Marketing
Custom Subscription Boxes: How to Gain Loyal Followers With the Perfect Unboxing Experience
  by:  |  Oct 25, 2019

More than a decade ago, online shopping was virtually non-existent. Today, the rise of internet access, mobile devices, and social media has changed the way we shop. From cosmetics and pet food to electronics and even engagement rings, you can now look no further than the internet.

Though internet shopping has come a long way, it takes persistence to keep an online business afloat. Not being able to meet customers in person pushes businesses to get creative with how they build their brand and encourage purchases.

A Look Inside the Subscription Box Industry

Up until five years ago, we had never even heard of subscription boxes. But since the market grew to 890% in 2014, small and large companies alike have jumped on the subscription box bandwagon.

In October 2018, there were approximately 3,500 subscription box services in the US, according to the Subscription Trade Association. The term “subscription economy” was popularized by Tien Tzuo, CEO of subscription software Zuora, to describe the trend’s impact in the last 3 years.

Businesses have embraced the subscription model because it's what customers are gravitating toward. @tientzuo Click To Tweet

Online-trafficker Hitwise reported that a record 18.5 million Americans visited at least one subscription box site in just the first quarter of 2018. This number keeps increasing, along with the growth of digital buyers. More than half of online shoppers say they subscribe to a subscription box service.

What Makes Them Subscribe?

This simple concept has become a phenomenon because it appeals to modern consumers’ desire for convenient, novel experiences. There are three kinds of subscriptions: replenishment, curation, and access.

3 Types of Subscriptions

Curation

According to McKinsey & Company, curation is the most popular with by 55% of the total subscriptions, which reflects the demand for discovering new products catered to their personal taste. These range from clothing, cosmetics, and beauty products.

Replenishment

Replenishment, in which the services deliver the same monthly commodities, comprises 32% of the e-commerce subscriptions.

Access

Access subscribers make up 13% of the consumers as individuals who pay a monthly fee to obtain prices or members-only perks, primarily in the food and apparel categories.

How long do they subscribe?

The report shows that 60% of subscribers are women, but men are more likely to have 3 or more active subscriptions.

While the market is steadily getting bigger, it is also changing at a rapid pace.

A study by Recurly examined over 1,500 subscription sites and found that more than one-third of consumers who sign up for a subscription service cancel in less than 3 months, and over half cancel within 6 months. Companies that experience initial success are having difficulty keeping their customers interested in an industry that has an 11% customer churn rate. 85% of these are “voluntary cancellations”.

Why Do Customers Lose Interest?

Subscribers cancel for a variety of reasons. Among the most popular are:

  • They see the box as a non-essential
  • Expectations were not met
  • The value of the box did not justify the price 

The results prove that buyers are not too conscious about the price of their subscriptions, but more on the experience each time they open their boxes.

What Do Customers Look For?

In this case, what’s inside does not always count. Ask most brands and marketers and they will tell you that the overall experience has just as much influence as the contents of your box in keeping your customers invested. John Fetto, senior analyst of Hitwise advised attendees at the 2017 Subscription Summit that personalization is key in keeping customers excited. 

Don't be afraid to ask for information from your consumer to help you deliver a more curated experience. @JohnFetto Click To Tweet
  • McKinsey reports that 28% of curation and exclusive access members want a personalized experience to keep subscribing
  • Dotcom Distribution’s study showed that 44% of shoppers who are not sure if they would keep the item said the upscale packaging could push them over the edge and confirm it was worth the price
  • In another Dotcom report, 61% of buyers would be much more likely to repeat a purchase with a brand that offered gift-like packaging

Market research company Global Web Index reported that there is also a rise of conscious consumers; 61% of those surveyed are choosing brands that deliver a social or environmental benefit

Packaging: The 5th P in Marketing

There’s a reason why unboxing videos have become so popular. Because they can’t physically inspect an item before buying, shoppers use social media to find a photo or video of a product to learn more before making a purchase. Packaging does not only convince consumers to buy, but it’s also a way for brands to reinforce their messages and values online. That’s why an ordinary box isn’t going to cut it.

  • Dotcom Distribution reports that 55% of online shoppers said were intrigued after watching an unboxing video
  • Global Web Index reported that 73% of U.S. consumers made a purchase based on sustainable packaging
  • 84% of UPrinting Facebook fans would share a photo or video on social media if they like the packaging.
  • 57% of UPrinting fans also agree that packaging is important for them to keep their subscription

 

Pay Attention to Packaging

Start creating your custom printed subscription boxes today. Our custom printed subscription box services let you customize every detail, from choosing a custom size, using sustainable materials, and executing the most intricate design.

Under Promise and Over Deliver

Deliver more than what your buyers expect by adding promotional items. Include brand stickers, postcards, and freebies that show you value their patronage.

Ultimately, customers are just looking for an exciting experience when they see the box at their doorstep. In the age of the internet, where we’ve grown detached and accustomed to less interaction, subscription boxes offer the surprise and emotional connection that many of us seek, but don’t usually get online.

What are your thoughts on custom product packaging? Start a conversation in the comments below.

 

Nermae loves to travel and see the world–unless she’s in Manila working as a writer. Despite starting in non-profit, she now works in design and marketing and spends her time illustrating, reading children’s books, and looking up cat videos on the internet.