Welcome to Parcelconsulting
Welcome to Parcelconsulting
We’re currently living in the heyday of subscription services. From streaming platforms to digital publications to members-only shopping experiences, there’s no arguing that the subscription model isn’t incredibly popular. Ecommerce has even seen its own surging growth of subscription boxes, which are curated collections of goods delivered to customers on a scheduled basis. Forbes has reported 37 million consumers viewed subscription box websites in 2017, and 5.7 million of them are subscribers across 2,000+ boxes. Those are healthy numbers no matter how you look at it.
If you’re looking to take a piece of the pie with your own subscription box service, start with researching successful brands. We’ll help you get started—these are five subscription boxes and what they did right.
It was 2012 when Dollar Shave Club released its now-legendary launch video that took viewers through a warehouse while narrating the many pain points of shaving. Personal grooming wasn’t quite yet an everyday topic of conversation, but Dollar Shave Club changed that. It also didn’t hurt either that its price of $1/month disrupted the shaving industry. The brand took a boring chore and created funny, relatable content that got people’s attention. Three years after its launch, it was acquired by Unilever for $1 billion in cash, making it one of the first direct-to-consumer unicorns.
What DSC did right: There are two major reasons Dollar Shave Club succeeded. The first is it identified a real problem, the cost and hassle of replacing razors, and created a solution. By offering generic razors at low prices, Dollar Shave Club brought innovation to an industry that had not seen any in decades. Second, DSC created a unique customer experience. The products themselves were not necessarily exciting, but there’s a certain delight in receiving mail and getting exclusive access to the Club.
When Birchbox was launched in 2010, it was a revolutionary concept. Beauty enthusiasts would receive samples of products without having to commit to full-size versions, and the curation process would help cut through the noise. Brands were equally excited to get their products in front of new customers and market via sending out samples. It was a more effective advertising method because the users could actually experience the makeup, skincare and other products being sold. Birchbox quickly grew from 200 initial subscribers to surpassing one million in 2019, showcasing the longevity of this simple idea.
What Birchbox did right: Birchbox started with an exciting concept and high-quality products that customers were legitimately eager to share with their families and friends. The brand’s referral program was user-friendly and incentivized, which undoubtedly supercharged its growth. Each box is also customizable, so customers receive products that fit into their lives, but the discovery aspect is still there.
HelloFresh was launched in Berlin, Germany in 2011 by Dominik Richter, Thomas Griesel, and Jessica Nilsson. The idea was simple: A week’s worth of ingredients would be pre-measured, packed individually and organized into meals then shipped to subscribers. All customers had to do was follow the instructions on the recipe cards to cook restaurant quality meals at home for a fraction of the price. The trio hand packed meals for their first paying customers, but the “meal kit” idea quickly took off. HelloFresh expanded to other countries in 2012 and reportedly had 250,000 subscribers by 2015. Despite not being profitable in 2015, its 2019 annual report showed a 38% year-over-year growth in order volume.
What HelloFresh did right: Cooking is a skill that few people learn and even fewer have time for. By delivering pre-measured ingredients and clear, simple instructions, HelloFresh made cooking possible for even the most culinarily challenged. Subscribers could feel confident in their ability to create healthy meals at home.
Founded in 2010 as an online magazine dedicated to beauty, fitness and fashion, FabFitFun is at its core a seasonal lifestyle subscription box service. Creators Katie Rosen Kitchens, Daniel Broukhim and Michael Broukhim sought to imitate the “swag bags” passed out at branded events, and they joined the subscription box market in 2013. The curators took the themes of the magazine and translated them into products that are, well, fab, fit and fun. Each FabFitFun box contains roughly $200 of full-size products (unlike the samples that Birchbox subscribers receive) but only has a $50 price tag. In 2018, the brand passed the one million subscriber mark and was generating $300 million in revenue, but the growth didn’t stop. FabFitFun has since developed year-round perks for members and exclusive access to 24/7 content in order to stay relevant.
What FFF did right: Like Birchbox, FabFitFun is centered around discoverability. There are millions of lifestyle products on the market, so there’s never any shortage of exciting items that subscribers can receive in their boxes. However, the team of curators helps to cut through the noise and send high-quality products that customers will love. Also, the seasonal (quarterly) delivery schedule means each box is highly anticipated and feels well worth the wait.
Sleep apnea affects millions of Americans, but treating it is frustrating. Most patients are steered toward continuous positive airway pressure (CPAP) therapy, which requires purchasing a whole equipment setup. The setup delivers filtered, pressurized air so the user doesn’t experience sleep interruptions from an airway blockage. Keeping all the equipment in tip-top shape requires daily cleaning and regular replacements, but it can quickly get expensive. Monthly CPAP Club alleviates this by delivering three months of equipment (mask, tubing and filters) per box but breaking the cost of the box down into three monthly payments.
What MCC did right: Like Dollar Shave Club, Monthly CPAP Club identified a problem that its subscribers were experiencing. They needed to regularly replace their CPAP masks, tubing and filters but were deterred by the hassle of dealing with sleep specialists. It was also expensive. The subscription service made treating CPAP less frustrating, and that convenience will keep sleep apnea patients subscribed.
Are you looking to start your own subscription box? Now might be the perfect time. There are thousands of boxes on the market right now, but there are untapped niches to discover. Research and curation is the first component of launching your box, so start with your ideas and look into competitors, ideal customers and products you can offer. Curating a box built around a distilled, niche theme can attract a small but dedicated following to maximize your customer lifetime value.
The second half of starting a subscription box service is based around fulfillment. How are you going to get your boxes to your customers? You have to consider shipping carriers, costs and third-party fulfillment providers if you don’t want to handle everything in-house. Don’t miss our ultimate guide to subscription box fulfillment for more details.
Parcel Consulting has aggregated and partnered with the best options for same-day, next-day local delivery in the United States and Canada. We work with businesses of all types and sizes to provide the best tailored local delivery options and technology for their needs.
We’ve been preparing for this for more than a decade and we’re here to help! Give us a ring to discuss your options at: 833-PARCEL-1 (833-727-2351).
