Matt Mullenax, Co-Founder & CEO at Huron, understands how important it is to be there for your customers. Since Huron carries personal care and skin care merchandise as a subscription, it’s crucial for customers to have enough—but not too much—product on hand. One of the challenges of a subscription model is knowing when your customers will need to order more product. But if you know how to manage shipment timing well, they’ll always have the right amount. On this episode of Subscription Radio, Ben and Matt discuss ways to manage subscription timing, the importance of an authentic brand voice, and the pros and cons of using Amazon.
- Manage subscription timing
- Use survey data
- Foster long-term relationships
- Focus on your core values
- Let your brand evolve
- Take advantage of opportunities
- Make the most of your channels
- Humanize your brand
- Keep moving forward
- Check out Huron
- Connect with Matt Mullenax on LinkedIn or Twitter
- Check out Rodeo
- Connect with Ben Fisher on LinkedIn or Twitter
4:21 – Manage subscription timing
One of the challenges of a subscription model is knowing when your customers will need to order more product. if you manage the timing well, they’ll always have the right amount.
“We know by sku what the typical replenishment rate is on a median base, on an average base, et cetera. And we've set our auto-delivery, replen rates default to 30 days but are very upfront and proactive in the communication beforehand. So there's a three-day notification. There's a day-before notification. So we're giving people an opportunity to postpone a week, postpone two weeks, skip this month, et cetera. But what we wanted to do was not miss that window, because at the end of the day it's very difficult to determine the discrepancies and usage and throughput rates. We were chatting before this, you could be a trainer at your local gym and shower at your house three times a day, and maybe you're going through stuff every two or three weeks. Or you could be a consultant and be on the road for five days a week, and you're going through this stuff every two months. So we don't want to miss the window on the former and we don't want to annoy the latter. So what we try to do is, again, default to that 30 days, but be super proactive in our communication efforts to say, ‘We just want to make sure that you have what you need. We're not here to annoy you. If you need to skip, go for it. You determine the iterations that we skip or postpone.’”
6:23 – Use survey data
If you send out surveys regularly, you’ll have more data to help you figure out how and when your product is being used.
“We’re sending a survey a quarter, and it's very segmented. So we have thousands and thousands of data points in and around not only usage rate, but also professions, activity level, et cetera. I still think at the end of the day a dispensing of a body wash amount can still be subjective literally on every shower. So that's why the jumbos have actually performed really, really well, because there's more of a better understanding, at least on our end, around projected throughput rate. But when someone buys a jumbo, they could be buying it for themselves or they could be buying it for their family of four. Again, it's very hard to determine some of these things. So I think the position that we've taken and drawn the line of the sand around is we want to solve for not missing that opportunity to replen with the mindset of ultimately putting the customer first. So not annoying that customer. We wouldn't, as customers, wouldn’t want to receive 15 emails around, ‘Hey, you ready to reorder? Reorder here, do this.’ Or conversely making it impossible to cancel or postpone. So now all of a sudden you have 16 months’ worth of shampoo built up in your linen closet. That's a horrible experience as well.”
8:54 – Foster long-term relationships
A lot of companies focus on getting new customers in, but if you want to cultivate sustainable growth, prioritize building long-term relationships with customers.
“I think a lot of our flows are in and around trying to get people in the fold on a quarterly basis, because that's how we think our throughput usage rate. I mean, that should be very much in line for someone to re-up, but, but yes, to your point, we want to make sure that the customer's ready for the next shipment and we're totally fine skipping, postponing, what have you, to foster that better long term relationship. Historically this has been a very, no pun intended, sticky category where this guy might be a 10- to 15- to 20-year Old Spice or Dove For Men user who has entrusted us with his wallet and his personal care routine. So if we roll out the red carpet to that customer, we could in theory have a 5- or 10-year customer, which is super, super exciting for us. So it doesn't make sense to push super hard to the point where at day 75 this customer's churning because we're the annoying body wash company.”
16:11 – Focus on your core values
Huron’s emphasis on retention is in its company DNA. Whatever your company values, make sure you prioritize those principles.
“We've had a pretty big emphasis around retention really from time zero, we've crafted this mantra internally around ‘Finish line first,’ which again if we're fortunate enough to get a customer to join the Huron journey after switching from one of these mass-market products from a decade's worth of use, how do we make sure that they stick with us? So even in this crazy economic cycle where interest rates are increasing and whatnot and people are crying about Facebook and attribution and all this stuff. There still exists the other side of the equation, which is folks who are already your customers. And I think that's where the lion’s share of our attention has been since we launched. So, yes, while we're still facing all of the noise and headwinds that the rest of the industry is facing on the acquisition side, a lot of our efforts to date have still been deployed on the other side of the equation. And I think that's allowed us to tap into that base, to get to know our customers better, and being more of a business decision from the onset versus like, ‘Oh wow. The macroeconomic climate's throwing us a curve ball.’ Let's focus on retention. That's really been part of our core DNA.”
20:48 – Let your brand evolve
Your brand will grow and change over time. It’s important to let your brand mature naturally so you can find an authentic voice.
“We’ve gone through some iterations as brands do of, less on visual aesthetic, I would say more in tone of voice and speak. I think for us, pushing pause on the word authenticity because it's the worst buzzword in D to C. We like to say relatable. I mean, we've been there. I was the kid that grew up with bad skin. This has not historically been a fun category to talk about. Usually, it's pretty awkward. There is a lot of problem-solution in this category. My hair is thinning, I have really bad BO, I have acne or blemishes. These aren't really dinner table conversations. So for us crafting this voice to create a very open dialogue with the brand and almost wearing the awkwardness as a brand on our own shoulders creates a little bit more of a comfort level with customers to ask these questions. And that's what we really like, and that's where we thrive. So that's definitely been an important point of the brand maturation process if you will, is just the evolution of speak.”
23:36 – Take advantage of opportunities
While the pandemic had a lot of downsides, it helped some companies reach a larger audience. Always be prepared to jump on new opportunities.
“I think one opportunity that's presented itself, that's again probably not just a tailwind of ours, but COVID was probably a net positive in terms of business momentum for a lot of personal care and grooming categories. I’m not saying COVID was a good thing, it was a horrible thing. But I think as people were in their apartments, in their homes, they began to self-reflect around what am I eating every day? What am I drinking every day? What am I actually using in the bathroom? Is this the best product? And I think it was a natural time for people to push reset, experiment, et cetera. And I think a lot of the brands that were well suited to position themselves, make themselves accessible, be in a few different distribution channels. It was a really positive time in business growth.”
27:11 – Make the most of your channels
Different channels all have upsides and downsides. The most important thing is knowing how to use them.
“There are certainly some downsides. I mean, Amazon is a behemoth, and at times working with them can be difficult. There are certainly elements where we certainly wish we had customer emails of who's buying this stuff. But again, even if we were to turn on a massive wholesale account, we wouldn't know that customer's email either. So, I think there people view Amazon in an unfair lens through which they don't view traditional wholesale. It's like, ‘Oh, you don't have any customer information.’ Well, you don't have any customer information from a large wholesale account either. So, what's really the difference? So, certainly points of friction, of course, but for us it's been a really efficient and a really strong scaling channel.”
29:36 – Humanize your brand
Conversion rates aren’t always great. It’s better to focus on humanizing your brand so you attract customers who will want to stick with you.
“We banter around internally that baseball and email are the only things in the world where you celebrate a 33% success rate. So for a conversion rate, obviously it's a fraction of that, so just figuring out how do we get more people not only exposed to the brand, but then understanding how we can talk to them and communicate with them about the brand in a way that would ultimately resonate at a personal level. We don't want people just buying face wash. We want people buying from Huron because they feel like they're a part of the journey, because they feel like they understand the brand, because they feel like the brand resonates with them at some level. I think a lot of our efforts are in and around the humanization of brand. This is not just a millennial pink brand that has thrown a bunch of stuff in a tube that hopes to make money off your first purchase. We want you to be a lifelong customer of ours.”
32:49 – Keep moving forward
There will always be challenges to face. The important thing for your brand is to keep testing and experimenting to find the best path forward.
“I think there's been a lot of emphasis over the past few weeks in and around, ‘Oh, the acquisition world is melting. What are we going to do?’ Immediately we are in cash conservation mode. There's a lot of other areas of focus that can command your attention that are going to continue to move the ball forward and the business forward if given the right amount of thought. So it could be from the retention side of things. It could be in and around site testing at an extremely granular level. And we're not talking about ‘Is the add-to-cart button red versus blue?’ But it's like, ‘Are we swapping out Homepage Hero for these three products and pushing the purchase opportunity higher in the funnel? How does that compare or test against status quo?’ So there's a lot of micro-testing that I think a lot of brands can and should be doing that I don't know if they are. And I think, again, that's a way to continue to move the needle in a challenging acquisition environment. So how are you continuing to create a really positive customer experience and making the most of those experiences? Because maybe they're fewer and further between than maybe what they were otherwise in a super healthy acquisition environment.”