What is a subscription box?
The subscription box is that a seller lets customers to subscribe to their products and then automatically sends them products every month.The surprise box is a type of subscription box, which the customer doesn’t know what products will be in the box until he or she opens it.
While most consumers choose to shop online for the convenience and efficiency of online shopping, those who subscribe to a subscription box are more interested in the anticipation of it. They enjoy the process of opening the box and want to try something different.
A very small number of consumers subscribe to subscription boxes because they want to make a difference in their lives and treat themselves (or their families) better. Subscription boxes add a sense of anticipation and adventure to their lives, allowing them to constantly explore new products and things.
The content in a subscription box has endless possibilities – it can be a surprise, a new product to try, a new product that the customer is already used to, etc. There are almost no one-time purchasers in the subscription box business. After a customer signs up, they almost always subscribe to overall products.
What does a successful subscription box look like?
Anything can be consumed, such as food, beauty products,etc. Daily household items can be used to create a subscription box.
A very typical success story is Dollar Shave Club (founded in 2011), which has been so successful selling premium razors to American consumers in subscription boxes that in 2016. Unilever acquired Dollar Shave Club for $1 billion.Nowadays, the business model has spread in the razor industry.
Notably, companies that launch surprise subscription box businesses seem to be more successful than regular subscription box companies. This is because companies can get some products with brands for free and put them in a surprise box. Some brands company will even pay subscription box companies to put their products in the boxes. There is nothing better for a business to get free products and financial input from a customer or supplier. Birchbox, an e-commerce subscription service for beauty products, and BarkBox, an e-commerce subscription company for pet supplies, have had good success in this area.
What makes the subscription box attractive?
There is a saying in the market that “subscription subscribers are more valuable than regular customers”. This is because the subscriber allows the seller to automatically debit their card on a regular monthly basis after they subscribe, that is, seller can get a monthly sale and revenue for the seller without any effort.
The subscription box business gives sellers a steady cash flow and a higher income. While traditional e-commerce businesses may make 3 times the annual profit of their costs, subscription businesses may make 10 to 12 times the annual profit of their costs. Subscription businesses are far more profitable than traditional e-commerce businesses, and future revenues are more secure.
Of course, you can’t keep all your subscribers forever. But, regardless, it’s already a win for anyone on the starting line. Whatever, seller owns more stable customers and cash flow.
