The section that is the most useful for people considering new subscription services is about solving the right problem for subscription box success.
What Problem Does Your Subscription Solve?
Subscriptions are shopping with commitment. Subscribers have not simply bought a product, they have agreed to be automatically billed repeatedly for it. So you’re going to need to give them a reason to make the additional commitment, to subscribe rather than simply buy once.
Typically, ecommerce subscription services will solve a problem in one of three ways:
Replenishment subscription services. Subscription services make replenishment convenient. If a man shaves his face, he could consume razors, shaving cream, styptic pencils, and aftershave balms. Keeping these shaving essentials on hand might require a few trips each month to a local store. Or, he could subscribe to an ecommerce subscription service that will send a regular supply of these items right to his door. The latter is far more convenient, and may be less expensive.
A replenishment subscription service, in other words, makes it easy to restock consumable items. And it made Dollar Shave Club worth a billion dollars.
If you can find a replenishment niche, your ecommerce subscription company is likely to enjoy long customer relationships and a steady stream of revenue and profit. Find an item that shoppers purchase repeatedly and regularly, and make it easier to get that item via a subscription.
Discovery subscription services. Shoppers have a broad range of product options. As an example, think about the number of pet toys currently available.
You might choose a chew toy, a plush toy, or an interactive toy — yes, there are interactive pet toys. Each variety comes in a rainbow of color options from an army of manufacturers. There are toys for inside pups or outside doggies. In fact, there are simply too many options for a pet owner to take in.
A discovery subscription service, like BarkBox, helps shoppers find unique or interesting products in an ocean of product options. Each month, the subscriber experiences a new discovery to share.
If you can solve the product discovery and selection problem, you may have a viable subscription service.
Service subscriptions. Some ecommerce subscriptions provide an ongoing service. The classic example of solving a service problem might be Netflix. The well-known service lets subscribers watch movies or series on demand.
Some, if not most, software-as-a-service businesses could be called service subscriptions.
Find a service that your business can provide and let shoppers subscribe.
Here’s an example of a “discovery service” adding a replenishment component to their business.
Discovery: Try The World sends “country based” boxes to subscribers so that they can discover condiments and products from other countries, for example Spain, France, Italy, etc. I believe one of the reasons they are successful, is that they truly act as a discovery service, unlike many others that claim this mantle, but do not really deliver surprising discoveries.
Replenishment: Imagine my surprise and delight to discover they have added a stylish up-market replenishment subscription. They are calling it Pantry. Check out Pantry here.
This addition is nicely integrated into their brand and positioning in the marketplace, and serves as a fine complement to their main service.
Why Replenishment Is Rising
I think many of the smartest marketers in the subscription space have taken careful note of the billion dollar sale of Dollar Shave Club, (a pure replenishment play) and thought long and hard about adding replenishment to their product offerings.
I leave you with these thoughts…
- Are you truly offering your subscribers real and exciting discoveries?
- How can you profitably broaden your brand with a replenishment component,
like Try The World’s new Pantry box?