monthly-subscription boxes

Monthly Subscription Boxes Are All The Rage!

A Spotlight on a New Business Dependent on Mail-Order Fulfillment.

I have a successful coffee subscription box business that focuses on fresh coffee from small-market areas like Hawaii, Mexico, Bolivia and Ecuador (among others). We have a large subscription base and the drop-off is minimal. What most people don’t know is that it took a long time to get here, and my first business was an unmitigated disaster.

Years ago I tried to start up a monthly-wine club business. It was a great idea: wine and chocolates, delivered to your door, every single month. I could see lots of adult couples, single women, wine collectors and more subscribing and getting a new bottle of wine every month. I thought I was a genius.

loot crate coupon code
Dollar Shave Club is leading the charge in a whole new industry.

Well, in six months it went belly-up. Partly it was because (I found out later) there are several restrictions on buying wine online in a dozen states, which severely limited my market potential. But mostly, people weren’t really interested in the monthly subscription plan. People wanted to go to the store when they had an impulse and pick out the wine they wanted.

As it turns out, I was just way ahead of my time.

It first started with amusing advertisements for BlueApron. com.

Now there are hundreds of cool subscription boxes to choose from. From Graze (offering four healthy snacks with each box) to Birchbox (offering beauty products), it seems like everyone is discovering that the convenience of subscription boxes is totally worth it.

And why are people flocking to subscription boxes now? As opposed to ten years ago for my wine business?

Free Shipping. And Fast fulfillment. Fulfillment services like the ones this website represents are the reason these businesses are becoming so popular. You can subscribe and be absolutely certain that each box will arrive on time, for free, and there will be absolutely no cash-on-delivery or any other nonsense that used to kill the package delivery industry in the past.

Pretty nice, right? It’s amazing how if you work hard to remove a lot of the hassles your customers experience, you will open yourself up to growth like you never imagined!

What Can We Do To Keep Improving?

There’s three ways: keep it free, make it faster, and make it higher quality.

We have developed some very cool subscription boxes that keep sensitive materials from breaking during the shipping process. If we continue to develop this technology, the wide range of products that can be offered in this industry will continue to expand.

Make it fast: we can always work on assembling these gift boxes faster than we do now. We can’t make the delivery companies move faster (although they are working on it too!), but we can go from customer order to parcel pick-up in as little time as possible.

How Subscription Boxes are Threatening Daily Deal Sites

Livingsocial and Groupon are being given a run for their money.

Back in 2011, Daily deal sites were in their heyday. People signed up in droves, people begged for these companies to start offering daily deals in their cities.

Even with the explosive growth, there were trouble signs from the very beginning. Small businesses were claiming that their Groupon promotions had run them out of business, or that their payments from Groupon were months overdue.

While Livingsocial has begun to offer you a promo code just to incentivize you to stay with them, Groupon has more or less moved on to become a generic coupon code website (a la Retailmenot.com), which gives them much steadier revenue (and profit).

Nowadays The Daily Deal Sites Are Way Past Their Prime:

daily deal sites vs subscription boxes
Past their Prime?

It’s not difficult to view subscription boxes in a similar light: a simple business model that relies on people’s enthusiasm for products. But subscription boxes differ in some very important respects.

Convenience: Dollar Shave Club, which may be the biggest subscription box business, offers customers something they can sign up for and forget about forever.
It gives the company a recurring source of revenue that they can rely upon, and it gives customers a monthly package (people love getting packages!). Since people are always going to be growing hair, it means these customers can be loyal for decades (potentially).

Control: Instead of going to Walmart and finding the best shampoo that they have in stock (for example, ‘shampoo’ could be anything), customers will instead research and find the shampoo that really speaks to them. It may be a natural organic shampoo made by an artisan in the mountains of Montana, or something like that. But to the customer, they have a product that no one else has (uniqueness), and to support local artisans means you can be philanthropic with your consumption as well.

Will Subscription Boxes Fade Away?

It may not be difficult to look at the subscription box craze and wonder if we have peaked. But we don’t think that they will start to fade the way daily deal sites have.

For one, daily deal sites are an insanely easy business model to copy. You can’t patent ‘daily deals’, and there are thousands of Groupon-imitators out there right now all over North America.

Subscription boxes are easy to imitate, but they is no big ‘Groupon’ in the subscription business. In fact, its a way to expand income and customer loyalty among nearly every existing business. Nearly any business could start up a subscription box of their products and mail them out every month, or every three months.

It’s essentially a new way for any business, anywhere, to sell more products. Isn’t that awesome?