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Subscription Boxes Must offer Surprise, Experience and Curation to Succeed

February 13th, 2017

There are several key types of subscription surprise box, some offer sample size products (common in beauty); some provide a selection of full-size products for the consumer to choose from and pay for only those that he or she wants (common in clothing), and some provide a selection of products that are not returnable.

Today, surprise boxes are becoming commonplace across a wide range of consumer sectors. Beauty was the trail blazer, but the trend has cross-industry appeal from everyday items such as fruit and vegetables through to education, niche interests and lifestyle boxes targeting specific hobbies or even beliefs. To some extent these boxes now have a global presence, although they are much more common in developed economies, especially the USA.

Boxes can be a win-win for business and consumer alike

For business, the model affords a guaranteed revenue stream – useful for planning, and a testing ground for new products. Most importantly though the model provides for a deeper connection with consumers, allowing the business to reap vast amounts of data and build a loyal consumer base.

For consumers, subscription boxes offer a variety of benefits.  From convenience and value through to exclusivity, expert curation and discovery.

Passing fad or sustainable business model?

The answer is a bit of both: many boxes have fallen by the wayside and the plethora of boxes available has led to subscription-fatigue. Many trade on discovering the new, and paradoxically this can become old pretty quickly for those with short attention spans. The surprise element, which is a strength of the subscription box, can also be a weakness, there is a balance to be struck with consumers often needing to have some control over contents. Those that succeed tend to evolve over time and build in additional revenue streams. For example enabling consumers to purchase full-size versions of the samples they receive in the box. Or they are conceived from the beginning as simply an additional revenue stream to a business which has complementary core operations.

Offering a point of differentiation is key – the box must be unique to stand out from the crowd. Packaging is crucial, as are personalisation and convenience.

 

For more on subscription boxes please read our Strategy Briefing: Engage, Return and Repeat: The Subscription Economy.

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Sarah Boumphrey

Sarah has 15 years’ experience in economic and consumer research. In her role as Global Lead of Economies and Consumers, she focuses on translating economic and consumer trends information into useful insight. Sarah leads the development of our macroeconomic and consumer trend content, with a special interest in emerging markets.

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