The Subscription Box Market to Reach USD 63 Billion By 2028

What is Subscription Box?

Subscription boxes are a regular delivery of niche products as part of a marketing technique and a method of product distribution. Subscription boxes are used by subscription-based e-commerce businesses, directed to as “sub com” for short, which follow a subscription business model. They target many customers and cater to different specific requirements and interests. Subscriptions vary in cost and frequency, making them more available to clients with different socioeconomic backgrounds.

Growth Factors in Subscription Box

1.  Growing E-Commerce- Substantial growth in the e-commerce sector is anticipated to propel the growth of the subscription box market going forward. The e-commerce sector guides a business that involves exchanging products and services and sending money or data across an electronic network, most notably the internet. E-commerce involves constant packing and completion processes on a recurring basis to deliver subscription boxes to customers that can significantly improve the customer’s lifetime value.

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2.  Increasing Prevalence of Online Shopping Around the World- People are increasingly inclined towards online shopping due to the convenience it delivers. It allows them to shop safely from home and save time. The pandemic has further started the trend of online shopping as people avoided going out of their homes or isolation.

What is the covid-19 Impact on Subscription Box?

The covid-19 pandemic negatively impacted the lifestyle and eating habits of people. Many individuals turned to e-commerce as an alternative to in-person buying when social distancing measures were strongly implemented. The fast move to online purchasing during the pandemic allowed businesses to increase online income. Online buying for household essentials and everything from groceries to pet food will push subscription box services to the extremes.

Restraints in Subscription Box Market

1.  Overcrowded Market with Established and New Key Participants– Companies have overpopulated the market due to the lucrative income and market growth rate the subscription box model delivers.

2.  Discontinuation of Subscription– Occasionally the customers do not continue the service after consuming the discounts or recommendations the key player provides. It lowers the customer retention of the company, leading to imbalanced income.

3.  Costly Luxury Subscriptions- Luxury subscription boxes can range from USD 80-100 per month. Subscriptions like this are quite expensive, and thus people often cancel their subscriptions. It can be reversed for market growth.

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Types of Subscription Boxes are:

1.  Beauty Subscription Boxes. Beauty & makeup is one of the biggest industries in the subscription box example. They can contain products from a single brand or a spectrum of brands. They offer excellent exposure for lesser-known brands and are a useful DTC marketing implement.

2.  Food Subscription Boxes. Fresh meat, groceries, and snack boxes are a fast-growing segment of the subscription box industry. They’re a significant source of revenue for food suppliers and can help B2B suppliers join the DTC food market. Luckily, BlueCart subscription management software was created to grow food sales for businesses of all types and sizes.

3.  Coffee or Tea Subscription Boxes. Since coffee or tea people are careful about what coffee/tea they drink and normally drink daily, a coffee/tea of the month club is highly priceless. If you’re one of the best coffee/tea roasters or are examining a coffee marketing tool, knowing how to begin a subscription box for coffee/tea is an excellent option.

4.  Book/Magazine of the Month Subscription Boxes. The subsequent development of book clubs and book-of-the-month subscription boxes has been a nail of the industry for a while. They are favorably curated boxes that have a big influence on book sales. For burgeoning authors or publishers, they can help.

5.  Shaving Supply Subscription Boxes. Unsurprisingly, razors and grooming supplies are what many people think of when it comes to subscription boxes. That’s because they’re some of the most booming. People must buy the products multiple times yearly, so the box drives it easier. Even better for the suppliers, they can sell the products via dropshipping and never even have to spend for warehouse space.

6.  Pet Subscription Boxes. Another industry that depends on repeat buys is the pet industry. Monthly shipments of pet food, medicine, and toys are expected. Many large dog food brands are using subscription boxes to increase their sales. However, this industry must confirm they have good eCommerce packaging since their orders are often much heavier than others.

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Recent Developments in Subscription Box Market

·        In August 2021, The Hut Group acquired British online beauty retailer ‘Cult Beauty.’ The Hut Group is the parent organization of The Ltd. The investment obtains the active customers of Cult Beauty and its various beauty and self-care products. 

·        In May 2021, THG designed to invest in building industry-class food production facilities and creation to push its THG Nutrition portfolio. The Brighter Food team will increase the innovation and production of food bars. This result will, in turn, add to the subscription box market growth.

·        In December 2020, Barkbox, Inc., a top global company for dogs, declared that they had entered into a definitive merger agreement with Northern Star Acquisition Corp. The merger will result in the growth of their monthly subscription service.

Major Players in Subscription Box Market

The companies include, Inc., Barkbox, The Ltd., TechStyle Fashion Group, Loot Crate, Stitch Fix, Inc., Unilever plc, Blue Apron Holdings Inc., FabFitFun, Inc. and other prominent players in subscription box market.

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