Subscription E-commerce: The Marketer’s Hottest New Friend

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By: Amanda Markell

In this changing world of e-commerce, consumers can have the newest beauty products, organic food, pet toys, and fashion trends delivered right to the front door and tailored to their individual tastes and needs. They are calling it "subscription e-commerce" or "subcom," and it may be marketing’s newest best friend.

Thriving subscription e=commerce startups include:

BirchBox: for $10 a month, try out deluxe beauty samples based on your age, tone, style, skin type etc.
BarkBox: for $29 a month, receive 4–6 treats, toys, and hygiene products handpicked for your pup.
Craft Coffee: for $25 a month, taste test 3 4oz packets of top micro roast coffee; grinds are made the way you prefer your brew.
Healthy Surprise: for $33–$99 a month, receive delicious, healthy snacks that are vegan, dairy free, gluten free, and soy free.

So why is this the next miracle for marketing? Let’s take, for example, Birchbox and two brands that work with them: Color Club and Benta Berry. Ninety-four percent of subscribers were new to Color Club and 98% to Benta Berry. Now, Birchbox is the number one retailer for both. Brands are able to ensure sample delivery at an extremely targeted level. Not only can Benta Berry target a woman 40–50 years of age, but also one who has oily skin and prefers the "natural" look to the "done-up" look. Any company would choose this over forcing samples in the faces of passersby at the mall. Not to mention both brands now have a good deal of data about their customers.

Not convinced? After distributing a sample eye shadow palette with Birchbox, cosmetic brand Stila saw 11.2% conversion.

The industry is just beginning to realize the opportunities this business strategy holds with men. Consider it; he does not have to go to the mall, choose styles and colors, or even pull out a credit card (more than once). Automatic payments are made, the box comes to the front door, and razors, underwear, graphic tees, socks, and much much more are ready for him to use and wear. Startups like Manpacks and Dollar Shave Club have hit the nail on the head with the male target market.

The challenge now, with so many copycats popping up like wildfire: Will these leading e-commerce subscriptions hold the same power they do now? What do you think? Let us know @beneaththebrand.