Subscription Services: A Great Customer-Centric Business Opportunity
Thinking about a business that caters to increasingly diverse customer needs? If so, a subscription service could be the solution. Active subscription services are now common, but just a few years ago they were still an unfamiliar business model. Monthly subscription models once existed only in magazines. Since then, ...
Thinking about a business that caters to increasingly diverse customer needs? If so, a subscription service could be the solution.
Active subscription services are now common, but just a few years ago they were still an unfamiliar business model. Monthly subscription models once existed only in magazines.
Since then, a variety of “real product subscription” services have emerged to meet customer demand. These sometimes sent sample sets of new products to cosmetics lovers, or predicted and delivered wines or books customers were likely to enjoy.
The Google Trends interest graph for the keyword “Subscription box” clearly shows how active this business model has become.
As subscription services became more popular, they began offering new ways of consuming products across a wider range of industries. Companies have found that consumers are now willing to buy a variety of products for beauty, meal preparation, and pets.
Why do subscription services win consumers’ hearts?
First. Subscription services are convenient
The most important and obvious reason is that subscription services provide customers with great convenience. Buying and trying products you need on a regular basis can be a burden. If toys and food for a pet are constantly needed, customers must place orders and arrange deliveries themselves on a regular schedule. Or they may need to visit a store in person, buy the products, and carry them home. Subscription boxes reduce the burden by curating products for consumers and handling delivery as well.
In Korea, Bacon Box is gaining attention as a leading pet subscription box brand. It offers everything from toy boxes designed for dogs that love playing with their owners, to snack boxes featuring premium custom-made treats. It also changes the theme every month so consumers never get bored.
If you’re curious about custom boxes, read: 5 Tips for Creating a Package Design!
Second: Subscription services encourage new attempts
Source: Bada Meokja subscription service
Among fresh foods, seafood is strongly perceived as something you need to see in person before buying, and it is also troublesome to prepare. Taking this into account, Yamtable sells a cooking box called “Bada Meokja.” It delivers pre-prepped seafood, seasonings, and vegetables together with a recipe book, making it easy to put seasonal fresh ingredients on the table with little effort.
If you’re interested in packaging production, this is a must-read: Facts About Color You Need to Know Before Making a Package Box
Source: Tone 28
For customers who want to reduce waste by using the right amount of customized products as needed, Tone 28’s recurring cosmetics delivery is also helpful. Through a diagnosis of your skin, you can subscribe to products tailored by area and receive solutions based on your changing skin condition each month. With its motto of acting for the environment, the brand is also popular among users seeking sustainable consumption by reducing plastic usage in packaging.
If packaging production is on your mind, be sure to read: 2020 Packaging Marketing Trends Every Marketer Should Know
Third: Customers can save money
Trends in the beauty industry change rapidly, and the number of new products launched every month is endless. Buying new cosmetics can also strain customers’ wallets. Some subscription services help customers experience a variety of new products at a lower price.
Source: BoxyCharm cosmetics subscription service
For just $21 a month (about KRW 24,000), Boxy Charm delivers 4–5 full-size cosmetics worth more than $100 (about KRW 120,000) to customers around the world via international shipping. Boxy Charm uses the same box type as Packative’s packaging boxes. If you’d like to try creating a similar package design, use Packative’s free editor!
For new brands, this can also be a great opportunity to reach and promote their products to more customers.
If you’re considering packaging production, read this: 3 Reasons You Should Invest in Product Packaging and Boxes
Set your pricing and business model
Because subscription services are built on subscription curation, it is important to offer high-quality products at a reasonable price. Observe what services your potential competitors provide and what differentiates them, and analyze how you will price your offerings and which products you will highlight to compete.
Shipping methods are also important. For fresh foods or alcoholic beverages, fast and safe delivery is essential to build customer trust.
If you’re curious about custom boxes, see: How to Start a Subscription Box Business (Part 1 + Part 2)
Is box design important for subscription services?
Subscription services need to reflect a variety of trends and customer tastes, so packaging design is extremely important. Boxes that satisfy users’ preferences and spark curiosity enhance the customer experience (CX). In addition, if your target audience cares deeply about the environment, eco-friendly options can make customers trust your brand more.
Create your own subscription box at Packative!