When somebody walks into the Spinnaker Chocolate retail store in Seattle, it’s easy to make a sale. Who can resist the sights, smells and tastes of chocolate?
But since opening our family-owned business last year, we’ve discovered the challenges of keeping customers engaged long term and driving repeat business. How do we get buyers of our chocolate coming back for more, especially in a world where people buy so much online?
To succeed, we realized we needed an easy way to motivate our customers to buy from us again and again that doesn’t require them to keep returning to our retail location or consuming the time and energy to keep coming back to our website. We developed a solution: subscriptions.
In late 2021, we introduced the Spinnaker Chocolate Membership Club. How it works: Each member receives four allotments of our chocolate each year, and we offer three tiers of membership—”Cadet,” “Chief Mate” and “Captain”—priced at $30, $50 and $100 per quarter, respectively.
Each tier includes free shipping or in-store pickup, exclusive access to limited-release flavors and one complimentary tour of our factory per month for up to five guests. What differs among the tiers is the number and range of products members receive each quarter and how much of a discount they receive on non-club orders. At some point, we plan to offer exclusive access to special events, like chocolate-making classes. We want to keep our member benefits fresh and exciting.
So far, the tiered approach has worked well as it can appeal to people with different price comfort levels. In our first two-and-a-half months, we enrolled 54 members overall—representing $10,000 in recurring annual revenue.
That’s not huge, of course. But we’ve done it with no paid advertising, introducing it instead on our Facebook and Instagram accounts and in our e-newsletter. Just recently, we printed inserts about the club to put into our packaging. Something is clearly working, because we’re adding new members every week. Ideally, I’d like to grow our club to more than 800 members, and I think we’ll get there over the next year or two.
Unwrapping a new model
Logistically, getting the subscription model started required some back-end development—such as getting the sign-up and recurring payment capabilities set up. Now it just runs itself.
Members join through a billing portal on our website operated through Stripe. We then use Zapier, a workflow automation app, to connect our applications and create a more seamless and consistent membership-onboarding process. For example, when someone signs up for the club through Stripe, they are automatically added to our customer relationship management platform, Notion. They also automatically receive a survey about their membership preferences through Typeform and have a tag applied to them in Shopify to give them automatic discounts on future purchases.
The time and effort we put into setting up our membership club was totally worth it. We now have a recurring income stream from a large and growing group of long-term, loyal customers.
Moreover—and arguably the most important benefit—we can now more precisely project our inventory needs in advance. Memberships are billed annually for products that are delivered quarterly. It’s a lot easier to plan for the future if you know you’re going to have to make X amount of product in three months than if you’re having to guess how much you’ll sell.
“We now have a recurring income stream from a large and growing group of long-term, loyal customers.”
Recipe for growth
Looking ahead, we see memberships as a critical ingredient to our future growth, and it’s a great way to keep our best and most loyal customers close to our business and engaged in what we’re doing.
Subscriptions are becoming a bigger trend among consumers, and all types of product and service providers are rolling them out these days. We’ve found it’s a great way for a retail business like ours—which traditionally has relied so much on in-store foot traffic—to build a loyal, repeat customer base in the modern world.Print this article