MarTech Podcast ™ Episode Summary
Title: Are Subscription Models The Best Pricing Strategy For DTC Brands?
Release Date: January 23, 2025
Host: Benjamin Shapiro
Guest: Kelly Thornton, Founder and CEO of Tiege Hanley

Introduction to DTC Subscription Models

In this insightful episode of the MarTech Podcast™, host Benjamin Shapiro delves into the burgeoning trend of subscription models within Direct-to-Consumer (DTC) brands. Kelly Thornton, the innovative founder and CEO of Tiege Hanley, joins the conversation to unpack whether subscription pricing strategies are indeed beneficial or simply a fleeting trend.

Key Topics Covered:

• The viability of subscription models for DTC brands
• Benefits for both brands and consumers
• Challenges and solutions in managing subscriptions
• Best practices for implementing flexible subscription systems

Subscription Models: A Trend Worth Embracing

Kelly Thornton kickstarts the discussion by affirming that subscription models are a "trend" rather than "trash" when executed correctly. She emphasizes the mutual benefits such models offer:

• For Brands: Provides a steady revenue stream and enhances business efficiency.
• For Consumers: Offers reliability, convenience, and cost savings.

Notable Quote:

"If done correctly, it's great for everybody, it's great for the consumer, it's good for the brand... it's super convenient for them."
– Kelly Thornton [01:55]

Thornton highlights the importance of flexibility in modern subscription services, allowing customers to "pause," "change addresses," or "cancel" with ease. This flexibility not only enhances customer satisfaction but also fosters loyalty.

Balancing Recurring Revenue with Customer Convenience

Benjamin Shapiro introduces a critical perspective by presenting potential pitfalls of subscription models from a consumer standpoint. He shares a personal anecdote about managing subscriptions, illustrating how misaligned delivery schedules can lead to excess products and customer frustration.

Notable Quote:

"Every time I've had a subscription... I have two extra bags... I need to go online and manage my subscription."
– Benjamin Shapiro [02:47]

This commentary underscores the necessity for DTC brands to prioritize user-friendly subscription management to prevent such inconveniences.

Implementing Customer-Centric Subscription Management

Kelly Thornton responds by detailing Tiege Hanley's approach to subscription flexibility. She stresses the importance of "putting yourself in the shoes of the customer" and minimizing the effort required to manage subscriptions.

Notable Quote:

"Figuring out ways to make it as absolutely painless as possible for customer to manage their subscription is the name of the game."
– Kelly Thornton [03:45]

Thornton contrasts her company's strategy with cumbersome systems like that of the Wall Street Journal, where cancellation processes are intentionally complex. Instead, Tiege Hanley opts for a straightforward notification system:

"We notify everybody and say, hey, your orders are coming up in three days. Let us know if you want to pause, change or otherwise cancel."
– Kelly Thornton [05:06]

This proactive communication ensures customers have ample opportunity to adjust their subscriptions without hassle, thereby enhancing the overall user experience.

Innovative Solutions for Subscription Management

Benjamin Shapiro suggests an ideal system where customers receive a prompt before their subscription renewal, allowing them to "confirm or cancel" with a single click. However, he acknowledges the challenges in implementing such seamless systems without risking customer attrition.

Notable Quote:

"I wish there was a system that was easy where it was a check with me. Hey, your subscription's coming, click here to confirm or cancel..."
– Benjamin Shapiro [04:50]

Kelly Thornton reveals that Tiege Hanley already employs this customer-friendly approach, prioritizing transparency and ease over rigid subscription terms.

Conclusion: The Future of Subscription Models in DTC

As the conversation wraps up, both Shapiro and Thornton concur that subscription models, when designed with the customer in mind, are a powerful tool for DTC brands. They offer reliable revenue streams for businesses while providing consumers with convenience and value.

Final Thoughts:

• Emphasize simplicity and flexibility in subscription management.
• Maintain open communication with customers regarding upcoming shipments.
• Strive to align subscription terms with actual consumer usage patterns to avoid overstocking and dissatisfaction.

Closing Quote:

"My advice is to just focus on keeping your customers happy."
– Benjamin Shapiro [06:38]

Connect with Kelly Thornton and the MarTech Podcast™

For more insights from Kelly Thornton, visit her LinkedIn profile or follow Tiege Hanley on Instagram @TiegeHanley and their website teege.com. Interested in being a guest on the MarTech Podcast™ or seeking marketing and technology strategies? Visit martechpod.com and subscribe to stay updated with daily marketing wisdom.

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