Coffee brand illy has launched a new subscription program offering customers an 18-month coffee supply and a discounted or even free espresso machine at sign up.
The subscription program leverages artificial intelligence by using algorithms to analyze billions of product and data points from millions of consumers, through its use of a system from OrderGroove. Rather than checking out just the machine, customers are prompted to sign up for the “illy a casa” program.
illy is the first to offer this type of subscription program. Since it started working with OrderGroove in June 2017, the brand has seen 44% increase in illy customers added in the U.S. who selected the “illy a casa” machine program during this period.
This is the newest subscription program and its distinguishing feature is that it reduces the barrier to entry for subscribers by offering an espresso machine for free with the subscription, versus a standalone coffee subscription.
illy saw an 88% increase in customer spending compared to one-time purchases of the illy coffee machine without the “illy a casa” program. It also saw a 10% increase in its overall net promoter score (NPS) on the illy.com website.
“By offering the ‘illy a casa’ program at the optimal moment, we are making it easy and convenient to enjoy illy coffee through a premium subscription program,” said Andrea Vitale, Senior Director of Ecommerce for illy Caffe, North America. “In return we are experiencing increased customer satisfaction and lifetime value. It’s a win-win across the brand.”
Vitale said while the brand worked with OrderGroove for the subscription piece of the business, it also revamped its ecommerce website to make it easier for customers to enroll in and manage their subscriptions.
“Upon enrollment, customers choose their favorite coffees and customize their deliveries according to their preferences, including how often they would like the coffees delivered,” said Vitale. “Then through the self-management feature on the website they can easily make changes to the deliveries so they never run out of coffee.”
Vitale said illy sought to improve the subscription experience from the very beginning and take out any frustrations or friction for customers.
“The iperEspresso incentive and perfectly-timed delivery frequency were critical,” said Vitale. “OrderGroove’s technology and consumer insights helped us optimize the conversion of what could have been a one-off machine purchase into a recurring consumer relationship with our coffee subscriptions.”
Vitale said illy leverages data and analytics from OrderGroove to power its subscription service, including optimizing frequency of orders.
“Since we revamped our website we have greater visibility into what’s happening with our customers,” said Vitale. “We’re able to see what’s working and what’s not with our subscriptions so we can clarify what on the site, add benefits for the subscription audience and make the overall experience better.”
Vitale said illy is exploring predictive reordering which will prompt customers on their next coffee replenishment.
“Customers wouldn’t need to commit to a subscription yet would still have an easy way to replenish on a recurring basis,” she said. “They can opt in to receive a text message when they’re about to run out of coffee, and all they have to do is say ‘yes’ for the order to go through.”