Here’s an important report from E consultancy.
One of the hottest trends in online retail in the past several years has been subscription commerce.
Much of the boom has been fueled by the rise of subscription box services that deliver products on a regular basis in a pretty little (or big) box.
Typically, these services are focused on a particular product category, such as healthy snacks or children’s books.
One of the poster children for subscription box services is Birchbox, which sends its subscribers five beauty product samples every month for $10 per month, or $110 per year.
Birchbox, like many subscription box services, adds a touch of personalisation, tailoring the samples it delivers based on profile information supplied by its customers.
The model has been a hit with consumers. Birchbox’s customer base reportedly eclipsed the million subscriber count, producing a business generating eight-figures in revenue each year.
But all is not well … for Birchbox, and perhaps the industry.
But, as Bloomberg’s Kim Bhasin and Polly Mosendz recently detailed, “Birchbox [found] cute boxes filled with makeup aren’t enough.”
The company laid off staff earlier this year, and launched a traditional brick-and-mortar retail effort.
But this week, the company laid off another 12% of its staff, suggesting that Birchbox is finding it more difficult to live up to expectations than it had hoped.
With volatile public markets and no funding since 2014, Birchbox is not in an ideal position. And neither are its many competitors and copy-cats.
As Forrester Research analyst Sucharita Mulpuru told Bloomberg, “Expectations have been too high. We’ve seen this story before…”
Read whole story here. There are many important points covered!