generally, they’re pretty scary, although every single app will tell you that hey, it’s gonna be smooth. It’s gonna be we’re gonna take care of everything. It’s generally not that simple, because-
Kurt Elster: That’s been my experience.
Andriy Rudnyk: Yes.
Kurt Elster: I’ve had some bad experiences. I won’t name those.
Andriy Rudnyk: Yeah. No, no. And I want to give some of these apps, give them a bit of a break. Yes, the way a brand implements… So, basically you’re trying to swap an engine in an airplane that’s midflight. Really, that’s what you’re trying to do. And when you’re switching from one subscription app to another, because it’s your revenue engine. It’s something that processes and recreates all of your recurring orders. So, you don’t want to skip a beat. You definitely don’t want to lose any subscribers.
Thankfully, actually, from all of the migrations that we’ve done to date, we’ve never lost anybody. Never lost a single subscriber. And that generally is all due to the diligence of the app companies, so that’s awesome. The other piece, though, is the subscription app migration is a lot more than just swapping a bunch of payment tokens. Typically, so for example, if we take an example of you’re plugged into Recharge and you’re using three or five different… You’re using Klaviyo, obviously. You’re using Smile. You’re using Gorgeous or Rebuy and your subscription app is plugged into a whole bunch of other third party apps. The migration, the app company doesn’t take care of that. They will take care of the payments, but they will not take care of your Klaviyo notifications that somebody started a subscription, or that their order is coming up, or your SMS notifications around that.
So, that is typically something that is dropped the ball between teams, and that’s where we come in, and that’s exactly what people hire us for, is first of all app selection, and app matchmaking. It’s like we’re gonna install the apps, we’re gonna shortlist the top three, test them, demo them in a kind of independent, non-salesy way. Look at the exact use cases and bottlenecks we need for this particular app, for this particular brand, and then we’re gonna compare. It’s like, okay, does it make sense to migrate to one of these? It’s gonna be from a cost saving perspective, from an ROI perspective too.
So, that’s essentially the matchmaking process, is define your strategy, define your wants and needs, shortlist top three, compare the costs, and decide is this worth the migration or not? Or is this just a shiny toy syndrome?
Kurt Elster: All right, so try to figure out like am I chasing a shiny toy or is this the right choice? Is there a revenue level where you’re like, “Okay, now consider this?” What’s the rule of thumb here?
Andriy Rudnyk: In my mind, because we’ve done app matchmaking processes where it’s like literally we tell them, “Hey, you guys are best where you’re at. The current app is your best choice.” And in my mind, it really is the ROI on this project. So, because migrations are costly, and time consuming, and they take months, and they take time and effort. I would really… It really is a question of how much of a step up are you getting. Is this marginal? So, for example, I would say for most people, if you’re on Recharge currently, Recharge has really stepped up their game and they’ve really invested into their roadmap, and they’re rolling up memberships, cash backs, build a boxes, and bundles now, so for most people it’s… Recharge is in the top five apps as is. And if you are really chasing edge cases and it’s like, “Oh, you know, we really need the best in class build a box,” okay, cool. Then go look for that app. That app is in my mind Atomic Subscriptions.
But it really is how much of a step up? What is the ROI on this project? So, it’s really… It depends brand to brand. But yeah, is three months of your life and stress… It’s probably one of the most stressful projects you’ll do in a year. 100%. Because it’s very… It’s not something you just hit a revert button on. And is it worth the ROI? Is it 3, 4, 10X ROI? I would say if you’re on a legacy version of Bold, for example, and if you’re starting to look at the subscription app landscape and being like, “Okay maybe there is something better out there.” Yeah, there might be 3X, 10X better apps that are now giving you a really awesome build a box functionality, or really awesome cancellation prevention flows, or gamifying upcoming order notifications and upcoming order rewards. There’s a ton. There’s a ton to be found out there.
So, I would really say it’s like it really is… If it’s 1X to 2X ROI, it’s like okay, we’re gonna spend $20,000 on this migration, or $10,000 on this migration because it’s gonna need a different widget design, and a dig widget, and a customer portal redesign. Okay, cool. Is this gonna actually pay off in conversions and customer lifetime value? So, strategically that’s what I would say. And you’d really want that number to be somewhere between 3X-5X and up. But it’s hard to say.
Kurt Elster: And so, we’ve got… Our process here is are we a candidate, what features do we need, what’s best in class for the feature that’s most important to us?
Andriy Rudnyk: Exactly.
Kurt Elster: And really, those features are gonna be how we’re implementing the subscription. Is this a build a box? Is it the more traditional subscribe and save? Or are we entirely new to this and we just want something that’s simple and straightforward?
Andriy Rudnyk: Exactly. Yes.
Kurt Elster: Okay. From there, give me the overview of how subscription apps generally work in Shopify now. Like in the past you said, “Hey, it replaces the checkout entirely.” This is kind of a mess. Now it leverages selling plans in the native checkout. Any other caveats, things we need to know there?
Andriy Rudnyk: One thing to know, generally how these apps work is that yes, they create a selling plan for a product, which means it’s like, “Hey, if this customer agrees to buy this product and have an order created again, an automated basis,” and the app just remembers, basically stores that selling plan. Remember, Shopify really stores that selling plan. And the app lets the customer essentially go in and have a customer portal experience where they can log in, hopefully without remembering the Shopify account password, and a lot of these apps actually do offer passwordless logins now, which is really sweet.
So, this app allows a customer to drop in and have a portal that is easy to use on mobile and desktop, maybe send them notifications about upcoming orders and notifications that also upsell products on upcoming orders either through native integrations into SMS and Klaviyo, or third party tools like Twilio and other things, and Attentive. So, that’s essentially it. The app is really there to create a recurring order, let the customer know, and then prevent… or I shouldn’t say prevent them from canceling, but educate them on all the options that are better than canceling. I’m gonna put it that way.
So, whenever a customer decides to say, “Hey, you know what? This order right now that’s coming up, I don’t really want it right now.” The app’s job is to let them know that there are ways to reschedule, change their frequency, skip, postpone, snooze, pause, gift, and do all of that other stuff that is better than canceling in this case. And a lot of the times, most common cancellation reason for subscriptions is I have too much stuff, and that’s still really, really annoying, because that is not a reason to cancel a subscription. You can postpone. You can delay. You can just delay your whole frequency and say, “I don’t want it every one month. I want it every three months.” And again, these are all basic features you would see on Amazon.
And I think these are all things that customers at the end of the day want to have access to. Control over their own billing. The last thing you want is to get into a contract that is super rigid, and you can’t get out of it. Everybody hates that about cable companies, everybody hates that about cell phone companies, so okay.
Your subscription app is then there to make an awesome post-purchase experience. That’s really it. So, a lot of these apps are competing on how good is your customer portal? How good are your customer lifetime, like upselling features and gamification features? How easy is your portal to access? Also, how good are your analytics? How well are you displaying all this information to the business owner and showing them? It's like, “Hey, here are the top reasons for churn in the last month. Here are the top reasons for churn in this customer cohort.”
So, it really is a tool to help you maximize customer lifetime value for this repeat customer base, so it’s better to better understand your customer base, or subscriber base, and also give the customer the tools to basically order in the most smooth… to reorder in the most smooth and fun way possible.
Kurt Elster: You mentioned like, “Hey, the dashboard has gotta show KPIs. It’s gotta give you reasons.” Is there a metric or KPI or system used to determine effectiveness? Like I’ve installed the app, it’s running, should I keep going?
Andriy Rudnyk: The easiest check, there really is a gut check, and check-in with your CS team, and your support team. Are customers complaining about the portal less? Are your subscriptions growing? Are customers complaining about sign up and are customers complaining that they got tricked into a subscription? All of those things should be going down if you’ve made the right choice. And your subscriber numbers and your subscriber customer lifetime value, or one metric… Unfortunately, I haven’t seen actually an app that gives you this metric, is customer’s activation period spent. So, spend in the first 120 days. We can call it customer… Excuse me, you can look at customer lifetime value, but it’s a little more of an esoteric term. And by the way, you had an awesome customer lifetime deep dive podcast I really nerded out about.
Kurt Elster: With Dan McCarthy. Yeah. It was a good one.
Andriy Rudnyk: Yes. Yeah. Yes. So, but it’s like you can try to define customer lifetime value from a bajillion ways, but all I say is look at the first 90, 120 days of a customer, and how much did they spend in that time? You can easily find that data in Shopify and can pull those reports. And all of those numbers should be going up.
Kurt Elster: And how long until you build your own subscription app?
Andriy Rudnyk: Well, funny that you mention that, Kurt.
Kurt Elster: Ah, I knew it.
Andriy Rudnyk: Well, here’s the thing. With 30 apps, I don’t see the point of us building a subscription app. However, we’ve built a companion app that actually works with all the subscription apps, and it is designed… It’s a widget. It’s essentially a subscribe and save widget that looks on brand and converts more subscribers. It’s called Good Subscription Optimizer. Actually, should be on the app store pretty much any day now. We’ve gone through the review process. So, I say go check it out. If you can’t hire a designer or developer and all of the out of the box subscription widgets are just… Let’s call them limited. And you’re frustrated with those, check us out. Good Subscription Optimizer. And that’s what we’re doing.
Kurt Elster: All right, so I was close. Not quite. If someone’s overwhelmed, like they listen to this and they go, “Well, that didn’t help. Now I’m more confused than ever.” What advice would you give to someone feeling overwhelmed by this process?
Andriy Rudnyk: Okay. What I would say is if you’re not sure of the path forward, at least don’t make the most common mistakes. So, I could list a couple most common mistakes when selecting and deciding on the next subscription app. So, first of all is going with the first salesperson that talks to you. And sometimes I understand why that’s… It’s the path of least resistance is like if they’re already there, so I’d say look at at least more than one option. That would be one.
The second one is looking at app reviews on apps and judging how well this app will work for you based on app reviews in the app store. And Kurt, I’m sure that you know this, it’s like app reviews generally mean that they are the rating for the support, for customer support for that app. Which doesn’t necessarily mean that the app itself is bad, but funnily enough, seemingly the more difficult the UI of an app, the more customer support questions they have, the more customer reviews they have on the app store. It’s kind of funny that it sometimes works out that way. Obviously, it’s a sign, but what I would say, don’t just rely on reviews. Install these apps. They have great trial options. Install top two or three that strike your interest and play around with them. See how friendly the user interface is. See if they have the features you want and you’re gonna need long term.
Don’t forget the churn prevention tools and churn flows. And the final piece is like when you’re migrating, yes, the app company, most of them are gonna be very, very happy to onboard you to whatever app you choose. But don’t forget the third party integrations, or make sure that somebody on your team or on their team is responsible for things like Klaviyo triggers, SMS triggers, and so on and so forth. But if you really wanted to just say, “Hey, I’m just gonna outsource this to someone,” we do app matchmaking all the time. You can hit me up. We can talk about an intro call. You can find me at The Good Subscription Agency, goodsubscription.agency, and it’s our app matchmaking.
Kurt Elster: So, you had… Starting after Recharge got their huge valuation, and we had low interest rates, a huge amount of money was invested into building these subscription apps.
Andriy Rudnyk: Yes.
Kurt Elster: It became this gold rush. That’s a lot of what’s going on here. And I don’t say that critically. That’s the reality of the situation. And so, knowing that, what do you see or how do you see the future of subscription apps evolving in the app store? Let’s polish off that crystal ball here knowing that this is a prediction.
Andriy Rudnyk: What I think is gonna happen is we’re gonna have a lot of acquisitions and mergers between smaller apps. And some apps will die off in my mind. It is apps that are struggling to grow, struggling to find a niche, sometimes we look at… Again, there’s 30 apps. When was the last time you saw 30 product options for anything? For salsa, for bread, it’s like, “No, I don’t want to decide between 30 options. I want to look at at least three.” And so, I think some apps will sink or swim by deciding to focus on a niche or by differentiating really, so I think apps will get more niche in their functionality and the type of business they’re best suited for.
So, you’re gonna have subscription apps that are fantastic for build a box. You’re gonna have membership only apps. And then you will have kind of jack of all trades apps, as well, that are large. I don’t think those are going away. So, you’re also gonna have some low cost leaders, like App Cells, and Seals, and that take no fee outside of Teamoo, and really good starter apps for that matter. But in my mind, I think we’ll have more specialized subscription apps in the next basically a year, or two to three. We’re gonna see some smaller apps disappear or their feature bases will just get swallowed up by these bigger apps that need those feature sets.
Kurt Elster: You know, I agree with you. I think the M&A path is where this is gonna go, where you’re gonna see two apps who have overlapping feature sets go, “You know what? We’d be stronger together.” Or apps that one becomes a market leader and goes, “Well, we could roll up this. Rather than try and compete, we could just buy some of these competitors. And then we’ve got the extra revenue. Now our valuation goes up.” I think you’re right. I think that just is a thing that occurs with a maturing space.
Andriy Rudnyk: Yep.
Kurt Elster: So, wrap it up for me. Give me one key piece of advice for merchants looking to grow a subscription-based business.
Andriy Rudnyk: One key piece of advice for subscription growth, I would say listen to your most valuable subscriber cohort and try to please them as best as you can. That would be it.
Kurt Elster: And if… Go ahead.
Andriy Rudnyk: Yeah, I was gonna say and to expand on that, look at RMF analysis, so recency, monetization and frequency, and look at who buys the most, and the most often, who subscribes to all of your boxes, all of the versions? Who spends 3X, 4X more than your average subscriber? Get to know them. Build a community for them. Build a Discord. Build a Facebook group. This is how the largest and the best subscription brands do it. Build a community. Listen to it. Listen for product feedback. Don’t be afraid to iterate and put yourself out there. Because at the end of the day, it’s not marketing that’s gonna grow your business. It’s not gonna be on site experience that’s gonna grow your business. It’s not gonna be email. It’s gonna be an awesome product. So, listen to the feedback of customers and improve your product and expand your product based on the most diehard fans.
Kurt Elster: Solid, good advice. You can never go wrong with listening to the people who are trying to give you money or you wish to extract value from, right? If you want to serve them, you have to talk to them and then listen to what they’re telling you. It’s not outrageous advice in the slightest. But I think it’s a thing we all have to be reminded of as business owners, myself included.
Andriy Rudnyk: Oh, yeah. 100%. And I think the only thing, or for subscriptions specifically, it’s not all subscribers are made equally. Some people are buying for… They have two orders and then they cancel. Some people buy once every year, and they have an active subscription. Look at the highest value customers, your ideal subscribers, and define who they are, and build a community for them and listen to it closely.
Kurt Elster: No, absolutely. And if we wanted to learn more about you, I’m told I should find you on LinkedIn?
Andriy Rudnyk: Yes. Find me, Andriy Rudnyk on LinkedIn, or look us up at Good Subscription dot Agency and we can connect there.
Kurt Elster: And I’ve got links to your agency, your recommended apps, and you on LinkedIn, and since at the time of this recording your app, Good Subscription Optimizer, is not yet approved for the app store, I have linked to an app store search for Good Subscription Optimizer, and so we’ll find out.
Andriy Rudnyk: Perfect. Yes. No, no, no-
Kurt Elster: Which goes live first? Your app or this episode?
Andriy Rudnyk: Yes. Which, who knows? But I’ve got a good feeling.
Kurt Elster: Yeah. It’s a gamble, but we’ll see. All right, Andriy, this has been excellent. Thank you so much. I appreciate your time as always.
Sound Board Clip:
Andriy Rudnyk: Thanks for having me on again, Kurt.