This is the era of digitization, and subscriptions are a great idea to attain more customers these days. Customers are more likely to take the service of subscriptions, whether it is for Netflix or a product they use daily. The subscription box business is the new buzz in the eCommerce industry as well, and brands are making most of it to expand their business and generate higher revenue. During the pandemic, the subscription box business has become a significant business idea for eCommerce joints. Customers prefer to take the subscription instead of buying the same product repeatedly. The eCommerce sales increased by more than 40% in 2020, and it is expected to increase by more than 60% by the end of 2023.
The reason behind this impeccable growth is that customers find it more convenient and worth the money. According to market experts, the subscription box business is a boon for eCommerce as subscribers spend more than two times compared to regular customers. However, if you are unaware of the subscription box business, this blog is meant for you. Here we will take you through the subscription box business and how you can take advantage of it for your eCommerce business.
What is a Subscription Box Business?
First of all, lets’ understand what a subscription is. In the simplest terms, we can say that subscription is a business model that allows customers to subscribe to a product or a service as per their requirements on a continual basis. Businesses mainly offer weekly, monthly and yearly subscriptions to their customers. Now, if we talk about the subscription box business, it is a business model that automatically ships out the customer’s product on a scheduled date. Subscription box business charges its customers on a monthly or yearly basis to continue their services to them. Customers prefer to get along with subscription-based services because they like to get personalized services or products. Subscription boxes are specifically popular among the young generations because they do not want to spend their time buying the same product repeatedly.
Hence, eCommerce brands can make the most of this opportunity to increase their revenue deliberately. To establish a subscription-based business, you need to offer something unique and robust to your customers that they might need in their daily life. More than that, you must represent your product perfectly on any eCommerce platform. For a perfect representation of your products, you can subscribe to listing quality analysis software such as etraKY BS. It can help you enhance your products’ images, descriptions, titles, etc.
Curation Subscription Box Business Model
A curation subscription box business model ships a choice of various products based on style and theme as per the customers’ preferences. It is the most basic SBB model that is quite famous among customers to buy apparel, gourmet food items, and beauty products. This subscription-based business model can help you to delight your customers by delivering them unique and personalized products. If you can provide top-quality products to your customers, they won’t hesitate to take your product subscription monthly or yearly. The curation subscription box business model can be highly profitable for your eCommerce business. It also allows you to promote new products and make them discoverable for your potential customers.
On the other hand, if we look into its negative factors, you may find it quite expensive because of its operational changes, including branding, packaging, and regular shipping. You should constantly update your stocks because a stock-out situation can put you in trouble. However, to escape such a situation, you can use stock availability software to keep an eye on your stocks and send your alert notification whenever a product gets out of stock or back in stock.
Replenishment Subscription Box Model
This subscription-based business model is about providing convenience and cost savings to the customers. The replenishment model refers to when customers replace products that they consistently use. This subscription-based model allows customers to automate their shopping for daily essentials such as razors, diapers, pet foods, etc. Several products do not need to be renewed regularly, so as a brand, you need to consider continuously selling those products that customers may require. In this business model, you can even sell a fresh new box of assorted vegetables and fruits.
You can even sell diet foods to those who prefer to follow an individual diet but fail to achieve their goals. This model has a higher conversion rate than the other subscription-based business model. On the other hand, the nature of the products that brands sell in association with this business model also helps in customer retention. However, to make it a successful affair, you must sell many products if you are acquiring this type of subscription box business model. We can say that profit margins are fragile in this model because you must sell many products at a lower price and offer discounts to your customers.
Membership Subscription Box Business Model
The name says it all, but we are explaining here what it is. A membership subscription box business model focuses on providing customers access to exclusive discounts and other perks. Amazon Prime membership is the perfect example of this business model. Customers not only get their products delivered as quickly as possible, but they also attain utmost satisfaction by purchasing a product at a discounted price. It is an excellent subscription business model to get along with to boost brand loyalty and increase your average order value.
Today Amazon, Flipkart, Myntra, Zomato, EazyDiner, and many other businesses are providing membership subscriptions to their customers. This business model attracts customers more than ever because they want to get the specific perks while shopping for any significant products from eCommerce platforms. This business model is a great way to build a great relationship with your customers and offer them an array of products in the future. However, this subscription-based business model requires an excellent time investment to offer something alluring to your customers to make their membership worthy.
Top Products Idea to Sell via Subscription Box Business
- Cooking boxes that offer customers the opportunity to make their new healthy dish with a given proportion of ingredients.
- Beauty products per the texture of the customer’s skin and daily beauty regime.
- You can also sell books, magazines, and journals daily, weekly, and monthly as an eCommerce brand.
- You can also sell baby diapers, baby foods, and products related to art and craft products on a subscription-based basis.
- Organic and gluten-free food products.
- You can sell daily grooming products for men and women, such as razors and sanitary napkins.
ConclusionSo, this is all about the subscription box business model you need to know initially if you want to get along with this trending business model. Suppose you want to try something unique to make your online business thrive. In that case, you can choose a subscription-based business model to attract more customers and generate guaranteed revenue. We are referring to guaranteed revenue because once customers subscribe to your products, they will only pay the total amount in the first place. You don’t have to face return issues or a common sale issue. No one can stop you from attaining immense success if you can serve well. All you need to do is take care of a few things, such as keep an eye on your stocks, enhance your product listing quality, and always watch out for your competitors.