The custom subscription box is quickly becoming the preferred subscription option for millions of consumers. Looking back to a decade ago when it was in its infancy, it was hard to predict that custom subscription boxes, also known as curated boxes, would constitute 53% of all subscription products.

Why has it grown to become the consumer's preferred subscription box option and how can you leverage this subscription model to grow your business? Before we get to that, let's summarize what a custom subscription box is.

What is a custom subscription box?

A custom or curated subscription box is a type of subscription box service that gives merchants the freedom to pick a group of products to deliver to customers periodically with an element of surprise. This is accomplished either by using historical sales data or by having customers fill out a survey or quiz outlining their preferences.

Today, consumers are spoilt for choice when it comes to picking a place to shop as well as a range of products to choose from. This abundance of options only makes it more challenging for consumers to find the right product; some call it the paradox of choice.

Given the endless product catalogs offered by retail giants like Target and Amazon, it is simple for customers to become overwhelmed and decide not to make any purchases.

By choosing a select few products that meet a customer's demands, custom subscription reduces friction and anxiety while saving customers hours of time-consuming internet shopping. From food to books and beauty products, curated subscription has appeared in a variety of product categories.

Customers literally pay a brand in this subscription-based business model to customize their offering and carry out the product discovery process on their behalf.

The driving force behind custom subscription

Customization

A major reason why custom box subscription has become so popular and a preferred option is because of the very personalized experience it gives merchants the freedom to pick products for their customers using their shopping habits. It’s like having someone shop for you and trusting that they know your taste and most preferred options. In this case, customers leave their shopping in the hands of the brands they trust when they subscribe to a custom box plan.

While you'd think merchants might get it wrong with choosing products for their customers, the reverse is the case nearly all the time. Subscription apps like Chargezen use intelligent product recommendations that study your customer's shopping habits to help you make the best choice for your customers. And the best part? Merchants using the curated box feature of Chargezen leave their customers surprised and delighted with every box.

Variety

Repetition can be boring, and that is in fact the reason replenishment subscription gets boring for some customers. But by using custom box subscriptions, you can provide your customers with options for everything and spice up their shopping experience every now and then.

Due to the way the custom box subscription model is designed, merchants are at liberty to get innovative when curating subscription boxes for their customers. And selecting primary products isn't the only way to go about it; you can also include variations of the same products that consumers would not so often find on their own.

However, to ensure that you don't lose customers while innovating, you need to ensure that you're offering your customers the best value possible when you're selecting products for them.

Target audience

According to a recent McKinsey & Company survey, a larger population of your custom box subscribers are typical young stylish millennial men and women who enjoy trying new things, are interested in arts, enjoy online shopping, and value product recommendations or reviews.

But this isn't just about the McKinsey report, several other surveys also attest to the fact that these categories of customers want a fantastic experience across all channels.

Based on this finding, it is crucial to note that consumers today will quickly subscribe in situations where there are advantages, such as better preference customization and fewer store visits associated with the experience. And this is typically what the custom box plan offers.

Influences churn rate reduction

You probably don't need an introduction to customer churn if you run a subscription business, it's definitely on your radar! If the paradox of choice or maximum value for money is ever a reason customers churn, merchants selling custom subscription boxes have the advantage of reducing churn.

Building a custom subscription box requires your customers to take a quiz that gives you an idea of their product preferences, and this affords you the opportunity to understand their needs. This understanding fosters loyalty between them and your brand, and such loyalty has a positive impact on churn in the long run.

Larger customer base

Consumers all over the world are thrilled by the ease and variety that custom box subscriptions offers. This has given subscriptions businesses the opportunity to introduce themselves to consumers outside of their immediate location.

First Insight’s recent survey on subscription boxes, which was featured in USA Today, showed that 25% of respondents (both men and women combined) are currently receiving a subscription box, and another 32% of respondents plan to subscribe in the next six months. This means an increase in the number of potential customers who visit eCommerce sites daily, some of whom may not be within the same geographical location as your business. This is why custom box subscription providers need to explore the market without seeing location as a barrier.

Building a more extensive customer base, however, requires proper logistics planning that can cater to the needs of your customers regardless of the distance. Be sure to put that in place first, so you can comfortably manage the demands that come with a wider reach, for instance sorting and shipping out orders.

Growth

It is no longer news that the subscription model has experienced mega growth over the last couple of years. However, in recent times there has been a decline in sales for top sites that have gained supremacy, giving room for smaller niche companies that offer specialized niched products to consumers. This indicates an unprecedented influx of a niche market that sells unbelievable categories of products like pet supplies, kids apparel, beauty products, and many others generating recurring revenue using the custom box subscription model.

Evolution

The custom box subscription market has a bright future for development and opportunity for more competitors from different industries. You are going to see new entrants into the space,” says Paul Chambers, co-founder of Subscription Trade Association.

We are expecting to see innovative brands and retailers make an entrance into various niche markets like fashion and lifestyle, automobile, and pet categories as customers' interests shift.

Niche products selling custom boxes have witnessed a significant increase in net profit, and it is an indication that startups looking to sell niche products can be profitable and even explode.

Summary

This might be an unpopular opinion but the subscription business model is not for businesses selling online alone. And that means whether you are selling online or offline, you too can leverage the custom box subscription model to scale your business. What is important is that you adopt a subscription management solution like Chargezen that supports you whether you are online or offline.

‍