The Chewy Method #money

This company found a way to get their customers to never stop paying by exploiting them at their most emotionally vulnerable moment. So this is one of the most popular pet food companies known as Chewy. And almost all of their customers are on a recurring subscription where they get this food delivered to them every single month. Except there's one problem with this subscription model which is that people's pets die. But instead of this being the reason that Chewy's business model doesn't work, they turn it into the reason that their model works extra well. Because the second that the customer's pet dies, they're not thinking about their subscription. So sometime later that month, they receive the food in the mail and then realize they have to cancel it. But while they're feeling really bad because their pet just died and they paid for a month of food that they're never going to be able to use, they go to the website to cancel the subscription. This is devastating, but Chewy identified this as a recurring moment and had the perfect plan. They credit back that last bag of food. They can't take it back for health reasons, so they tell the person to just give it away and will give you your money back. Then within that week they ship out a custom drawn painting of the person's pet, along with flowers and a hand-written letter saying how sorry they are. They actually have 200 full-time portrait artists now just to make these paintings. Now this entire process might cost them around 25 bucks. But the second customer receives this, especially at one of their most emotionally vulnerable moments, they ever get a dog again, they're going to go to Chewy. And that's the business model because half of people get a new pet within six months of their previous pet dying. They know they can get so much lifetime value out of those customers, and by spending just $25 to show that they care, they can basically guarantee that they unlock all that extra lifetime value.