The first thing is obviously you have to have a good model and purpose and it doesn’t need to be something that hasn’t been done before. We see examples like our very first SubSummit of someone in the room and he was just getting started. He was nipping at the heels of Ipsy. Fast forward to our SubSummit in 2021 and he was on stage because he had just been acquired by Ipsy, in a good way. You know, they saw him as a big competitor and saw him as a great way to merge up another business and from there they became one unit. So just because Ipsy was the 800 pound gorilla doesn’t mean that you can’t take a good chunk of their market share. So build a good model and business.
As part of our series about ‘5 Things You Need To Know To Create a Profitable Subscription Business’ I had the pleasure to interview Paul Chambers at the 2022 SubSummit hosted by SUBTA. SubSummit connects industry leaders, innovators, and partners who are driving the rapid evolution of how consumers discover, buy, and experience new products.
An entrepreneur since fifth grade, Paul Chambers is the Co-Founder and CEO of the Subscription Trade Association (SUBTA) and its industry-leading event, SubSummit. Paul has extensive expertise in the subscription commerce economy, dating back more than two decades, and has been recognized by national and international publications and media outlets.
In his spare time, Paul is a firefighter in the City of Troy and loves to spend time with the world’s most amazing wife, twin daughters, two son’s, and their dog, Piper.
Our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started?
I’ve actually been in business for 25 years now, and long story short, 25 years ago I tried to start an internet service provider and I failed miserably at it, but here I am today. I took that original idea and morphed it into what eventually in some weird way became SUBTA. I have a digital marketing background and still have a digital agency today that helps me build and grow. We started Gentleman’s Box in 2014 and we decided we needed to find an event where we could meet other like-minded subscription box owners which didn’t exist. We’re like, let’s create that. That sounds easy and fun. It was not easy and fun by any means, but actually incredibly difficult. But we were able to host our first event in Detroit in 2016 and here we are today with almost 1,300 attendees total at this event, a little slow due to the pandemic, but we’re in good shape.
What was the “Aha Moment” that led you to think of the idea for your current company? Can you share that story with us?
The aha moment was realizing that nobody was out there properly representing and bringing together these DTC subscription brands and when we got started a lot of people thought of it as, you know, subscription box or Dollar Shave Club and things like that, and really it’s so much more. We subscribe to so many things and newspapers have been in our lives for centuries, and so realizing that there was an opportunity to help mold and shape that and lead that industry, that was our aha moment and bring amazing people together too.
Can you tell us a story about the hard times that you faced when you first started your journey? Where did you get the drive to continue even though things were so hard?
I don’t know which story to share with you because there’s always those moments, right? The very first business I had, I failed miserably at it. I thought I knew what I was doing. I bought $10,000 worth of equipment, money borrowed from my grandfather and lost all that money and spent it all. So I had to figure out a way and I pivoted and started building websites and was successful from there. Later on in life, I started another business and just didn’t quite go as planned and so to me, the lesson in all of this is not giving up, pushing through and persevering and eventually those pivots and those changes can help you get there.
How did your grit and resilience lead to your eventual success?
A big thing is not living life with regrets. I actually did a podcast on this stage yesterday with Patrick Campbell and we talked about this and the struggles you have and the mistakes you make and the challenges. It’s about learning those lessons and moving on because there’s nothing you can do about it. So to sit there and dwell on it…what’s the point? So living life without regrets, but learning your lessons and moving forward.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lessons or ‘take aways’ you learned from that?
I think of funny moments and funny things happening. You know, a lot of it has to do with going on live TV and people will ask you questions that you’re not quite prepared for. I was on Cheddar TV and they’re like, tell us about some really weird subscriptions. I’m like, I don’t know any weird subscriptions. I mean, there’s some out there for sure. I think there’s just times where you do things and you’ve got to just laugh it off and not dwell on it. I did a live TV interview with Metro Detroit one time and answered some questions and at the end the reporter goes, all right, Paul, go on with your bad self. I was like, what do you say to that? You know, it’s those kinds of times.
What do you think makes your company stand out? Can you share a story?
I think what makes us stand out is we do this with the truest intentions. We started it a little bit selfishly at first…we wanted to meet other subscription box owners. So we said, let’s create an event where we can meet them and from that very first event we learned something that changed our business financially significantly. I think that’s what really makes us stand out is that we’re not here just to run an event and produce a profit. We’re here to bring people together. Our Cube Awards ceremony that we put on last night, a massive event, it’s an absolute loss leader for us. We spend more on the food because we care so much for the community. If we can help a company improve their customer service, we can impact thousands, if not hundreds of thousands of lives. If they can improve their customer service, then their end users will be happier. We truly want to have an impact and make a difference.
Which tips would you recommend to your colleagues in the subscription commerce economy to help them to thrive and not “burn out”?
It’s a common saying it’s a marathon not a sprint. There will be pivots and that’s the theme of our event this year, to shift and discover because when you make those small shifts or big shifts, those are your chances to discover what’s possible. What’s next? Subscription is in this interesting place right now where we subscribe to so many things in life and they eventually become an upper limit of what we want to subscribe to. That bar will probably rise over time as more and more things become subscription, but what our goal is to help the community embrace the fact that subscription isn’t something that you need to be worried about. It should be something you could come and go as you please. If you want to pause Netflix for a minute, that’s okay because you’re using Apple TV more and Netflix shouldn’t be mad about that. It should be about making an amazing experience.
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are?
I’m absolutely grateful for one of the biggest mentors in my life, Ben Jones. He is the reason this event exists. He’s been an inspiration and all the little things that we do to make those touch points so impactful. I kind of studied under him at an event that he ran and learned the way he did things and applied all those principles here.
Ok thank you for all that. Now let’s shift to the main focus of this interview. Approximately how many users or subscribers does your company currently have? Can you share with our readers three of the main steps you’ve taken to build such a large community?
We have 2,500 members in our community. We have different levels in actually reshaping the way we look at our model right now. We have our free basic membership where people can log in, connect with others in the community and learn and grow. We have a premium membership where not only do you get that community, but also lecture series, access to eBooks, the ability to watch all of our subsequent content on demand and then we have our premium plus where we get people in peer groups and they really learn networking and grow together. Each of those membership levels also gets access to our data dashboard. One of the most common conversations that I have with subscription companies ranging from the biggest industry publications like New York Times, Washington Post, Netflix, iRobot to those just getting started is, how am I doing?
Churn is a metric that we talk about a lot in our industry as is customer acquisition costs. People want to know, how’s my business doing compared to my peers? There really is no place out there that is giving people that overview. You can get it from Recurly, we can get it from Recharge, but you’re in those cohorts within their ecosystem and so we’ve built a data dashboard where when subscription companies log in, answer a few basic questions and the data is anonymized as it comes in from them. So then I can say to whether it be a large publication, like New York Times, hey, other companies like yours with your subscriber account, your revenue, maybe your industry have a churn of this, and now they know where their goal posts are and how they’re doing and that’s something we’re building out and over time that data gets more and more powerful for those users because they can see in real time how they’re doing compared to their peers and if they need to be doing better or if they’re above average.. So there’s some amazing tools and that’s what’s really helped us build our community by listening to what they need and want and building those tools for them.
What is your monetization model? How do you monetize your community of users?
Our monetization is through our premium plus membership which is $500 annually. Premium plus starts at $1,500 annually. Our basic membership is free. There’s other monetization that comes within that but we also run our event, which is a large revenue driver for us as well through sponsorships and ticket sales at the event. We also do other small events throughout the year.
Based on your experience and success, what are the five most important things one should know in order to create a very successful subscription business?
The first thing is obviously you have to have a good model and purpose and it doesn’t need to be something that hasn’t been done before. We see examples like our very first SubSummit of someone in the room and he was just getting started. He was nipping at the heels of Ipsy. Fast forward to our SubSummit in 2021 and he was on stage because he had just been acquired by Ipsy, in a good way. You know, they saw him as a big competitor and saw him as a great way to merge up another business and from there they became one unit. So just because Ipsy was the 800 pound gorilla doesn’t mean that you can’t take a good chunk of their market share. So build a good model and business.
Number two, make sure you have a good team and if you’re a solo entrepreneur just starting off, that’s okay. You can find those advisors and mentors. When we first launched SubSummit, it was three of us, myself and my two partners. I had my mentor that was part of it. I leaned on my marketing team and those around us to help us build it.
Three, you want to find a good, solid way to acquire customers. Just running Facebook ads is not going to be the answer, it’s too late for that. Jane Myers from Bold Commerce here gave a talk about that the other day. The way to get through what’s called the “subscription death curve” is to build a really good referral system. So build that acquisition model.
Number four is retention. Focus on retention and focus on how you can retain customers and not in a way of making them call to cancel and a way of giving them opportunities and options. So if somebody goes to cancel, understand why and then see if there are alternatives you could offer them. So look at those data points and make decisions from there.
The last would be just keep a keen focus on your financials and know your operations behind it. Knowing your numbers, and knowing your business will make you successful.
How can our readers follow your company online?
You can find us at Subta.com. You can learn more about our events at SubSummit.com
This was very inspiring, Paul. Thank you.