How to automate text messages to boost LTV and reduce churn

It is no secret that technology is changing the lives of people everywhere. With respect to ecommerce, day to day routines have drastically improved. Grocery shopping can be accomplished sitting on your couch using an app, learning new skills is as easy as taking an online course, even the simplest things like getting your morning smoothie can be automated so customers don’t even have to think about the process anymore.

Since 2017, subscription ecommerce has grown by 800%. But why do online shoppers sign up for subscriptions from their favorite brands? Instead of making customers log onto a website, search the store for their desired products, add those products to a cart, input a credit card… Brands can lift that burden with a simple subscription plan. Customers will stick with you because it’s convenient, it promotes brand loyalty, and the price is just right.

smoothiee box subscription
Smoothie Box delivers smoothies on a recurring plan. They offer delicious smoothies using a 3 step how-it-works system and an option to choose the subscription plan you prefer.
  • Convenience: It’s much easier for customers to receive their products periodically when it comes to replenishable goods like food, cosmetics, or personal care items. Consumers love to subscribe and get products every week or month, instead of purchasing the same things over and over again.
  • Customer Loyalty: Knowing that you can count on a brand to keep your most vital items coming when you need them drives great brand loyalty. One-time purchases are easy to forget, customers are much more likely to stick around and recommend your brand when you consistently have their attention.
  • Affordability: Subscription payments are easy to digest, they are plannable and predictable. It’s is much simpler for customers to stop thinking about what they need to buy, while leaving payments on autopilot to stay within budget.

With all these benefits, you’d think subscriptions are a magic bullet! But every business solution creates new challenges. For recurring subscriptions payments, one of the main challenges is retention and customer churn.

So the question becomes: How do you stay on top of the competition in the subscription-based product sector?

Let’s take a look at one of the fastest growing retention and lifetime value (LTV) channels for ecommerce in 2019: text messages.

How does SMS help prevent churn?

Text messages can be the vital touch point your subscription business needs to keep customers engaged. SMS automations can be used both as a precaution and solution against churn.

Recover Voluntary Churn

SMS automation can help recover the customers who churn voluntarily by automating a cancellation text message with an enticing option to renew their subscription.

This text message automation can be crucial since most purchasing decisions of customers come down to price. If your subscriber wants to cancel their plan but gets an offer from you to continue at a lower price, you’re much more likely to change their mind and keep that customer.

Even if they’re cancelling because they found a better plan with one of your competitors, sticking with you for a lower price will also save them the time of switching, not just the cost.

text message subscriptions

Prevent Involuntary Churn

One of the main reasons for growing churn rates for merchants is the fact they don’t send out enough notifications and warnings for upcoming payments.

Text message reminders are a great way to give customers heads up so they don’t entirely forget they subscribed for your product, or take the necessary action to be capable of submitting their next payment. This is one of the biggest strengths of SMS, the instant ability to remind and notify customers of their upcoming orders.

text message subscriptions

Benefits of using SMS compared to email

Inboxes can get stuffed and ignored, but text messages are highly visible due to the fact that most people have their phone on them all the time. SMS gets 98% open rates, which makes it a great solution to notifications and reminders that demand the customer’s attention right away.

Let’s mention that again… 98% OPEN RATES FOR SMS!

This means that every single customer is likely to see, open, respond, and react to your message. Just imagine the engagement with your entire audience where all customers see and respond to your brand’s messages.

Let’s say you want to notify a customer about an upcoming payment or cancelled subscription. Your email is sent, but they’re either offline, or don’t notice it right away.

What happens next? They either see it too late and the subscription has been long cancelled and forgotten, or the email just gets lost in the inbox.

With text messages you don’t even need an internet connection to receive them. Furthermore, the notifications you get for a text are much more distinguishable and noticeable than most other smartphone updates.

Once the customer sees the text, the message is conveyed instantly and they’re ready to prepare for the upcoming payment, renew their subscription, or take other required actions.

SMS automation hacks for subscriber retention

You’ve probably been using emails for your marketing notifications to grow your subscription business in Shopify. Here are a few ways to supplement that growth using text messages.

Upcoming charge reminder

This is what it’s all about. Keep those subscribers close, keep them notified and engaged. Since one of the main problems of subscription-based business is the lack of proper notifications, now you can solve that with one of the simplest solutions available – texts.

A single text message reminder a couple days before the payment gives the customer confidence that their plan is running smooth and they can trust your brand.

This makes SMS arguably the most effective method of communicating short and quick messages that are time-sensitive for the ongoing relationship between your brand and your customers.

text message subscriptions

Abandoned subscription reminder

That checkout almost went through, but not quite? So close! Using SMS, you can automate reminder the same way you do with abandoned cart emails.

Recovery rates of SMS have gone through the roof both with subscription stores and one-time purchase products. Since texts are one of the most personal communication channels, you don’t just recover sales, you start a conversation and build loyalty through engagement.

text message subscriptions

Successful subscription notification

The customer signed up, congratulations! An automatic confirmation message notifies the customer that their subscription has been activated successfully. This kind of touchpoint gives an instant sense of completion and lets the customer breathe easy knowing everything is taken care of.

In case the customer has further questions about their plan, they can simply text you back from the same confirmation message and start an SMS conversation with your brand.

text message subscriptions

Cancelled subscription alert

So, a customer cancelled their subscription, no need to panic. One more text message notification you can automate as a final touchpoint from your business to the leaving customer.

What’s important here is to let the customer know that what has been done can be easily undone and they can jump back on their plan effortlessly.

Turn the lost customer into a future opportunity and make one last attempt at convincing them to stay. Once again, good communication can fix the most damaged relationships and bring back even the most unhappy customers.

Even if the last text message notification fails to convert the customer back, at least they will have the confirmation that they need from your business to know things are complete.

text message subscriptions

Keep the conversation going

Retaining your customers requires your business to be proactive and engaging using multiple touchpoints. After all, we’re humans, and the lack of communication can destroy customer relations.

In addition to email, businesses need to add more channels to make sure they reach enough of their customers to keep the conversation going. That’s where text messaging meets the perfect balance between lightning fast, personal, and branded communication.

Brands like Smoothie Box using SMS notifications have noticed a huge rise in their revenues from subscribers who now stay longer and add more products to their subscriptions. Start increasing the number of customers who sign up to get deliveries from your brand by using text messages to keep them engaged.

Download SMSBump to better engage your users and see how text messages can boost your subscriber LTV.