‘Cookie Club’ Sees Strong Subscriber Retention Amid Inflation — but Not Acquisition

As direct-to-consumer (D2C) businesses look to woo budget-conscious shoppers with subscription deals, Taylor Chip Cookies’ “Cookie Club” is seeing loyalty remain strong, but reaching new customers is proving to be a challenge.

In an interview with PYMNTS, Doug Taylor, co-founder of the cookie brand, which operates a D2C business, a third-party aggregator presence and a handful of brick-and-mortar stores, shared that subscriber retention has remained strong, even as sweet treat brands across the industry struggle to bring new consumers into the fold.

“Acquisition is harder for sure,” he said. “… I’ve talked with a lot of people in the industry, including some really, really big businesses and founders, and everyone says they’re feeling a little bit of a pullback. People are being very cautious with what extra they spend.”

PYMNTS research confirmed that consumers are being more conservative with their food and beverage purchasing. Data from the study “Consumer Inflation Sentiment Report: Consumers Cut Back by Trading Down” revealed that 57% have cut down on nonessential grocery spending.

Plus, findings from PYMNTS’ study “Decision Guide – How Retail Subscription Merchants Can Win and Retain High LTV Customers,” created in collaboration with sticky.io, found that subscription programs’ most loyal customers account for the majority of their revenues. Specifically, these so-called loyalists, who represent 30% of all subscription customers, account for 79% of merchant revenue.

To that end, Taylor said prioritizing these existing, loyal customers is key, and businesses that get distracted just trying to go after new subscribers are setting themselves up for failure.

“Trying to focus all your time on acquiring new customers and forgetting about the ones that you’ve already had … would be probably the biggest misstep anyone could make in this type of economic climate,” Taylor said.

Even subscriptions’ most loyal customers have high standards, and maintaining their positive sentiment requires ongoing effort, striking a balance between encouraging their engagement and having a light touch. The Decision Guide study found that 28% of loyalists would cancel their subscriptions after having a bad experience with customer service, and a similar share said they would do the same if they received excessive promotional materials.

Looking ahead, Taylor said he is excited about the possibilities of social media, and PYMNTS research revealed that many consumers discover and engage with their favorite eateries via these channels. The study “Connected Dining: Word of Mouth in the Digital Age,” found that 37% of diners search for restaurant information by accessing content from a restaurant’s social media page. That share jumps up to 42% for Generation Z and 46% for millennials.

“I’m excited about probably where social is going to go — organic reach on social media, and especially Facebook,” Taylor said. “I think that allows for greater and greater storytelling. … People now really love storytelling, so that, to me, is the biggest opportunity.”