Consumer packaged goods’ e-commerce sales skyrocketed by 42 percent in 2015, with most of that growth fueled by Amazon Prime sales. That same year, Amazon’s Subscribe & Save grew 200 percent year over year and accounted for more than 20 percent of all CPG growth.
Subscription box services are here to stay, and they’re only gaining popularity. Consumer retail insights found that visits to popular subscription boxes’ websites have increased by a whopping 3,000 percent in just three years. What started out as niche companies delivering specialized products to consumers’ doorsteps has developed into a multibillion-dollar industry.
This article was written by OceanX CEO and Founder Georg Richter and first published by InnovationEnterprises.com.
Venture capital investors eagerly invested more than $1.6 billion on companies joining the new membership economy by starting subscriptions. Blue Apron, BarkBox, and Ipsy, to name a few, have all benefited from these funds, enticing investors with the promise of repeat customers making recurring purchases.
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