Using Recharge’s Rewards Module to Prevent Churn & Increase Subscriber Loyalty
Tangible, meaningful rewards can go a long way in maintaining subscriber engagement. Find out how Recharge users can leverage the platform’s native rewards functionality to discourage customers from churning and boost subscriber loyalty.
Written By
Hannah Smiddy
As the ecommerce space becomes increasingly crowded and acquisition costs continue to spiral, investing in customer loyalty and retention remains a priority for DTC ecommerce retailers.
Rewards programs are frequently used by traditional brands to foster long-term loyalty, with a focus on encouraging customers to make another purchase.
For subscription brands however, whose customers are already committed to recurring orders, loyalty programs should have a different focus: dissuading customers from churning. In this case, rewards should be used to boost customer satisfaction, make subscribers feel valued and persuade them to stay subscribed.
This article explores how Recharge’s Rewards module has been engineered to do exactly this. It examines the module’s key features and how each of them can be used to prevent churn and increase subscriber loyalty.
What is Recharge’s Rewards module?
Recharge’s Rewards module is part of the platform’s Retain package, an advanced suite of loyalty and retention tools designed to extend subscriptions and maximise customer acquisition spends. The module is a paid add-on for Pro & Custom Recharge plans.
Put simply, Rewards enables retailers to build targeted strategies that keep customers engaged and retained.
As of December 2024, Rewards offers three main tools to keep subscribers from churning:
- Credits
- Free gifts
- Subscription discounts
These clear, meaningful rewards create an immediate sense of value for customers, and have been developed by Recharge in response to the pitfalls of traditional, one-size-fits-all points systems.
Rewards can be contextualised, based on customer actions and behaviours, to make customers feel special – and further compel them to stick with their subscription.
We will now explore these three rewards strategies in more detail.
Leveraging credits to increase subscriber loyalty
Recharge users can reward subscribers for their purchases with fixed cash value or percentage cash back credit options. These credits can grow as customers spend more – making each purchase more rewarding. Credits can be cashed in instantly, or saved up over time.
Some of the ways in which credits foster loyalty include:
- Providing tangible value for subscribers – Credits offer a direct, measurable benefit that creates a perception of value and boosts customer satisfaction.
- Creating a ‘sunk cost effect’ – As credits accumulate and perceived value increases, churning becomes less appealing for fear of losing out. Credits act as a financial incentive for staying subscribed.
- Illustrating your appreciation – Rewarding subscribers with credits shows that you value their custom. Recognition and appreciation lead to stronger emotional ties, which help to foster loyalty.
- Adding an element of fun – Credits can introduce gamification and excitement into the subscription experience, motivating customers to stick with their subscription.
Surprise & delight subscribers with free gifts
Providing free gifts is a simple gesture that can have a big impact. Receiving a surprise bonus item with their subscription delivery is sure to delight customers, making them feel valued and appreciated. This can contribute to stronger, more meaningful brand-consumer relationships, which helps to foster long-term subscription loyalty.
Linking free gifts to special occasions like a subscriber’s birthday is a great way to further reinforce relationships and ensure that customers associate your brand with positive experiences. Meaningful gestures like this make it less likely that a customer will churn in favour of an alternative brand.
Furthermore, tailoring gifts based on a customer’s on-site behaviour, preferences and purchasing history is an effective way to maximise the impact of this particular rewards strategy. You can read more about the benefits of a targeted approach in our article on the ROI of personalisation.
The Recharge Rewards module allows subscribers to pick between gifts, selecting between flavours, colours, sizes and more. This goes a step further in showing customers that you value their experience with your brand.
As well as the benefits around subscriber loyalty, providing free gifts is a great way for retailers to showcase new and complementary products in the form of samples. This aids product discovery for current customers, and can eventually lead to increased average order value.
Using discounts to prevent churn
Another way that Recharge enables retailers to reward subscribers is through the offering of discounts. This is a versatile strategy that can reinforce customers’ commitment to a brand and produce long-term advocates. Here are some of the ways that discounts achieve this:
- Creating a sense of exclusivity – Receiving discounts can improve a customer’s experience in an instant, fostering a sense of exclusivity. If customers feel special, like they’re part of a VIP group, they’re more likely to stay loyal.
- Making customers feel valued – An unexpected discount can foster a sense of appreciation amongst subscribers. This helps to strengthen their emotional connection with your brand and dissuade them from cancelling.
- Associating churn with ‘FOMO’ – Discounts compel subscribers to stay engaged, so that they can actually put their discount to use. Fear of missing out on a discount reward can help to reduce churn and increase retention.
- Reducing price sensitivity – For cost-conscious subscribers, discounts make your product more affordable and reduce the likelihood of them cancelling due to budget concerns.
A/B testing rewards
Do credits, free gifts or discounts resonate most with your customers? Rewards can be A/B tested within Recharge to see which ones produce the greatest lift in retention.
By taking a data-backed approach like this to your rewards strategy, you can create an optimised experience for subscribers whilst maximising commercial results.
Integrating rewards throughout the customer journey
The Recharge Rewards module empowers retailers to spotlight rewards at various touch points in the customer journey, keeping perks top-of-mind for subscribers:
- Customer portal – You can motivate loyalty with portal punch cards that display a customer’s progress as they work to reach different order milestones.
- Cancellation surveys – Highlight any unclaimed rewards that are about to be lost when asking customers why they want to cancel their subscription.
- Win back campaigns – Promote unused rewards to maximise the impact of your win back landing pages and emails. Ensure these rewards are personalised to the customer to be most effective.
- Failed payment recovery notifications – Encourage subscribers to update their payment details by featuring any unused and upcoming rewards in your messaging.
Using churn analysis to decide when to offer rewards
By strategically providing rewards at high-churn points of the subscription lifecycle, retailers can nurture subscribers past these points, keeping them engaged where they would typically churn. This will help to increase a subscriber’s lifetime value and ensure you’re making the most out of customer acquisition costs.
For example, after conducting churn analysis for a pet supplement subscription brand, our Growth Accelerator team identified significant churn after one month, but high retention after three months. We were able to use this data to inform the brand’s discounting strategy, recommending that discounts are provided for the first three months of the subscription cycle. This was successful in reducing churn and increasing subscriber loyalty.
When it comes to identifying high drop-off points, Recharge users can do this within the Rewards tab of the platform. Clicking into the Performance section will enable you to review customer retention by cohort to understand when customers typically cancel their subscriptions.
Work with a leading Recharge agency partner to increase subscriber loyalty
As the go-to ecommerce agency for DTC subscription brands on Shopify, and an official Recharge partner, Swanky has helped launch and scale best-in-class subscription experiences for a range of fast-growth retailers.
We helped meal subscription giant HelloFresh launch a proof of concept store in Japan, generated an eight-figure additional revenue opportunity for leading pet supplements subscription brand YuMOVE, and built an award-winning subscription store with bespoke functionality for daysoftⓇ.
To find out how we could help you leverage Recharge to increase subscriber loyalty and more, please reach out to our solutions team.
Ecommerce loyalty & retention: Useful reading
If you’re interested in the themes of ecommerce loyalty and retention, you may also find the following resources useful: