We’ve all heard about the pros and cons of subscription box services. When you’ve decided that a subscription box business is the right route for you and your company, where do you start?
Subscriptions boxes are one of the best ways to shop, period. They offer consumers unique experiences curated around products, introduce new brands, and make checking the mail just plain fun.
On the subscription box business side, they offer a stable financial model rooted in recurring monthly revenue that can be built around almost every niche – from puzzlers to beauty to pets. If there’s an existing community around a product or category online, chances are you can build a subscription box around it.
How to Start a Subscription Box Business?
Start with a Great Idea
The start to any strong business is a good idea. And when it comes to subscription box business, what usually separates good ideas from great ones is specificity.
A niche is best understood as a small, specific market for products and services. An easy way to think about this in relation to a subscription business is to examine what would be inside your box. Think about the types of products your subscription would include – what makes these unique to others, and how do those traits define the values your box embodies?
Answering these questions is important because the more niche you are, the easier it is to curate and tailor products for a specific audience, enabling you to maximize retention and create a great customer experience. Marketing also becomes easier when you can zero in on a specific audience and know who you’re selling to.
Research your potential customer
There are many niches when it comes to subscription box business—all intended for specific audiences. And each element of the box must circle back to the main theme and benefit you intend to provide your customer. How will you make your box special for your specific niche? How can you make your box tailored to your niche, and keep items novel and interesting on a monthly basis?
A brainstorm can help with this: what are you interested in? What would your box have in it? What makes your box exciting and unique, and different from other boxes? How do the elements of your box circle back to your main theme?
Put together a Prototype box
A prototype is simply the early model of your product. It’s the physical beta-test of your subscription box, and it’s in this step that you’ll start to lay the foundation for customer experience.
Prototyping involves a number of considerations for new subscription box business owners:
- Size of the box: How big is it? (Psst. Think about shipping!)
- Number of items: How many items will you put inside each month?
- Safety of Products: Will you need packing material of some kind?
- Written content/packing information: What self-printed material will you be including in the experience?
- Design and Aesthetic: What type of presentation does your niche respond to?
- Visceral Experience: How are you integrating an experience into your product?
- Pricing: Make sure you can offer the box at a price customers can afford, but will also keep you in business.
Begin your presale campaign
Once your launch list is ready to go, you can start pushing people to presubscribe. It’s in this step that your store becomes live and you begin accepting payments.
Begin by scheduling compelling emails that target your leads list (your presubscribers!). Because you’ve been updating them once or twice a week, they’re eager to sign up, and have likely been counting down the days till launch.
On social media, consider doing a countdown partnered with giveaways and prizes for sharing notices that your launch is coming. This can provide some last minute traction in advance of your launch date.
It’s important to keep one thing clear during this first step: the first ship date. If you’re not shipping until 45 days after you first bill customers, then make sure customers know it. This reduces confusion, lowers customer service requests, and helps keep expectation in line (better for customer experience!).
Ship Your Boxes
In this step, you should notify customers of the ship date, make sure tracking emails are ready, and try your hand at last minute promotions and sneak peeks to encourage more subscribers.
Grow Your Subscriber Base
Going forward, the goal is to continue to scale your business. One of the most cost effective ways of doing this is through word of mouth referrals: customers referring other customers.
Numerous studies have shown that referred customers are often higher value and more likely to evangelize on behalf of your brand. Consider implementing a customer referral program, like the one provided by Cratejoy, that rewards customers based on the number of referrals they produce, ie. Every 3 referrals = 1 free box.
Moving forward, there are tons of possibilities with your subscription box business. You can continue to work on gaining subscribers for your box, or you can diversify your offering, and launch new boxes or offer one-time products.