Subscription eCommerce services like Birchbox and Dollar Shave Club have certainly hit their stride. According to a new article from Multichannel Merchant, “The State of Subscription Box Services,” there are currently more than 2,000 subscription box services in operations this year and the amount of visits to subscription box sites has risen by over 3,000 percent in the last three years to 21.4 million visits in 2016.
But this explosive growth can also bring challenges in scaling subscription-based businesses. In fact, 13 percent of all retailers tracked by Subscription Addiction have already ceased operations. So how should retailers deal with associated growing pains?
Below are five tips for ensuring positive brand experiences and smoother business operations for subscription eCommerce service success:
1. Diversify Your Product Selection.Product fatigue can lead to cancelled subscriptions, so many brands choose to diversify their assortment over time to include complementary offerings. Diversifying your selection can also help attract new customers and grow your subscription base.
2. Pay Attention to Packaging.When a customer unpacks their subscription box, they are experiencing your brand – everything from package condition to tissue paper selection is part of that experience. These little things go a long way in keeping shoppers interested in your brand and subscribing to your service.
3. Factor in Package Complexity.When thinking about your brand elements, it’s important to understand that the complexity of packaging can greatly impact your profitability. Be sure to conduct packaging exercises to explore factors such as typical order size and assortment to determine ideal packaging materials and arrangements to control cost while still delivering your brand experience.
4. Consistently Cleanse Address Data.Data cleansing is a huge opportunity for eCommerce subscription companies. When a customer moves and forgets to update their address in the system (or inputs their address incorrectly in the first place), retailers are left with an undeliverable return and an unhappy customer. This can quickly become a logistical nightmare as you grow your subscription base. Address verification services are critical to ensure address accuracy, mitigate undeliverable returns, and maintain strong customer satisfaction.
5. Pick the Right Shipping Schedule for Your Business.There are two common methods for scheduling subscription shipments – recurring “shared drop dates” that are shared across all customers and “anniversary drops dates” that are specific to each customer. Both solutions offer advantages and disadvantages, which is why your shipment schedule warrants special consideration. In either event, a knowledgeable logistics partner can greatly assist with scheduling options as you consider what is best for your business.
As new subscription eCommerce services continue to launch in more markets, keeping your existing subscribers happy and loyal will become crucial to the success of your business. The key is to keep it easy and not over complicate what is intended to be a fairly simple business model, while creating a unique brand experience at each delivery.