In the e-commerce subscription market, finding a distinct segment is vital to success. For this reason, subscription e-commerce businesses often serve particular niches, from beard grooming and shaving, to food allergies and baby products. Subscription e-commerce businesses may offer a service in which they send the customer a different product, or range of products each month, such as BirchBox. Other companies offer the option to ‘auto-restock’ when ordering a specific product so that they can receive the product regularly. In this blog post we’ll outline the benefits of offering e-commerce subscriptions.
It’s easier to manager inventory
As a subscription e-commerce business, you will know what you are going to sell ahead of time. For example, if you have 150 subscribers to your gluten-free snack of the month box, you already know how many products to order from the supplier, and can even place your order months in advance. The ability to optimize inventory not only makes the process less stressful, but lowers your costs and may even get you a supplier discount.
Shipping cost is lower
A bonus of providing a subscription service means you are in control of when your deliveries ship, and can plan to send orders on a regular schedule — whether that be each week, month or quarter. As a subscription e-commerce business, you can choose to have a package take two weeks. The only thing your customer is concerned about is that the items arrive when expected.
Customer choice is kept to a minimum
You may be wondering how limited customer choice is a benefit of being an e-commerce subscription business. Well, we know that as customers, too many choices can paralyze us into leaving a website buying nothing. With subscription services, customers simply get what they’re given. Some companies, such as BirchBox, gift boxes offering products specifically for males or females, as well as offering them the ability to subscribe to various levels and different prices. But in general, the customer trusts the subscription service to make the important choices and enjoy the element of surprise.
Buyers are more easily identified
While BirchBox caters to men and women in their twenties and thirties, BarkBox caters to pet owners of all ages with higher incomes. Because of the specific products e-commerce subscription businesses offer and the particular niches they target, each subscription service knows exactly what they hope to accomplish for each and every buyer, and thus they are able to predict the types of products that will be more popular.
Check out this blog post for 10 great examples of subscription e-commerce businesses