Starting a subscription business — or any business — without consulting a true industry expert is a huge mistake. Numerous things can go wrong, and if you don’t talk to someone who can guide you around the pitfalls, you’ll create unnecessary challenges for yourself.
OceanX CEO and Founder Georg Richter was interviewed recently by Ben Kuo from SocalTech about decoding the secrets of subscription business. The interview was set up prior to the 2017 Recurring Revenue Conference where Georg will be speaking along with many other local Los Angeles companies in the subscription space.
Direct to consumer subscription programs continue to evolve and grow : Customers can sign up to have everything from razors to fresh food delivered right to their doors on a regular basis. Even services like music, private airlines, and even Cadillac cars offer subscriptions. But not every company is destined to ride the subscription wave to success.
OceanX was in Las Vegas last week for the second installment of Shoptalk, a conference blending the finest minds in commerce and technology. Word on the street was that Shoptalk was the place to be for all things retail, e-commerce, and digital. Expectations for this ‘next-generation commerce’ event were sky-high.
As we reflect on the 2016 growth, headlines and changes in the subscription and membership businesses that shape what we are calling the ‘New Membership Economy’, we also look forward to 2017 and anticipate what will be in store. We focus on subscriptions for physical goods so we are focusing these predictions on box subscriptions and memberships and not on the other SaaS and digital subscription models that are also a major part of the overall subscription economy. Here are our top 8 predictions for subscription box businesses for 2017.
From fresh food from Blue Apron to lingerie boxes by Wantable, there’s no question that membership and subscription programs for physical products are hot. Today, subscription commerce touches almost every retail product in the market. But where did it all start and, more importantly, how did the sub-scription economy become what it is today?
SHORT HISTORY OF SUBSCRIPTIONS: BASIC & LOCAL
When Robbie Kellman Baxter coined the phrase “the membership economy” in her 2015 book by the same name, she was mostly referring to the explosive rise of digital subscriptions and Software as a Service (SaaS) companies, such as Netflix, Adobe, and Spotify. But as we near the end of 2016, we are entering what we are calling, the New Membership Economy. The New Membership Economy is shifting to a new wave of membership businesses for physical goods that we use every day and help us connect to each other in unique ways that fulfill our needs.
There’s no doubt that we live in a membership world. You’ve seen the proliferation of subscription-based businesses explode in both the digital space (Netflix, Adobe, Spotify) and the physical space (Birchbox, Dollar Shave Club, Stich Fix). When launching or scaling a subscription commerce business for physical goods, it’s important to think about your goals and the customer experience from the outset. Will your membership program further and strengthen customer relationships?
Subscriptions and memberships have been around for a long time. We are experiencing a renaissance in physical subscriptions (boxes delivered to a household) – several thousand companies have been formed in the last 3 years and many like Dollar Shave Club are very successful. As opposed to old models, this time the customer is in total control.