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Weekly Trends & Takeaways: Subscription Model

Bacon of the Month Club for Valentine's Day? Or Panties of the Month?

Regardless of what you sell, your company may just have a big opportunity gift right under your noses. Continue reading for more on what the publishing industry did right and what we can learn from subscription-based business models...

Trend: The Return of Subscription-Based Business Models

Established by the publishing industry with magazines and Book of the Month Club, many retailers looking to break into an already-competitive market are turning to the subscription model. Rather than selling a single product and hoping for the customer to return for more, ecommerce sites such as Panty by Post, Men are Useless and Blue Bottle Coffee Company are hoping larger single receipts through subscription packages are the answer to bigger returns.

Examples Include:

  • Specialty clothing – French lace underwear, organic cotton socks, belts
  • Food, wine, pickles, beer, local dairy, Chicago pizza and candy
  • Quarterly product sample kits –perfume, cleaning supplies
  • Cosmetics – eyeshadow of the month, lipstick of the month
  • Annual subscriptions in order to access free/quicker shipping (Amazon Prime)
  • Craft kits for children, or kits for specific hobbies such as quilting or model airplanes
  • Dog toy of the month, dog leash of the month

Counting on new customers to purchase twelve times the amount of product can be a big leap. In order to do so, convincing them of the value of their purchase is key. Rather than just focusing on potential savings of buying in bulk, it’s important to highlight benefits of the experience. The customer’s expectation of products being shipped regularly, and their positive experience of being surprised, creates an emotional value. Many online subscription-based services have built a bad reputation by making it difficult to cancel, so it’s important to also spotlight customer service and quality.

How To
All of the businesses mentioned in this article, aside from Amazon, were discovered through blog posts and social media sharing. If you have a special hook, such as humor or underserved target audiences, get bloggers to talk about it as much as possible and share product videos. Then push people to join your social media pages and mailing lists in order to remind them of your value proposition.

Just think of how many specialty magazines still exist, despite the publishing industry’s downturn. There’s an audience for everything, and like Cat Fancy magazine, I think I might offer a kitten of the month club if there are enough takers… Anyone?

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