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Why subscription commerce is gaining traction

The subscription model has become a huge part of how ecommerce organizations do business.

Over recent years, subscription models have become increasingly important to both the software industry and ecommerce. Delivering boxes full of thoughtfully curated, high-quality products proved an effective strategy for growth in a wide variety of organizations, and new players continue to get involved. McKinsey & Company reported that each year from 2012 through 2017 brought more than 100 percent growth in the subscription ecommerce industry.

There are a number of benefits to centering a business around subscription boxes that make this approach to ecommerce effective. Whether a company specializes in clothes, beauty products, food or collectibles, a subscription model offers opportunities to attract customers and keep them for the long term. With the right strategies and partnerships, decision-makers can get the best outcomes from reliably delivering the items their subscribers want.

The advantages of a subscription model

"Businesses have to go beyond providing items that are in demand."

Forbes contributor Richard Kestenbaum suggested that the single biggest reason for the rapid expansion of subscription-based businesses was changing preferences in retail. With an unprecedented selection of products a few clicks away for ecommerce consumers, businesses have to go beyond providing items that are in demand and offer a true experience. Adding the elements of personalization and excitement that are possible with subscription boxes is a way to get the attention of potential customers and keep them coming back for more.

Delivering packages to people's doors on a regular basis makes buying items as simple as possible. A business that offers appealing boxes and delivers them on time builds a loyal base of subscribers who continue renewing their subscriptions and recommend a service to their friends and family. Companies have huge potential for growth as they continue to bring in new customers and expand on their offerings to target specific needs and interests.

The partnerships and technology to enable long-term growth

The selection of products is a crucial element in the success of a subscription-based business, but there's a lot more that goes into providing a consistently satisfying customer experience. Businesses need to be ready to manage online orders and inventory efficiently, securely processing payments and getting shipments out the door.

That's why it's important to have a powerful order management system that's optimized for handling the customized requirements of a subscription business. A relational database provides visibility into each transaction, so companies understand their customers' needs and maintain relationships over the months and years ahead.

Scaling up brings chances for greater profitability, but it also means severe strain on a company's capabilities for storing products and shipping them in a timely fashion. Enlisting a warehousing and fulfillment partner allows a business to continue meeting high demand while keeping costs under control. With all the necessary facilities and personnel in place and the savings that come from established relationships with major shippers, an organization has the flexibility it needs to keep growing.

As companies explore the possibilities offered by the burgeoning market for subscription boxes, they need a partner like SFG. The technology and resources to bring customers exceptional results puts an ecommerce company in a position to make the most of this business model's exploding popularity.

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