What Makes A Good Subscription Box Business?

Since writing about my subscription box business on the Sellbrite blog, I’ve had a few emails from people asking me if their ideas are good. While I’m flattered that people care so much about my opinion to hunt down my contact information and get in touch, I feel slightly unqualified to start offering out advice like that. My expertise lays very much in the UK beauty industry; take me outside of my comfort zone, and I’m fairly unknowledgeable.

That being said, the emails I received got me thinking. I realized that every successful subscription box business out there shares the following three things:

1) A large fan base

Birchbox

Most women I know wear makeup. In fact, I think my Mum and my grandma are the only two ladies in my life that don’t wear makeup. I know that’s not particularly scientific or a statistically sound argument, but it means that a lot of women out there wear makeup. So, it stands to reason that there’s huge demand for makeup and cosmetic products from women. Birchbox has a gargantuan market to target their boxes to.

Dollar Shave Club

Not many men are “fans” of shaving, but let’s just say it has to be done – for a plethora of reasons. Dollar Shave Club offers a practical solution to men who need to remove hair from their face with minimal fuss. I doubt Dollar Shave Club has many “fans” in the true sense of the word, but it has millions of potential customers and hundreds of thousands of subscribers because it caters for a real need.

nailbox

I’ve cited my subscription box because I want to demonstrate the thought process I went through when launching it. There’s a huge nail fan base out there – there are thousands upon thousands of nail blogs from around the world, where bloggers publish swatches and posts talking about the latest nail colours, products and brands. Sure, the nail market isn’t quite as big as the market that Birchbox cater for – or even Dollar Shave Club, but it’s still rather sizeable!

2) Recurring need

Birchbox: It takes a brave lady to turn round one day and say “I’m not wearing makeup any more!”. With that in mind, most women have a need for makeup on a constant basis. When their old makeup runs out, they need to buy more.

Dollar Shave Club: Soon after starting to grow a beard most men will find that the “midlife crisis” jokes start. Those jokes are always a sign that you need a shave, ASAP! Men’s beards grow constantly, so razors will always be needed to remove those beards – or at least keep them in check. There’s a recurring need for the Dollar Shave Club’s product because nothing is as time or cost effective as a razor when it comes to shaving.

nailbox: Most ladies like to paint their nails on an on-going basis. Nail polish bottles aren’t bottomless, and using the same colour over and over can be construed as a little boring. That’s why there’s a continuous demand for nail polish, because bottles run out and because people want the correct colours for the season in question.

3) Evergreen content

Birchbox: It’s easy to see how Birchbox is evergreen, makeup never goes out of fashion. Some “looks” and products may come and go, but makeup will always be a staple of a woman’s handbag.

Dollar Shave Club: From the day a man starts shaving, he’ll usually have to do so for the rest of his life. There’s no easy way to get rid of or prevent facial hair, the only answer is for a man to shave. Once a man starts using razors, he’ll use them forever. Dollar Shave Club has the potential to fulfil a man’s razor requirements for life.

nailbox: Most women will always want their nails to look good. Sure, some people may go through phases where they can’t muster up the energy to paint their nails – but on the whole keeping well-manicured nails is an on-going process. Nail polish, products and treatments will always be popular.

4) Element of discovery (optional)

Birchbox: One of the great things about cosmetic subscription boxes like Birchbox is the fact that subscribers have the ability to discover new products – products they may not have otherwise tried. Remember being a kid at Christmas? Well, that’s kind of what it feels like when you’re signed up to a subscription box.

Dollar Shave Club: OK, you won’t discover anything life changing in your next box from Dollar Shave Club – and that’s fine, because no one expects to discover anything with this subscription box. While the discovery element of a monthly subscription service is a huge plus, Dollar Shave Club is a prime example of a wildly successful service that has thrived without that string to its bow. Don’t assume your box has to surprise people – Dollar Shave Club proves you don’t necessarily need to.

nailbox: Like the beauty and make-up boxes out there, nailbox allows subscribers to discover new shades, new ranges, new brands, new treatments and new nail tools. There’s a whole lot to discover in the nail industry because the market moves so fast. The difference between nailbox and other beauty boxes however, is that discovery isn’t necessarily the main or only reason people will subscribe to it – the fact it includes ‘on-trend’ colors, without subscribers having to lift a finger to get them, is also a huge selling point.

While successful subscription services almost always adhere to the first three points above, point four can be omitted providing the box offers enough value to meet an evergreen requirement or demand.

My new favorite subscription box business

As a little aside, I’ve been looking at lots of different subscription box businesses and websites over the last few months. A few make me think: “dang, why didn’t I think of that?!” Some make me think: “Wow, OK, that’ll never work – but I hope it does!” And others leave me thinking: “That’s pure genius!”

Today I saw the Discovery Club – a box from a UK ecommerce business called The Fragrance Shop, they specialize in selling mid to high-end perfumes. The Discovery Club is a quarterly box full of the latest perfume samples – it costs just £5, which is about $8.

The reason I think this box is genius is because the samples included are most likely free for the company to procure, and it’s a great marketing platform because the box includes vouchers to redeem against full size bottles of the perfumes, on The Fragrance Shop’s website.

So, in effect, customers are paying The Fragrance Shop to market fresh new scents to them. I’m sure you’ll agree, that’s absolutely brilliant!

If you have an existing ecommerce business then bolting on a subscription element could be the perfect way to build a steady stream of income, while marketing your products at the same time. As long as the subscription element ticks the boxes above, there’s no reason why it can’t be a success.