eCommerce Subscription Services: How to Avoid Fatiguing Customers
by Ron Dod
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eCommerce subscription services have exploded in popularity over the past several years. As a result, a plethora of new online subscription box services have popped up online, offering consumers an incredible range of curated goodies.
Showing just how popular these recurring purchases have come,McKinsey reports that, “15 percent of online shoppers have signed up for one or more subscriptions to receive products on a recurring basis, frequently through monthly boxes.”
Such eCommerce subscription services offer consumers an individualized, convenient and often fun way of obtaining the items they want or need. Because of the industry’s explosion in popularity, the market has grown by over 100 percent since the beginning of the decade. In 2011, the industry generated $57 million, today that figure has climbed to well over $2.6 billion.
Such subscription services now constitute a considerable chunk of the total eCommerce market. Because of the success of the model, even traditional brick-and-mortar retailers are getting in on the game as Amazon, Walmart and Sephora have all launched their own subscription services.
However, despite the popularity of these subscriptions, quite a few companies that employed the model have folded. As the aforementioned McKinsey report also notes:
“Churn rates are high, however, and consumers quickly cancel services that don’t deliver superior end-to-end experiences.”
So, what makes an eCommerce subscription service successful?
Visiture analyzed some common factors among the top subscription services and obtain keen insights into these brand’s prosperity andcustomer retention strategies.
Check out these six lessons for building a profitable service that sidesteps subscription fatigue.
Clearly Serve a Specific Niche
As the saying goes, you can’t please all of the people all of the time.
Therefore, subscription providers should aim to clearly define their niche and carefully research the market to pinpoint an opening that the service could fill. With a unique value proposition, merchants can then craft messaging that speaks to the subscription’s purpose and why consumers would want to pay.
Bokksu is a snack subscription service dedicated to providing its customers with authentic, gourmet Japanese treats every month.
Danny clearly articulates what makes Bokksu special, why it provides a unique offering to the market and gives consumers an experience that they can’t get anywhere else:
“One of the easiest and most enjoyable ways to understand the food culture of any country is through its snacks. Bokksu, a monthly subscription box, delivers the gourmet flavors of Japan straight from centuries-old Japanese snack companies and makers to food lovers all over the world. You won’t find these curated treats at your local supermarket. By buying from Bokksu, you’re not only indulging your craving and curiosity for creative snacks, but also supporting traditional family businesses in Japan.”
Since launching the company, Bokksu has grown from 40 subscribers in 2016 to 10,000 by the end of 2018, earning over $3 million in revenue.
Because Bokksu provides its customers with a unique offering, the brand has been a hit since its inception.
Allow Customers to Try It Out
One of the most significant hurdles eCommerce retailers must overcome is ROPO (research online, purchase offline). A major reason for this phenomenon is that consumers cannot get a real “feel” for things through the screen. Therefore, they are hesitant to buy for fear they may get burned.
However, eCommerce subscription services have a bit of a competitive edge here as they tend to provide customers with charitable return policies or sample offerings. These types of contributions give consumers less of a feeling of commitment,making them more likely to convert.
For instance, Birchbox allows users to try a myriad of beauty product samples for a mere $10 monthly.
Such a low price makes consumers feel more comfortable given that the risk level is so small.
Sometimes, consumers get the feeling that shopping online is cold and impersonal. In many cases, they feel like they are trading away an experience for a convenience.
To help offset this, eCommerce subscription services must really wow with their products, and their presentation.
Therefore, professionally designed boxes featuring bold colors, fun packaging and creative fonts are a necessity as the arrival of the order must remind consumers how much fun the subscription service is for them. When customers get their subscription in the mail, it should feel like they just got a gift from someone special.
Presentation is one area in which subscription service Bokksu excels. As one customer reviewed:
“Beautifully packaged one of a kind subscription box. Full of delicious stuff, it’s a true journey to Japan culture throughout its gastronomic delights! Arigato gozaimasu”
Aiming to delight customers and provide aesthetics that buyers will adore makes them fall in love with the service all over again each month.
Personalize Product Options
Personalization is a prime component of any excellent eCommerce marketing blueprint. However, with subscription services, this aspect is particularly crucial.
In fact, as the earlier mentioned McKinsey report revealed:
“To continue subscribing, consumers (particularly curation and access subscribers) expect personalized subscriptions to become more tailored over time: 28 percent of both groups said that a personalized experience was the most important reason for continuing to subscribe.”
It is for this reason that subscription services like Blue Apron ask their subscribers for their dietary preferences. Using this information, the company creates personalized weekly menus for its users.
By providing a service that is customized to fit the buyer’s desires, sellers stand a far better chance of staving off subscription fatigue.
Ask Customers What They Want
For retailers of all sorts, understanding what customers want is at the core of success. The best way for sellers to know exactly what their customers are looking for is to ask them.
Therefore, eCommerce subscription service providers should produce questionnaires to get more intimately acquainted with what their customers think about their products, the service itself and other essential aspects of customer satisfaction.
This is precisely what Bark did to deepen its relationship with audiences.
Bark began back in 2012 with the subscription service BarkBox. Since the company’s founding, the brand has been continually asking its customers for feedback to better understand what they desire. As a result, the company began to design its own toys instead of purchasing them from other product developers.
Fast-forward to 2019, and over 90 percent of the SKUs the brand features are designed in-house at Bark.
However, things didn’t stop there. Continually probing their customers, the brand uncovered that consumers wanted to purchase items separate from the subscription box. In 2014, the company answered, officially opening a separate retail site, Barkshop.com, where shoppers can buy toys, treats, bundles and all sorts of other goodies that dogs love, without a subscription.
By staying close to customers and continually asking buyers what they wanted from the company, Bark has been able to expand operations multiple times over the years, ultimately building a doggie-centric empire.
Create Killer Content
Content marketing lies at the bedrock of a great online strategy. For this reason, many successful eCommerce subscription services provide their customers with added value via useful and entertaining content.
It was this partnership that drove Tiege Hanley’s co-founders to start creating behind-the-scenes style vlogs. By the time the subscription service launched its site, they already had a handful of videos on YouTube and roughly 5,000 followers who were eager to become full-fledged customers.
Additionally, since Tiege Hanley had been asking their viewers for feedback along the way (another strategy mentioned above), soon-to-be buyers had input on the company’s packaging, messaging and nearly everything else that might appeal to consumers.
Today, Tiege Hanley is a booming success. The brand’s content marketing efforts have certainly played a significant role in earning them a dedicated following and engaged customer base.
It’s easy to attribute the success of many eCommerce subscription services to the business model being a relatively novel and exciting thing for consumers. However, many of these types of businesses have crashed and burned.
The truth is that all of the successful subscription brands utilize some combination (if not all) of the tactics outlined above.
If your brand has, or is considering launching a subscription service, be sure to employ these strategies to help increase your chances of success. Also, be sure to check out howVisiture has helped brands like Tiege Hanley and BarkShop to enhance their profiles in the SERPs to earn more clicks and conversions.
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Ronald Dod is the Chief Marketing Officer and Co-founder of Visiture, an end-to-end eCommerce marketing agency focused on helping online merchants acquire more customers through the use of search engines, social media platforms, marketplaces, and their online storefronts. His passion is helping leading brands use data to make more effective decisions in order to drive new traffic and conversions.
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