Are you planning on starting a Shopify subscription box business? Well, you’ve come to the right place. In this article, we will guide you with everything you need to know regarding the Shopify subscription box business, and most importantly how you can set up an efficient subscription box business of your own.

What is a Subscription Box Business?

A subscription box business is an e-commerce business that’s adopted the subscription model to offer its customers a personalized, low-cost way of receiving products on a regular recurring basis.

With this business type, customers make fixed recurring payments to keep receiving products on a regular basis making the revenue that is generated by the business more predictable and reliable.

The two most popular industries that have profited from adopting the subscription box model are the consumables and beauty industries.

Benefits of the Shopify subscription box business

There are multiple benefits to the Shopify subscription box business model. We’ve gone into details on some of these below:

1. Predictable revenue In a subscription business, the business itself is very aware of the revenue that they will be receiving every month from their customers. This is because customers tend to pay the same amount each month to receive their product, and as long as they remain happy with the product and the service being offered to them, they’re unlikely to stop their payments.

This helps businesses streamline other aspects of the business operations such as forecasting the sales, planning inventory accordingly and understanding the amount of reinvestment needed for further growth of their Shopify subscription box business.

2. Less customer acquisition cost Businesses with a pay-per-product pricing model need to spend a lot more on acquiring regular customer. This is because once a customer has made one purchase, they leave and the business needs to run promotions, marketing campaigns or newsletters to get them to return.

The Shopify subscription box model would save them from having to get customers to make additional purchases, as the customer is signed up to automatically pay for and receive products on a regular basis.

3. Customer loyalty When customers buy products from you, again and again, you can get a better insight into their spending and consumption habits, which in turn allows you to offer a personalized experience you know your customers will respond well to.

This will make customers loyal to your service and will ensure that they come back to purchase additional products or services from you in the future. It is only these loyal customers that make up most of the business revenue.

The lifetime value of customers when using the Shopify subscription box is increased which plays a great role in the success of the business.

4. Peace of mind Shopify subscription box businesses take full payment upfront before starting the subscription service, sometimes even at a discounted price. This reduces the risk of a customer using the service without paying for it, and gives peace of mind to the businesses, especially startups.

5. Better up-selling and cross-selling opportunities When you’ve built up the loyalty and lifetime value of your customers, you can generate more revenue from them by offering them additional products or services.

Because they already purchase other products and services from you, they’ll trust the quality of anything new you introduce and therefore be more likely to purchase it. This can help you roll out new products or services in the market with confidence.

Types of subscription box business model

There are three different types of subscription box business models, the curation business model, the replenishment business model, and the access business model. We discuss these in more details below:

1. Curation business model

This is the most popular subscription box business model, and is used widely in industries such as apparel, beauty, and food industries.

The curation business model allows companies to impress and acquire customers by offering them personalized experiences and products. This subscription box model comes with higher levels of profit potential compared to other models; however, the customer churn rate can also be high.

It also tends to be more expensive as it requires a more personalized approach to e-commerce. Some popular examples of curated subscription box products include coffee, pet food, skincare, toothpaste, books, organic food, etc.

2. Replenishment business model

This business model is the most beneficial for businesses that want to save costs and make money from customer convenience. It allows customers to automatically renew their purchases with discounts and offers for their repeat custom.

There is a lot of competition however with this model, as it’s easier for new companies to enter the market offering the same product or service at a discounted price, or as part of a more attractive package.

3. Access business model This business model is for businesses who want to provide special perks to the customers who have subscribed. With this model, subscribers pay a fee to access products or services at a lower price to customers who have not subscribed.

This business model is beneficial for a company that can offer discounted pricing, but also want to benefit from predictable recurring revenue to offset seasonal peaks and troughs. It can also help businesses built exclusive relationships with their customers, but it does require a higher level of investment to acquire and retain these customers.

How to start a Shopify subscription box business?

Do you want to start a Shopify subscription box business but are unsure of the process involved? Read the following steps to fully understand what is needed to start a Shopify subscription box business.

1. Identify what you want to sell

The first step involved in creating a Shopify subscription box business is deciding on the type of subscription box you want to sell. This includes choosing the right subscription box model -

a. Replenishment Subscriptions

b. Curation subscriptions

c. Access subscriptions

2. Identify Your Niche-

You need to identify the niche or individually of your organization in terms of the products and services provided by it before starting your subscription box with Shopify. You should also identify the brand personality you want to portray based on the target audience you want to attract.

While examples of niches are stationary, beauty products, food items, etc, brand personality depends upon whether your business is B2B, B2C, C2C, etc. Identifying the brand personality and the niche helps you create an effective marketing strategy and set up a homepage and a Shopify store that matches your brand personality.

3. Create your store with Shopify

If you do not have a traditional e-commerce shop already, you’ll need to create one from scratch to introduce your Shopify subscription box. To do this, you need to follow the steps mentioned below-

a. Purchase a domain The first step is purchasing a domain. You can buy domains from websites such as GoDaddy, Bluehost, Google domains, etc.

b. Sign up for Shopify After purchasing the domain you need to sign up for Shopify and connect your domain with it. You can either buy a paid plan or get a free trial first. After that, you can set up your domain by clicking on the online store tab which is present on the left side of the page.

c. Select a theme when you start customizing your Shopify store, the first thing to do is choose a theme. You can either choose from the default theme section given by Shopify or get a theme of your own with the help of integrations and plugins.

d. Customize the homepage After that, you can go back to the homepage and customize it by adding the information related to your brand such as the brand name, logo, and the required information along with images.

Next, you can start creating the product pages and then partner your Shopify store with the subscription box management and the app you are using for recurring billing.

4. Adding subscription and recurring billing to the Shopify store

To start selling Shopify subscription boxes in your e-commerce store, you need to integrate with a Shopify subscription box app. For this, you can either choose a subscription app or integrate it with a subscription billing tool with an API you can use. Some of the best apps that can be used for this integration include Bold, Recharge, PayWhirl, etc.

5. Set up your product catalog

After integrating with the subscription management app or API, you can see the subscription details of the products in the product pages, which can be found in your Shopify administrative portal. These details are visible in the subscription section.

You can choose to either only support subscription purchases, or to support both subscriptions and one-time purchases.

6. Connect the subscription store to a payment gateway

A payment gateway is an important element of any Shopify subscription box-based business. Also, the tool that you use for subscription management should be compatible with the payment gateway to provide a smooth experience for your customers.

Shopify comes with its own payment gateway known as Shopify payments. You can either integrate with this or choose from a third-party payment provider such as PayPal, Amazon pay, Billsby, etc.

7. Set rules for your subscription business

After making your subscription box functional, you need to add a set of rules to customize your product and service offerings. These rules include information about the products you want to be available for subscription, the frequency of billing for the customers, and other details related to shipping or discounts.

Tips to running an efficient subscription box business using Shopify

The Shopify subscription box market is stifling with heavy competition. Therefore, it’s essential for you to create a highly efficient and competitive subscription box. Below, we’ve listed some tips that you can use to take your Shopify subscription box to the next level.

1. Having an amazing marketing plan

Your marketing plan plays a vital role for your Shopify subscription box business. You should build a social community that is loyal and reach out to the subscription box bloggers to affiliate with them. The most important part of the marketing strategy is SEO optimization, and you should ensure that you follow the best SEO practices to be seen in the searches.

2. Creating a great product page

Your product page should be appealing enough to lure the customer into buying your product or service. To ensure that your product page is good enough.

you should make sure you have a design that is compatible with both desktops and mobile phones, as well as displaying captivating images of your product or service that’s optimized for both platforms. The call to action should be clear and visible. You can also add demo videos to make the product more lucrative.

3. Enhance the subscription experience of your store

You should provide an enjoyable checkout experience for any customers wanting to take out your Shopify subscription box. If your checkout experience isn’t intuitive enough, or is too long, this can cause customers to become disinterested and abandon the checkout process altogether.

4. Offer multiple options for payment

Many customers abandon products in their cart if their preferred payment option is not available. When starting your Shopify subscription box business and choosing your payment gateway, you should always consider what payment options your customers want, not just what is easiest for you to integrate with.

5. Reduce customer churn and enhance retention rates

You should use practices to reduce the rate of customer churn and enhance retention. Any subscription model is only ever successful as long as customers stay subscribed to the product or service.

So, what are you waiting for? Take your offline business or your e-commerce store to the next level by indulging in these practices and creating your own Shopify subscription box. Create a dynamic e-commerce store to lure the maximum number of customers and retain them with the tips mentioned above. Experience whopping growth in your business first and thank us later!