Subscription box services are finding a lot of success today because they can offer a solution to a recurring need or problem with the convenience of home delivery. Subscription services are not a new phenomenon. Think back over the past few decades at how many offices you saw with water coolers that were routinely delivered.
However, they have certainly picked up steam in recent years. As of 2018, there were 7,000 subscription box companies globally, nearly 70% of which reside in the United States. It is expected that by 2023, as many as 75% of ecommerce businesses will offer some sort of subscription option.
You can see that Amazon has already jumped on the bandwagon offering subscription options for many products, and if Amazon is doing it, you know everyone will be.
Many popular brands like Chewy offer recurring deliveries for commonly consumed products like dog food and pet medications.
It’s not just companies offering necessities to consumers that are thriving in the subscription service area. We featured some great novelty subscription boxes in our favorite subscription box services article. They offer everything from a monthly at home murder mystery story to toys for children to cannabis products.
If you have a product idea that you think people wished could be delivered to them on a recurring basis or that would make their life easier by being shipped to them regularly rather than having to go looking for it at a store, you may have a good idea for a subscription box company.
However, it’s going to take a lot more work to go from a good idea to a real business. These are some steps you will want to take to get you closer to launching a business.
Identify What Makes Your Service Stand Out
Some would say this is identifying your niche. A niche is a unique market within an industry.
For example, Chewy was mentioned above. They are well known for selling dog food online.
You probably would not want to go head-to-head with them starting out, but is there a niche within the dog food industry that you could carve out?
Maybe you offer only organic dog food or a blend of food for dogs that suffer from a common problem.
Instead of toothpaste, you make toothpaste for people with sensitive teeth. Instead of soap, you offer soap for people that are allergic to a common ingredient in soap.
Whatever the case may be, if you can carve out a specific niche within a market, you will have a better chance of success.
You want to choose a product that is in demand and that people use regularly or would like to use regularly. Think of things that people buy daily, weekly, or monthly.
Then you will want to identify where your customer is getting those products from now. Where do they shop? How do they search online for the products?
What are the pain points or questions you can answer to get the attention of searchers online?
Semrush is a great tool for helping to uncover and understand what kind of search queries people are using to find your products.
Where Are Your Products Coming From?
Are you going to design products yourself? Who are you going to partner with for manufacturing? Or is there a solution already out there you can use?
Figuring out how you are going to either acquire your products or manufacture them yourself is an important step in the process.
Can you partner with local stores or suppliers? Can you find a solution on a global marketplace like Alibaba that sells items in bulk?
It’s also important to test the products. Whether you are manufacturing them yourself or using someone else’s design and slapping your brand on them, your products represent your business. Have friends, family, potential customers all test the product. Gathering feedback around what they like and dislike can help you to fine-tune the product and it can help you in figuring out how best to market it.
Design Your Box
If you really want to stand out, utilizing custom packaging can enhance the customer experience. And that is exactly what you want your subscription box to be. An experience.
Using custom packaging will help you to build your brand. You may also get some free social media exposure out of it if customers decide to show off their latest delivery.
Build a Website
Next, you are going to need to get a website set up where you can take orders. There are plenty of great platforms to choose from. Shopify and WooCommerce are two of the most popular and user friendly.
Whichever platform you choose, you will just want to make sure they support recurring billing. You don’t want to make your customers have to log in to pay for their order each delivery. That defeats the whole idea of the subscription business model.
Plan Your Order Fulfillment
You have a product. You have your packaging designed. You have a fancy new website. Now you have to figure out how you are going to get your inventory into the hands of your customers.
It’s not just shipping you have to manage. It’s inventory, storage, picking and packing, shipping, and customer service issues such as lost packages and returns.
You can either handle all of this in-house or you can look for a logistics company that offers subscription box order fulfillment services.
If your subscription box is a collection of different products for each shipment, such as what Lootbox offers, an order fulfillment service may not be the best option to handle it.
On the other hand, if your shipments are the same each month or a small collection of products like razors, coffee, or dog snacks, a third-party logistics company like ShipBuddies can help by taking care of fulfillment tasks, handling customer service issues, and helping you to speed up your shipping while reducing shipping costs.
Ready to Get Started?
If you think you are ready to get your subscription company off the ground, the next step is to start your marketing rolling. Be sure to check out the 4 ecommerce marketing strategies for 2021 we shared to help you get started.