Subscription boxes typically arrive in a recurring fashion with niche products in them. The recurring delivery of the boxes is what makes the model stand out with its marketing strategy and unique method of product distribution. Subscription boxes fall under a separate category of subscription commerce (also referred to as subcom), that is sub-category of e-commerce. Subscription boxes have also been defined as the culmination of the products, the experience and unique value propositions that make subscription boxes distinct from other consumer goods.
One early subscription box available was called The Sampler, which first became available in 2004 and offered samples of products from independent web-based artists, crafters, zines and shops. Various subscription commerce companies are growing rapidly. Since launching in 2011, Quarterly.co has doubled in size every six months. NatureBox, which launched in 2012, grows by 50-100 percent every month and BarkBox’s subscribers grew from 1,500 to 55,000 between 2012 and 2013. According to Forbes, Birchbox, which is arguably the most recognizable service and valued at a reported $485 million in April, 2014, led the subscription box trend with its 2010 launch. Birchbox’s model of providing customers with samples of personal care products in order to upsell customers into buying the standard sizes of the sample products they enjoyed has proven to be a successful marketing tool. Birchbox has reached nearly 400,000 monthly subscribers and has inspired many other companies to start utilizing subscription boxes.
Subscription boxes are aimed at fulfilling the recurring needs of consumers without the hassle of going through the entire process of making a purchase every time. There are a variety of product lines in which subscription boxes have proven to be great hit with the consumers. The idea of their monthly needs being taken care of in one single transaction has made the lives of such consumers much easier and convenient.
The model of subscription boxes is still relatively new and hasn’t made its place in a number of countries. For instance, in India, the model is quite new and thus the awareness for the same is still extremely low. People have the hesitation to try something different, something unusual.
Features of a Subscription Box
- Surprise – This is the characteristic of many subscription boxes that inspire phrases like “Checking the mail is fun again!” or “It’s like my birthday every month!”. This type of anticipation and excitement customers feel towards their upcoming box is an invaluable behavior – it’s often responsible for the wealth of unboxing and ‘box reveal’ videos, photos and blog post.
- Curation – Many subscription boxes also feature curation in some shape or form. This value proposition is essentially the promise that the items in the box won’t be totally random! This is the strongest value proposition for artisans, makers, and niche CPG brands to use when adding a subscription box to their product lines.
- Savings – This is usually seen as an obnoxious value proposition to subscription box businesses, because even if they’ve totally nailed the other value propositions, the long-term retention of a consumer seems to always come down to whether they feel they’re getting a good deal on the products in their box. It has also become a common habit of subscription box consumers to research the products received in their box in order to tally up and confirm the total retail value. This is also standard practice for subscription box review blogs.
- Convenience – Crucially, the element of convenience comes down to how a subscription box service is pitched. Clearly, there is a difference between Amazon Subscribe & Save and Dollar Shave Club – one is simply a recurring delivery (Amazon) and the other is a subscription box (DSC). This boils down to their framing: Dollar Shave Club has other value propositions in this list: Savings, Discovery and Presentation. Instead of being a mass market consumer brand who enables deliveries of product, Dollar Shave Club has a branded, “shaving expert” persona built into it, making it similarly convenient but decisively unique to consumers.