Subscription Box Services Yield Mixed Results

Earlier this year, we asked: What’s Ahead for the Subscription Box Service? Now, we have more information to answer that question. According to recent research, subscription box services yield mixed results.

So, what exactly are subscription boxes? According to Jameson Morris, an expert in this the field: “A subscription box is a recurring, physical delivery of niche-oriented products packaged as an experience and designed to offer additional value on top of the actual retail products contained in a box.”

 

Subscription Box Services Yield Mixed Results 

Yes, some subscription box services are doing much better than others. And the industry itself is in a state of flux.

One leader is Stitch Fix, “the personal style service that evolves with your tastes, needs, and lifestyle.” How does it work?

First,”Share your style, size, and price preferences with your personal stylist.” Second, “Request A Fix® Delivery. And get 5 hand-selected pieces of clothing delivered to your door. With no subscription required.” Third, “Buy what you like, send back the rest. Shipping is free and easy both ways. When you sign up for automatic deliveries, we’ll send you regular orders without extra effort from you. You choose how often that’s right for you: every 2-3 weeks, every month, every other month, or every three months.” 

As eMarketer reports:

“In fact, while some subscription box companies struggle to stay afloat, Stitch Fix’s number of active clients jumped nearly 10 times to 2.2 million as of July 29. Furthermore, a study from Hitwise found that online traffic in the subscription box space declined by 3% in September compared with a year prior. But Stitch Fix’s traffic didn’t: It more than doubled during that same period.”

The chart shows the subscription box leaders.

Subscription box services yield mixed results. Let's see who are doing best -- and who are struggling.

J.C. Penney Enters Subscription Box Marketplace

As with many other department store chains, J.C. Penney wants to embark on new activities. Why? To help turn around sales revenues. As a result, it is testing a subscription service. Will it succeed? Time will tell.

eMarketer reports that:

J.C. Penney has teamed with Bombfell, a men’s subscription service, to offer curated boxes to its Big & Tall customers. The service will work as many other subscription box services do. A stylist will curate several pieces based on customer preferences. But this partnership will offer Big & Tall sizes — something Penney specializes in — s well as pricing intended to undercut typical subscription box services.”

“Said eMarketer analyst Yory Wurmser, ‘As shopping moves online or to discount chains, mid-tier department stores need to find ways to differentiate their brand and create stickiness. A subscription service is one way. But I don’t see it as a game-changer. Instead, as a sign that the chain is thinking creatively about consumer behavior.'”

 

This entry was posted in Online Retailing, Part 2: Ownership, Strategy Mix, Online, Nontraditional, Part 3: Targeting Customers and Gathering Information and tagged , , , , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s