Episode 21: Customer-Focused Innovation for Long-Term, Happy Subscribers with Gertrude Allen, CEO of PetPlate

In this episode of the Subscriptions: Scaled podcast, Nick Fredrick, President of Rebar Technology Solutions, is joined by Gertrude Allen, CEO of PetPlate.

What is PetPlate?

PetPlate delivers freshly cooked food for dogs nationwide. All meals are made in a USDA kitchen with wholesome ingredients and then flash-frozen to lock in the nutrients. Then they ship the food to pet parents within a day or two. 

All meals are pre-portioned for the specific dog's profile and nutritional needs, and served in microwaveable, resealable, recyclable containers that make it easier for the pet parent to use. 

Right now, they serve four main meals and are launching two more meals and treats in 2021.

From Venture Capital to Pet Food Subscription

Gertrude worked at the venture capital firm, BrandProject, before joining PetPlate as CEO. BrandProject was very active in the direct-to-consumer subscription space. Gertrude was involved in the decision to invest in PetPlate.

Within six months of being an investor in PetPlate and working closely with the founder, Gertrude was asked to join the company as the CEO. 

The founder of PetPlate, Renaldo, had great insight into how to serve healthy food to pets. He created PetPlate after seeing what was going into mass-produced pet food and not wanting to feed it to his dog. His insight and passion helped make his business investable. 

The other factor BrandProject and Gertrude saw was that dog food was a "sticky" consumable product that made for excellent subscription retention. High retention leads to predictable revenue that allows PetPlate to plan for product launches and test new growth ideas with the security of recurring income. 

From Subscription-Based to One-Time Offers

After four years of having subscription-only offers, PetPlate is moving into adding one-time offers. They will sell on their own site, other online channels, and even retail. 

This move is an attempt to reach consumers who want to try products before they subscribe. In addition, more consumers know about the option of freshly cooked dog food. One-time offers are one way PetPlate is trying to get in front of those new consumers. 

They will offer treats as one-time purchases along with a sampler box of their meals. In addition, one-time buyers will have the option to add subscriptions after trying products through the one-time offers. 

Converting One-Time Buyers to Subscription Customers

Because PetPlate customizes its subscriptions to each dog, subscribers have to go through their intake flow and answer questions about their dogs. 

To offer one-time buyers the subscription service, Gertrude says they'll use an email campaign to explain other options that would round out their experience. 

Every customer has an account page or customer portal to control their meal plan frequency, amounts, flavors, and more. They'll encourage one-time buyers to create accounts to customize the options for their dogs as well. Once inside the portal, they'll see the options for subscription service, along with the email campaign they'll receive. 

Subscriber Acquisition Strategy

Right now, PetPlate discounts the first box to attract new subscribers. They offer a generous 40% to 60% discount plus free shipping on the first box, and smaller offers on the subsequent purchases to keep new subscribers interested. It's worked well in retaining customers.

The other strategy they use is a multi-box discount spread out over a few months, for example, $100 off spread out as $25 off for four months. Once a subscriber sticks around for a few months, PetPlate knows there's a good chance they'll stick around for years. In addition, the multi-box discount attracts a less price-sensitive customer since the first discount is not as big as the other strategy. 

Onboarding Subscribers For a Better Experience

In the beginning, PetPlate onboarded subscribers in a less customizable way. They allowed customers to choose ranges and gave them a lot of information and menu options. 

They quickly learned the pitfalls of that. They weren't giving consumers the chance to learn how a fresh food diet works for their dog. 

PetPlate bases subscriptions on multiple factors they needed to collect through a process. They needed to allow customers to build a subscription-based on the information they shared. 

Each subscription is different. One subscriber with a small dog may get one box per month. Another subscriber with a large dog may get a box every week. Because the food is fresh and needs to be stored in a freezer, they have to consider how much food a subscriber can handle at once.  

Innovation to Minimize Churn and Keep Subscribers Longer

Gertrude talks about several different reasons subscribers churn. For PetPlate, it usually comes down to a lifestyle change. They may have a tighter budget because of loss of income or more expenses. Their dog may develop intolerances to certain foods. They may move and have a challenging time storing fresh food. 

PetPlate meets the challenges by continuously trying to innovate with products that accommodate different preferences and lifestyles. For example, they're launching new meals that have therapeutic benefits for dogs with illnesses. They're also launching a new product that won't rely on freezer storage and have a lower price point.

The goal is to have solutions that subscribers can grow into versus allowing them to grow out of what PetPlate provides. They want to stay one step ahead to enable subscribers to remain subscribed longer. 

For your own business, it'd be beneficial to think about the changes your subscribers may go through. What are lifestyle changes that can affect how they interact with your company?

Is there anything you can offer that will help them handle those new changes?

Growing Quickly and Responsibly

Everyone wants to innovate and iterate quickly. But how do you balance rapid growth across technology, people, and processes? How do you ensure the decisions you're making now are good for your future as well?

Gertrude says one important factor is communication. 

PetPlate has cross-functional meetings at least three times per week. As a result, they constantly exchange information to make sure one department isn't racing too far ahead of everyone else. 

The goal is coordinating and synchronizing progress, so they move forward together. The product team can't be so far ahead of the technology team that a new product is created and can't launch on the website on time. The technology team can't be so far ahead of the marketing team that a new product launches, and there's no marketing available for it. 

It all starts with the leadership at the top to ensure their teams are involved in those conversations.

To hear more from Gertrude, tune into this episode of the Subscriptions: Scaled podcast.

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