132: 10 Truth Bombs to Understand About Your Subscription Box Business

Have you been struggling with your business this year? Most of the time our business only needs a little tweak to change everything. I've got 10 truth bombs that will have you looking at your business differently today. Grab a notebook and come join me.

Welcome to the Launch Your Box podcast with weekly tips, tricks, and strategies to start, launch, and grow your subscription box. Now here's your host, Sarah Williams.

Welcome back to another great episode of the Launch Your Box podcast. Now there's a saying that goes around in my community, and kind of when I get on my little soapbox or my TED Talk, or when I just tell it like it is, sometimes around my community they call that my ranty pants. Like I put these ranty pants on and I just give you the truth bombs like it is. And sometimes you really need to hear it. And so today we're talking about 10 different truth bombs to understand about your subscription box business. And some of them are going to feel a little ranty because I need you to understand it. You know, I think about these kind of conversations like I'm having a conversation with my kids, right? You can tell your kids things over and over and over again, and they just don't— sometimes they don't listen. But when you really get stern, maybe you raise your voice just a little bit, they stand up and listen. I need you to listen today. So if you typically listen to me while you're working on other things, maybe put that down, maybe go for a walk. And really get your mind in a place where you can listen to me today, because I'm going to walk you through 10 different talking points today that I really need you to take to heart about your business. Because here's what's been happening, and I've been seeing this a lot in our community, Launch Your Box and Scale Your Box, and even my mastermind lately, is that we're struggling. We're struggling with some things. And whenever we struggle with some things, we panic and we start to do things that we know we shouldn't be doing because we're in a panic state with our business. And so I need you to write these things down. I need you to listen to these things today. I really need you to take them to heart today because they're not just like a check it off the list kind of things. These are things that we need to be understanding about our business to operate the most efficient way that we can. I want everybody listening to this podcast episode to leave this episode with takeaways, and I really, really want you to have a thriving business. And so I need you to understand these things. So we're going to get into it. We're going to talk about it. I'm going to give you examples. And hopefully when you leave this episode, when you're done listening to this episode, you're able to put a different view on your own subscription box business. All right. So let's get into it. Number 1, we're going to go through 10 things, 10 truth bombs to understand about your subscription box business. Number 1, 20% of your customer base generates 80% of your revenue. Let me say it again. 20% of your customer base generates 80% of your revenue. Stop trying to please everyone. It's not serving you. It's making you exhausted. How many things are you doing right now for a handful of people that are consuming a lot of your time and energy? Is what you're working on right now in your business a good use of your time? If I looked at the top 20% of my customers and did everything that I possibly could for that top 20%, how would that make a difference in my business? I need you guys to stop trying to be for everyone. Stop getting in your DMs and people pleasing. Can you make this one for me in a different color, in a different design, with this instead of this? Can I get this one in lavender instead of fuchsia? Can I, can I get it in this link instead of this link? Whatever your business is, every one of us listening has those customers. And a lot of times we're like, sure, let me find that for you. And then I'm going to go buy a whole run of lavender tops for one customer and the rest of them are going to sit on my shelf. I'm going to make a custom design for someone and it's going to take me half a day and it's going to squirrel me from doing other things. For the other 80% of my revenue. Stop spinning your wheels in too many different directions. We've got to say no. It's going to bring back so much sanity to your life and it's going to stop the burnout that we've been experiencing for years. We saw it in 2020 and we all hustled our faces off and we were exhausted by the time we got through 2020. And here came 2021 and we thought, okay, this is going to get better. This is going to get easier. And it got harder. Supply chain got harder. Customers got harder. Sales got harder. Then in 2022, we did more of the same stuff that we did in 2021. We've just been dealing with so much stuff. We don't even realize what we've been through. Business owners are more burnt out than ever before, and it is not serving us. We cannot be all things for all people. I want you to get rid of the 80% of the crap that we no longer need to be doing. Take a hard look at your business and ask yourself, why am I doing this? Am I doing it for the one-off person? Am I doing it because I've always done it? Why are you doing it? 20% of your customer base generates 80% of your revenue. Stop jumping through hoops for everyone. It doesn't serve us. Okay? It's me giving you permission to stop it. I don't want you burnout. I don't want you throwing in the towel. Number 2, and it goes hand in hand with number 1, protect your peace and energy at all costs. If it's no longer serving you, let it go. If it makes you mad every time you have to do it, stop doing it. I used to get so mad when I would get— I would have a whole bunch of orders and I would batch make them and, and then I get this one-off order that someone had to be super specific and wanted a different way. And it just would make me mad and I would sit there making it mad. And I'm like, why am I doing this? We don't need to continue doing things if they're no longer serving you. What are you spending time on daily and why? Protect your energy. But also we've got to protect our peace. How many times have we let negative reviews, a cancellation, a tacky comment on social media affect our whole day? We've got to protect our peace. Do you know that we can quit them the same way that they can quit us? We can quit our customers the same way that they can quit us. Never in my life have I had negativity on social media ever. I've been in business 10 years, and over the last year I have had this one subscriber, and it amazes me that I can just never please them. Every month when I talk about the box, do the box reveal, she will post a negative comment about what she's not happy with and what she doesn't like about my box. Every single month. And I finally snapped because every month it would just affect me. I finally snapped and I said, you know what, I'm going to call her. I'm going to call her Heather just because I don't want to call her Karen. You know what, Heather? I don't think this subscription is serving you any longer. I am canceling your subscription effective today. You can now purchase whatever you'd like inside the shop and that way you'll be happy and I know you'll be happy and you don't I don't have to be upset about every single box. I quit her. I canceled her subscription. Her $60 a month was not worth the crap that I have put up with from her. It was taking my energy. Not only was it taking my energy, but it was taking my customer service person's energy that had to deal with her every single month. And her negativity was popping up on all of my subscription boxes. Posts on my social media. Her $60 a month was not worth my peace. I want you to protect it at all costs. If sometimes that means we have to hire someone to take care of our customer service inbox, think about what's stealing your peace and your energy in your business. Let's hire someone to take that over for us. If it's no longer serving you, let it go. Protect your peace and energy at all costs. Number 3, fad marketing strategies are like fad diets. They won't last. They will not last. Consistency is king, and it will trump all the fad marketing strategies out there. You know what I'm talking about? Probably every business owner's social media feed has some marketing genius guru in their feed claiming that this is the next best thing to sell products or to get people on your list or to make more money, right? All we need to do is be consistent. That's all we need to do. Consistency is king. You don't have to be the best. You just have to be the most consistent. And I'm talking about social media a lot because I want you to enjoy social media. I want you to do things on social media that you will enjoy so that you will be consistent with it. Social media needs to be social, and it's amazing, and it's fun, but so many of you hate it. You loathe social media. But I want you just to get consistent with a few things that you like about social media and really enjoy what you're doing. There's no better way to get in front of your ideal customer than social media. I love connecting with my audience. I get to interact with my customers, not I have to post today. I need you to flip your mindset around social media and stop trying to do just any little thing that anybody tells you works. Y'all know what works. Go back to the basics. Be consistent. Fad marketing strategies are like fad diets. They work for a short period of time and then They don't. Number 4, companies or brands that have heavily relied on paid traffic only have been shifting to organic traffic in droves this year. Last year we saw iOS changes, which has increased our ad cost tremendously. And every quarter, every 6 months, I can see a shift in it every single time. It's never going to get better. Gone are the days of 2018 and '19 Facebook ad costs. Gone are the days. And companies that relied heavily on paid traffic back then are now realizing that they can't afford to only focus on paid traffic because it got so expensive and their profits decreased tremendously. You're spending more with less results. I'm a firm believer that you need paid and organic traffic to have a successful business. You will be on a constant rat race if you rely only on paid traffic going forward. Organic traffic just means customer connection, compelling content, user-generated content. We need to have content that's engaging for our customers. It's more than just product selling. Let's get organic. Let's build a balanced traffic channel. We cannot solely rely on paid traffic, and companies that have done that over the years are feeling the crunch. Number 5: Systems and processes will serve you. We have to get more efficient with our everyday workload so that we can open up some of this white space in our calendar and in our daily schedule for us to grow. I'm not necessarily talking automations, but it's how we create routines, templates, systems, and processes so that we can be more efficient. And this is true for the solo entrepreneur. And this is also true for people with teams. If we're constantly in the rat race of the everyday business tasks, if we just go to work and we're constantly tasked out every single day, we have no space to think creatively or to think big picture. And when we can't be creative or we can't look at the big picture, we are constantly putting out fires. And this could look different for different people. It could be hiring, but it also could mean just streamlining your own systems and processes so that you can calm the everyday chaos. I want you to think about how we can create routines, templates, and systems, different processes for the things that we do all the time. Think about what you do daily. Think about what you do weekly. Think about what you do quarterly and what you do monthly. I said that backwards. Think about monthly, quarterly. Okay. Daily, weekly, monthly, quarterly. Let's get some systems in place. Let's get some routines in place. Let's get some templates in place. So that we're not recreating the wheel every time we're doing the same task. Systems and processes will serve you. All right, number 6, spoiler alert, revenue does not mean profit. Revenue is such a vanity number, and I have learned this over the last couple years, that you could have a million dollars in sales last year and have so little profit. It is mind-blowing to me. Like, people that have these 8-figure businesses, and I'm like, God, they're just doing so amazing, and I realize that I have more profit in my business than they do. Focus on your profit. Do you have a profit goal, or do you only have a sales goal? You could have $2 million in sales this year and still be broke. And if you feel that in your soul, we need to work on our profit goal. People with these really large businesses have such a thin profit margin. They have to have thousands and thousands of subscribers to be profitable. We don't. If we will focus on the profit right in this, at the start of our business instead of sales, we are going to have money in the bank, have better cash flow, and we don't have to worry. Wouldn't you rather have money in the bank than hit a 7-figure sales goal? I would. Revenue does not mean profit. Make sure our profit is on point. We can be profitable every single month. We can be profitable with 50 subscribers, and we can be profitable with 5,000 subscribers. Stop focusing on the revenue goal. And this goes hand in hand with number 7. Cheap is not creating value. People will spend money where they see value. Cheap isn't loyal. Cheap is going to bounce from shop to shop to shop looking for the cheapest price, the best price, the lowest price. Your subscribers want quality over cheap. Why are we going after cheap customers? And I'm not necessarily talking about the products, although we do want great quality products, but I'm talking about the experience, the quality, the packaging, all the things that are wrapped up into our subscription box business. That's the value that creates the longevity of a customer. A cheap customer will never be loyal. The loyal customer will create a much higher lifetime value than a cheap customer ever could. Your cheap customer will churn every time. And this is why I hate giving a discount on the first box, because if we do a 50% off your first box or a $15 off your first box or whatever that is, they came for that first box because they're cheap and they're going to get their first box and they're going to bounce, or they're going to get 1 or 2 or 3 boxes and they're going to bounce. The customer that really wanted your product, that was willing to pay full price for your product, that didn't use a coupon coupon or a promo offer to get your profit— your product will have such a higher lifetime value for your business, and you will retain them for many, many more months than the customer that came in on a 50% offer. Cheap is not creating value for your business, and it's also not creating profit. Why are we going after cheap customers? Erase that from your mentality. Cheap is not creating value. 6, 7 tie into 8. Number 8: it's more profitable to retain your subscribers than to acquire new ones constantly. Now hear me say, we are always talking about acquisition and new traffic and new customers, but we are so focused on acquisition that we forget about retention. We are so focused on acquiring that new subscriber that we forget about the ones we already have, those loyal subscribers that have been with us for months and years. I want you to get super intentional about surprising and delighting your existing subscribers. I have a great resource for you today. So grab your phone and I want you to text me. So grab your phone real quick because I know you won't go back and do it after this podcast episode is over. So grab your phone, open up your texting app, and text me. My number is 940-204-0023. If you missed it, rewind 10 seconds. Text me the word surprise. I have got a PDF download for you, 10 ways that you can surprise and delight your customers. We need to get super intentional about making them really excited about being a subscriber. We need to be super intentional about the connections that we're making, making them feel important, making them feel like we appreciate them. We spend more money acquiring than we even think about how could we spend some of it to retain. It's way more profitable to keep them than to constantly going after that next new subscriber. Let's get intentional about retaining our subscribers. Do you know your retention percentage? If you don't, you need to be knowing that every month. How can we increase that by a percentage every month? That should be your goal. All right, number 9: what gets you started may not get you to scale. The things that we do to start and launch our business may not work to get us to scale. We need to continue to do those things as long as they're working, but we've got to test and try new things. I don't want you throwing everything out the window because remember, consistency is king. We've already talked about that. We need to maintain some consistency with what's working, but we also need to get creative and change things up. You cannot continue to do everything you've always done if it stops working. I battled this in the first year of my subscription. I launched my subscription, I had 44 subscribers, and I went through this growth period of 9 months. Went from 44 to 75 to 150, and I got up to over 300 subscribers in the first 9 months. It was great, and then I plateaued. And I thought, I just have to keep doing what I'm always doing. And I did that for 6 more months, spinning my wheels, trying to keep doing the same thing, hoping for different results. I got consistent with what was working, but I also started to test and try new things. What worked to get us our first 100 subscribers may not work to get us to 1,000 subscribers. We have to go deeper. We have to understand our numbers at a different level. We have to have a multichannel marketing plan. We have to take customer service to the next level. We have to continue to get better and market differently and retain better to get us to scale. So I want you to remember what gets you started on your subscription box journey may not get you to scale, and that's okay. Just don't go down doing the same thing over and over again if it's not working anymore. We got to change it up. All right, number 10, last one and probably the best one: if you don't challenge yourself, you won't change yourself. How many of you listening right now are stuck in a rut with your business? Maybe you've kind of been stuck at the same place. Maybe your subscriptions are dwindling. Maybe you feel like you're just not making any traction. I guarantee there's a lot of you that feel this way. I've been seeing it in the community. Personal growth and business growth go hand in hand, and you need both to grow your business. You've got to challenge yourself. If it doesn't scare you, it won't change you. I want you to do it and do it scared. When we get out of our comfort zone, amazing things happen. But right now, if you're living in your comfort zone, because you're like, this is what I know how to do, this is what I'm comfortable doing, you will never get to the next level. If it doesn't challenge you, it won't change you. I need you to pull yourself out of the comfort zone. I need you to do something that's scaring you right now. And I'm going to push you to take that next scary step. And here's what else I need you to do. I need you to stop the negative talk. I need you to stop telling yourself you're a failure. I need you to stop telling yourself it won't work. I need you to stop telling yourself that you can't do this. I would guarantee every single person listening to this podcast right now, including myself, has told themselves one of those things at any given time. During starting their business and growing their business. Do you know how many days I've wanted to give up and I tell myself, this is not worth it, I am crazy, why am I killing myself for this? And I also follow that conversation up with just one tweak to what I'm doing could really explode my business. So I might have that negative talk in one ear and then I have the entrepreneur talk in the other ear. I want to be successful. I want to grow this. I want to wake up and get to do what I love to do every day. I never want to have to go back and work for somebody else again. So I've got to push through whatever's holding me back right now. I need you to challenge yourself. My goal is to help you with that. My goal is to help you with all 10 of these things and to help you make progress on these things. We have focused all of our training around these 10 things this year. I want you to really set with this, really listen to this, maybe listen to it again in a couple of days. Why are you doing what you do? What do you love about it? What do you hate about it? How can we change to make it better? Keep stepping one foot forward in your journey. The journey doesn't ever end. The destination is never there. We're never stopping. It's always a work in progress. But if you could take one of these 10 right now and really dig into that, it's going to propel you to take another one and another one because so many of them are linked together. We've got this. Don't give up. Don't quit on yourself. Push yourself to really understand your business, and let's keep trying. Being an entrepreneur is an amazing thing, and I know you can do it.