More and more consumers are developing the habit of subscription boxes. Retailers should too.

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August 12, 2022

Sales of subscription box services have soared since the start of the pandemic, driven by consumers’ desire for convenience, value and variety.

eMarketer.com estimates the subscription box segment grew 41% between 2019 and 2020, followed by a 19% gain in 2021. Sales are expected to rise 18% this year to $32.65 billion before surging an additional 17% to reach $38.2 billion in 2023.

Subscription box services seem here to stay. Here are some ways brands and retailers can keep customers coming back again and again.

Product

Consumers want unique and quality products. Selecting and curating merchandise that appeals to targeted consumers and supports brand position is critical for retention. Provide relevant recommendations, options, choices, ready-to-use new items or mystery giveaways (with a QR code to give feedback). Leverage technology to understand product performance, issues, and opportunities to upgrade assortment or offer new adjacent lines.

The best box providers offer:

  • Relevant and exciting merchandise;
  • The right number of options – neither too few nor too many;
  • Flexibility to browse, choose, swap and ignore;
  • Comments from other people, such as “Hall of Fame” and “Most Popular” posts;
  • A selection of limited time offers, seasonal promotions and partnerships.

Service

Efficiently complete the actual sales transaction. Relentlessly focus on pre- and post-purchase engagement to differentiate service, increase loyalty, retention and referrals. Identify key touchpoints and send an optimal number of releases at different times during the subscription period. Use advanced data and analytics to understand consumer sentiment and opinions to predict preferences. Manage the number and tone of reminders. Ensure communications are on-brand, informative and useful. Provide plenty of opportunities to participate, rate, and provide feedback through surveys, quizzes, and QR codes at every step of the process.

While the pandemic has boosted subscriber numbers, 34% of Millennials say they are likely to continue buying subscriptions. Subscribers (including me, a seasoned foodie and new HelloFresh Meal Kit subscriber) feel more connected to direct subscription services than one-time e-commerce purchases. Boxes are here to stay and brands need to reflect that.

DISCUSSION QUESTIONS: What do you think are the keys to the success of a subscription box service? Do subscription box services provide an additional sales and loyalty opportunity for retailers?

Braintrust

“If the subscription is done well and consumers like what they’re getting and feel like the value is there from a price and assortment perspective, they’re going to stick with it.”

“It’s not an easy job, but it’s worth it if done right in terms of customer retention and sales growth. »

“…it’s the unexpected that makes a subscription box appealing, and it’s what keeps subscribers coming back for more.”

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