Last week Birchbox announced big changes to its point program which rewards subscribers for posting product reviews. Subscribers, who were notified of the pending change via email, are upset about the devaluation of the current point system, reports Consumerist.

The biggest change is that subscribers will now only receive rewards points for their first five product reviews, beginning July 11. Previously, they received 10 points for each review. When a subscriber had accumulated 100 points, they received a $10 discount on full-sized versions of beauty products for sale on the Birchbox site. With five to six product samples in each monthly box, the points were fairly easy to accumulate.

Until now, subscribers had to have at least 100 points before they received the discount, and they expired after a year. Now those points expire within six months, but subscribers don’t have to accumulate 100 points first. Now that subscribers are limited to five reviews, they can only earn 50 points for a total discount of $5.

So why the switch? In statement by Birchbox to Consumerist, the problem was the quality of the reviews. People would leave reviews without having sampled the products first, so Birchbox is reducing the incentive to encourage more genuine reviews. Here’s how some subscribers reacted on Twitter:

Digiday calls the change “business suicide.” Here’s what Birchbox told Digiday.

In other words, in addition to ensuring the quality of customer reviews, the company is also looking ways to cut costs. This isn’t the only bad news plaguing the company. In January, Birchbox announced it was laying off 15 percent of its staff and suspending operations in Canada, and last week the Wall Street Journal reported that the company is scaling back its plans for growth. According to the Journal, Birchbox has not received any new funding in two years, and the beauty-in-a-box marketplace continues to add new players.

Insider Take:

We are not subscribers, but we have friends who are and, like those who’ve been vocal on social media, they aren’t happy and plan to cancel their Birchbox subscriptions. They viewed the reward points as a huge incentive to write reviews and earn discounts on products they loved. By dramatically devaluing those incentives, Birchbox has lost a bit of its competitive edge. With other beauty box subscriptions like Sephora’s Play, Ipsy and Beauty Box Five available, subscribers have a lot of other choices.

From a company perspective, it looks like Birchbox needs to cut costs, but upsetting subscribers without a clear explanation for the reason for the changes is not likely to help, particularly if their retention rates tank. Financially, this may have been a partial solution to a cash flow problem, but from a customer service perspective, this could cost Birchbox in the long run.

Another issue we see is lack of transparency. Yes, Birchbox emailed its subscribers about the changes, but the email wasn’t personalized (which is very easy to do!) and it didn’t explain why the changes were necessary. The company’s Birchbox Points page online only includes some of the changes, but again, without an explanation. The company’s blog and Twitter accounts don’t mention the change either.

Also, a review of Birchbox press releases shows that Birchbox has only posted positive news, but not news of this change, its layoffs or other cost cutting measures. We can appreciate the desire to present themselves in the most positive light, but not being open with their subscribers could backfire.

While this change may have been necessary for Birchbox, if the company had handled it more openly and diplomatically, perhaps it wouldn’t have generated such a negative reaction. This example, however, can serve as a lesson to other subscription companies of how not to handle a potentially disastrous change.