The rise of subscription boxes: top sales driving tips for brands and marketers
From food and drink to flowers, self care and everything in between, there’s a subscription box for whatever interests you or your loved ones may have. Over recent years, demand for subscription boxes has grown exponentially, and it shows no signs of slowing down. But what is driving this trend, and how can brands and marketers learn from it?
Who doesn’t love to receive something new and exciting in the post, especially when it’s tailored to your likes or interests? Well, with an array of subscription boxes suited to all tastes and hobbies, consumers can now experience that joy time and time again.
The power of the subscription box in the UK: tips, trends, stats and facts
According to a recent Royal Mail Subscription Box Report, the UK subscription box market is set to be worth a staggering £1.8 billion by 2025, an increase of 34.7% compared to 2020.
The pandemic certainly helped to drive the surge in demand over recent years, with 55% of subscription box consumers stating that they signed up for a subscription box service because they wanted to treat themselves during that time. Whether it’s a treat for yourself, or a thoughtful gift for others, the market shows no signs of decline and so there are lots of opportunities for businesses to tap into.
In terms of demographics, almost half (45%) of Londoners are signed up to at least one subscription box, followed by 37% and 36% of shoppers in the West Midlands and Northern Ireland. However, when it comes to the highest average number of subscription boxes per person, subscription box shoppers in the North East take the crown at 5.2.
Both large and small brands are seeing success with a subscription-based business model - from the Dollar Shave Club, bought by Unilever in 2016 for $1 billion, to Cheesegeek who recently received investment from entrepreneur Stephen Bartlett on Dragons Den - businesses of any size can connect with untapped audiences across any sector.
Saying that, the appeal of subscription boxes continues to be highest among younger shoppers, with 65.9% of 18-24 shoppers stating that they are signed up to at least one subscription box. As such, improving appeal and demand with older shoppers is key for continued growth over the coming years.
Let’s take a look at some brands who are doing well in the world of subscriptions, and what businesses can learn from them when developing their own monthly or even quarterly subscription offering.
How can brands and marketers use subscription boxes to drive sales?
Brands of all sizes can find success with a monthly subscription box business model, there’s huge scope for growth whether you’re a large corporation or a small independent. It’s all about finding your niche and connecting with like minded customers, then keeping them interested and coming back for more. But how? Let’s explore some tactics you can use to attract and retain customers.
1. Offer an element of personalisation
A great way to peak interest is by offering an element of personalisation, allowing shoppers to create bespoke orders tailored to their needs or wants. Take for example Birchbox, a beauty subscription service that allows customers to use Birchbox Select to choose from a range of products suited to their skin condition, complexion or hair type amongst other factors. This prevents them from feeling the products aren’t of interest or use to them, and keeps them coming back for more.
Leveraging personal data gathered through the sign up process, as well as ongoing insights into your customers’ preferences help you to attune your products and services to each consumer, ensuring high customer retention rates. CheeseGeek, who we mentioned earlier, is a brilliant example of a brand doing this well. As customers use the app and rate their cheese experiences, their data tool named Cassie gathers and analyses that data to shape future cheese selections based on what they like and don’t like. Bespoke cheese tastings, delivered right to your door? Sign us up!
2. Provide additional value
Another way to avoid losing customers is to provide additional value to their subscription, as seen with Beerbods by Beer Hawk. Not only do subscribers get eight beers every two months delivered to their door plus all of the information they need to get to grips with the story behind the beer and where it comes from. They also host a live tasting across their social media channels each week, adding a social element to their subscription, where like minded individuals can connect and chat about all things craft beer.
A great way to entice potential subscribers is to offer consumers an incentive for signing up rather than simply making a one-time purchase. Consider offering the product for a cheaper price should they agree to a rolling monthly subscription, or you could even throw in a limited edition gift - after all, everyone loves a freebie!
3. Be convenient
Lastly, flexibility is important for allowing customers to adapt their subscription to their lifestyle, with convenience a key driving factor in purchasing what you're offering. Meal delivery services such as Hello Fresh and Gousto have options for skipping boxes due to holiday, financial changes and plans to eat out, amongst others. This feature means that shoppers can incorporate the service into their lives seamlessly, without having to continuously cancel and re-set up profiles.
The easier it is for your subscription service to slot into the lives of your consumers, and the greater the value you add to their lives, the more likely they are to remain loyal, spread the good word or even buy your services as a gift for someone else.
Top tips for marketing your subscription box service
1. Step up your social media
When it comes to marketing your subscription boxes, social media should play a key role in your strategy across both paid and organic activity. It’s a space where you can create your brand voice, raise awareness about your products and engage with consumers, and so is key when it comes to customer acquisition and growing your customer base.
Success stems from finding and connecting with like minded people who have an interest in your niche, and showing them how your box would add value to their lives or make a great gift for someone special to them. Having a clear and distinguishable brand on social media will help differentiate you from competitors, and so investing in your brand development ahead of social media activity is paramount.
Social media is a brilliant tool for not only finding potential customers, but also curating your own community and learning first hand what it is they want to see in your boxes. Finding where your customers are, whether that be TikTok, Pinterest or other social media platforms, will help shape where to focus your efforts. From there, you can get creative with your output.
From influencer campaigns, to stylised imagery and video tutorials, use a combination to see what connects best with your followers. Consumer reviews and UGC works well as a part of your paid social activity to drive shoppers to your site, while organic can be used to show off more of the brand and latest product drops. As such, both play a key role in customer acquisition, moving consumers along ‘the messy hexagon’ (an updated version of the sales funnel), and towards making a purchase. From a paid perspective, it’s important you budget for both paid media and influencer / creator campaigns, as both ad types work differently when it comes to building your customer base and driving sales.
Flower delivery company, Bloom and wild, use their paid social ads to promote discount codes for new sign ups, while their organic activity incorporates video tutorials on how to arrange and prolong the life of their flowers. Their recognisable style of beautiful lifestyle shots showing the joy their flowers spark, pastel-toned branding and #CareWildly hashtag is easily recognisable while scrolling through your news feed.
2. Build your email lists
As we’ve mentioned previously, providing additional value to your customers is a great retention strategy, and email marketing provides a brilliant opportunity to do so. From top tips to subscriber exclusives, making the most of your email lists is key in keeping your customers interest piqued. From the latest products going into your box, to meeting suppliers, tutorial videos and personalisation options, be sure you’re utilising that direct line of communication you have with your customers and driving a reoccurring revenue stream.
3. Utilise PR opportunities
PR is an excellent tool to feed the sales funnel, build brand awareness and help cement your position as the experts in your field. Coupled with strong on-site content, and aligned with social media output, it will provide multiple ‘opportunities to see’ for your audiences as they move around on and offline. From comment opportunities to informative and educational articles, work to secure coverage in key publications where your audiences are. Not only will this help with backlinks to your site, it will also build your brand reputation so that when the time comes for someone to purchase a subscription box either for themselves or as a gift, you’re already in the back of their mind.
4. Remember your remarketing strategy
There are different methods for retargeting depending on where consumers are in the customer journey.
You can bring potential customers back to your site, including those who visited via blog content and PR, who may have dropped off before subscribing using retargeting ads. Across Facebook, Instagram and TikTok, why not try retargeting those people who have visited your website, but who have not purchased a subscription from you in the last 30 days to remind them of all the benefits your boxes provide?
You can also use Google ads, though it’s important to note the value in understanding where your customers are. A proportion of your customer base may be using other search engines instead of Google, such as Bing, where you can often secure cheaper CPCs and higher click through rates due to less competition from other advertisers. Or, they may be on Instagram but not so much Facebook. Once you know where they’re most likely to be browsing, you can use a retargeting strategy to build upon initial interest, and drive shoppers down the customer journey.
Alternatively, you could use your first party data to reach out to them with an abandoned cart email, gently reminding them that they left something in their basket. By highlighting what a great product or service you have — and potentially even offering further discounts to help them make up their minds — shoppers are more likely to reconsider and complete the sale.
Remember not to be too pushy though, getting your tone right is key in enticing them back in rather than putting them off the sale.
Do you need help directing shoppers to your subscription box service, or retaining existing customers? Get in touch, our team of experts are on hand to help you every step of the way.
Want to have a chat about your next marketing campaign?
Whether she's creating some incredible blog content or identifying another awesome PR opportunity, Nuala is always looking for ways to grow our clients' brand awareness. With a degree in marketing from Sheffield Hallam, Nuala joined team Extreme as a Marketing Executive, then making her home in the PR and Content team.