Earlier this summer, Case Mason leadership and members of Case Mason’s dedicated subscription box team attended the 2017 Subscription Summit in Austin, Texas. According to its website, the Subscription Summit “connects today’s leaders, innovators and partners that are driving the rapid evolution of how customers discover, buy and experience new products.” As the strategic third party logistics (3PL) partner for an international beauty and cosmetic company’s monthly subscription box, Case Mason attended the Subscription Summit to gain more in-depth knowledge of the SubBox industry and how 3PL companies, like Case Mason, factor into a subscription box company’s overall success. Over the course of the two day conference, we were able to learn an enormous amount from and network with the many industry experts who were in attendance, speaking and/or sponsoring the event. Our subscription box team walked away with seven key takeaways from their time at the Subscription Summit.
- Know your audience.
- Personalization is a key.
- Utilize social media to grow brand awareness and allow your subscribers to spread your message.
- Align with social media influencers.
- Continuously feature new products; but make sure to offer replenishment sales and “fan favorites”.
- Mobile is the present and the future.
- Include shipping cost in final price.
Each of these key takeaways is part of the foundation on which successful subscription box businesses are built. The first step to becoming a SubBox industry leader is identifying a niche market and getting to know that market’s audience. It is important to focus on a particular niche because the subscription box industry has exploded in recent years and an oversaturated marketplace is on the horizon. Knowing your target audience and catering to its specific needs are the most important aspects of developing a successful subscription box business. While it is necessary to target a specific audience, it is important to be wary of limiting the appeal of your box to only one small group of people. Never box yourself in too much.
Once you have selected your target audience and feel like you have a firm grasp of their interests and purchasing habits, ask subscribers for their input on what should be included in each box. Subscribers are willing to share more personal information nowadays in order to receive a more customized box. Some subscription boxes present their subscribers with the option to choose one item of their personal liking to include in the upcoming month’s box. By asking the consumer for his or her input, subscription box companies are able to better predict what products will be well-received by subscribers in the future and make their subscribers feel valued. The willingness of subscribers to share more personal information allows the subscription box companies to deliver a more curated experience.
Social media is one of the most important tools in terms of growing a SubBox business. Spreading the word about your subscription box across all social media platforms can seem like a daunting task, but it is a crucial component to achieving success in a crowded marketplace. Distributing content on a consistent basis increases visibility and allows consumers to spread the word about your subscription box with their online friends and followers. Shares, comments and discussions on social media act as a form of free advertising. Whether that advertising is positive or negative depends on the quality and condition of the products inside the box, the condition and visual appeal of the box itself, a timely delivery of the box and the customer experience while subscribing or dealing with a product quality issue.
Coupled with the sharing of social media content, a positive review or endorsement from a so-called “social influencer” can result in a sizeable subscriber increase. Social influencers have the ability to reach millions of people due to their large following on social media. Many subscription box companies align with and send their boxes to various social influencers each month so that the social influencers can post videos of themselves opening the box and revealing the contents of that month’s box. The upside of these social influencer video reveals can be tremendous, but there is also a risk factor involved if the social influencer is not officially aligned with and/or being paid by the subscription box company. If the box that the social influencer receives happens to include a damaged item or is missing an item altogether, there is no second chance to impress that particular social influencer. The social influencer has a responsibility to his or her audience to present an unbiased review of the subscription box. If his or her experience with a subscription box is unsatisfactory, that opinion will be distributed to all of their online friends and followers. For the most part though, social influencers are being compensated by subscription box companies to post reviews of their products. In those cases, the social influencer must inform the audience that they are being paid to promote the subscription box by including #Ad or “This post was sponsored by” in their post.
Once a consistent subscriber base has been established, it should be your goal to retain all of those existing subscribers, as well as continue to grow your number of subscribers. The keys to retaining current subscribers are continuously featuring new products; yet also offering replenishment sales and “fan favorites”. By offering new products each month, a sense of anticipation is created within each subscriber waiting to receive the box and find out what is inside. This keeps subscribers from growing tired of any products and allows them to sample many different products in search of the few that will become habitual purchases. By offering occasional replenishment sales and “fan favorites” alongside new products, you show subscribers that their input valued. When the subscriber consistently receives quality products and feels that his or her input is valued, brand loyalty is established.
As social media has become one of the most used tools to spread the word about subscription boxes and the popularity of e-Commerce has skyrocketed in recent years, mobile revenue streams are the future of the subscription box industry. Mobile revenues have been on a consistent upward trend and will surpass traditional e-Commerce sales at a considerable number of subscription box companies in the near future. Mobile is both the present and the future of the subscription box industry, so it should be at the forefront of all subscription box companies’ plans to create and perfect Omni-channel marketing and purchasing.
The seventh and final key takeaway from the 2017 Subscription Summit is the inclusion of shipping costs in the total price of your subscription box. Research shows that conversions drop 30% if shipping costs are not included in the price and are tacked on later in the purchasing process. The consumer may feel duped or confused as to why a subscription box advertised at $10 actually costs $12.95 with shipping and handling. It can seem like a minute detail to some, but advertising one price and then adding in hidden shipping costs can give off the wrong impression and deter a potential subscriber from purchasing your subscription box.
Whether you are in the planning stages of starting a subscription box company, want to grow you current subscriber base or are a giant in the SubBox industry, it is important to remember the seven key takeaways mentioned in this post. Based on our experience as the exclusive 3PL partner to an international beauty and cosmetics company’s subscription box and from listening to industry experts speak at the 2017 Subscription Summit, these approaches can be applied to any size operation in order to achieve success in the subscription box industry.