Boxed Brilliance: An Overview of Subscription Box Ecommerce

How do you feel about going to your mailbox?

If you’re like most Americans, the answer is probably a little ambivalent.

And this makes perfect sense, considering that most of what we get in our mailboxes is junk that often includes promotional flyers, credit card offers, magazine subscription pleas and the like.

What if you could pay a low monthly rate for something that would make picking up the mail a lot more fun?

That’s what roughly 21.4 million customers have done, in the form of subscription box services.

A unique way to discover new products, access personalized goods and give yourself something exciting to open in the mail every now and again, subscription box services have exploded in recent years.

Here’s what you need to know:

What is a Subscription Box?

A subscription box is a curated box of goods that ships right to your door on a set schedule.

Payment for these boxes is automatic (the services typically link right to your credit card or bank account, and withdraw funds on a set schedule) and they come in a wide assortment of varieties.

Today, there are subscription boxes for food, clothing, health and beauty products, pet products and even baby goods. There’s also a murder mystery in a box subscription service, a subscription box made for knitters, and one called the Hygge Box, which includes candles, teas, hand creams, and everything else you need to make your home a cozy place.

These are but a few of the more than 2,000 subscription box ecommerce services you can consider using today for a nominal monthly fee.

How Popular are Subscription Boxes?

The idea behind subscription boxes is simple: pay a monthly fee, and we’ll ship you something fun in the mail.

That’s precisely why they’ve taken off like they have, though.

Receiving a package in the mail is a fun experience. It feels a bit like Christmas. And it’s extra exciting when you’re receiving a package of curated goods you look forward to using.

The evolution of the subscription box started, arguably, with a company called Dollar Shave Club.

A men’s razor subscription service that ships razors and accessories (razor handles, shave creams, and other self-care items targeted mainly toward men) to consumers’ doors on a monthly basis, Dollar Shave Club was one of the first companies to truly set the standard for what a subscription box could be.

The company launched in 2012 and was competing with major names like Gillette, which dominated a whopping 72% of the U.S. razor market. Within four years, the company had grown to a valuation of $236 million, effectively capturing 51% of the market. In 2016, Unilever purchased Dollar Shave Club for $1 billion.

With that example in mind, here are a few of the primary reasons people love subscription boxes so much

• They Make Shopping Easy. If you’re one of the many busy people in the world who finds the task of shopping difficult and time-consuming, subscription boxes could be for you. Services like Stitch Fix and Trunk Club take advantage of this by offering monthly boxes of curated, no-obligation clothing selected by personal stylists, based on your specifications and measurements. If you don’t like it, you send it back at no cost to you. If you do like it, you have a whole new wardrobe, delivered right to your door.
• They Introduce New Products. Birchbox is one of the most popular subscription box services out there. A monthly box of personalized makeup, Birchbox specializes in sample-size makeup, haircare and skincare products. If you like the product, you can navigate to the company’s ecommerce store to purchase a full-size version. It’s a straightforward way to discover new brands, without spending hours researching them yourself.
• They’re Profitable for Brands. Subscription boxes have all sorts of benefits for consumers and While traditional customer acquisition approaches like discount points and cross-channel selling are more familiar than subscription boxes, they can cut into profit margins and result in a retailer losing money on their sales. Subscription boxes, on the other hand, offer more predictable inventory and higher profit margins. Naturally, they’re a major hit among companies.
• They’re Easy to Setup. In 2013, subscription box sites averaged 722,000 visits. By 2016, that had grown to 21.4 million. Today, there are more than 2,000 subscription box services throughout the U.S. This massive growth owes to the fact that subscription box services are fun, exciting and, yes, easy to setup. Once a consumer inputs their preferences, subscription boxes are a “Set it and forget it” offering, which is ideal for both companies and their customers.

3 Essential Subscription Box Considerations

If you’re interested in getting into subscription commerce services, you may be onto something great. Not so fast, though. There are a few things to consider before you take the plunge:

1. Keep Choices Limited

Subscription boxes are supposed to offer variety, but not too much variety. Instead of making everything you carry available for subscription boxes, keep the choices limited. This prevents logistics nightmares and makes it easier for your company to maintain stock during fulfillment.

2. Simplify Shipping

Shipping should be simple, as well. For best results, lay out your shipping plans, so they’re straightforward and easy to understand. If you can keep your boxes in a weight range that qualifies for expedited USPS Priority Mail Shipping, you’ll save both you and your subscribers a great deal of money.

3. Make it Convenient

The more you research and curate your products, the more willing your customer will be to step right into your subscription box, trusting that they’ll like what they find. Don’t forget to publish a few blog posts outlining your process, and to create a dynamic where the customer understands how and why you select the products you do.

Subscription Boxes: The Way of the Future

Convenient, exciting, and unique, subscription boxes are a great way to drive stronger relationships with your ecommerce customers.

If you’re interested in stepping into them for your brand, the move could be a great one. As long as you focus on simplicity, limited choices and convenient options and partner with a good CRM for your ecommerce store, subscription boxes could be a great way to drive growth and promote engagement from customers.