The Psychology Behind Subscription Boxes

Don’t you just love it when you receive a package on your doorstep, not knowing what it contains? The anticipation of opening the package and discovering its contents alone is a whole experience in itself.

Now, what if you got a mystery package like that every month? Would you opt for such a plan? Retailers bank on this psychological effect to increase their sales, with the emotional connect that we feel while opening a package.

A subscription box is something that delivers new contents to you regularly, over a period of time. If you’re wondering why the obsession with subscription boxes has been rising, especially recently, it’s important to understand what it is and what the core psychology behind subscription boxes.

What are Subscription Boxes?

Subscription boxes are a recurring delivery of select products, according to a theme or a type of product, which are delivered to you over a scheduled period of time. They come in a variety of options that range from fashion to pets. They target a very vast audience and cater to specific interests.

Although subscription boxes are recurring, there is a difference between a single box and a scheduled subscription. The consumer may or may not choose to have a monthly or quarterly subscription of a product if they want to.

How Did Subscription Boxes Become So Popular?

According to Forbes, Birchbox started the trend of subscription boxes in the year 2010, by providing consumers with samples of personal care products. Since then, they have grown by at least 100% with every passing month. Retailers like BarkBox and NatureBox have also followed suit with a growth of 50-100% every month.

Now, subscription boxes exist for anything and everything a person could ever want. Personal care, food, pet-care, gaming—you name it!

There are 5.7 million subscription box shoppers in the U.S. alone! That is a lot of people who are addicted to subscription shopping!

55% of all subscriptions are curation-based, and 32% of the consumers have opted for a replenishment subscription, i.e. their subscription gets renewed at the end of the time period, and payments are made regularly to ensure continuously receiving subscription boxes.

Social media has also influenced the purchase of subscription boxes. Influencers on Instagram and YouTube with cult-following often post unboxing videos of their subscription boxes. This is also one of the many reasons why they are so popular today.

What Is Their Appeal?

The concept of subscription boxes appeals to us because they cater to very specific requirements. Retailers like Man Perfected, and Bondi Wash offer a variety of grooming products for men, and soap and cleaning products respectively. Other retailers like the Indian website The Big Book Box offer a monthly subscription to books based on a particular theme every month, along with other bookish merchandise such as bookmarks. This thematic curation is something that appeals to the consumers.

The prices for subscription boxes range from as low as $10 to somewhere around $500. So to speak, there is a subscription box that can cater specifically to your needs, without having you break the bank. This economic inclusiveness is very appealing to consumers.

A very important part of their appeal is that subscription boxes offer products that would generally cost, maybe double or triple the original value if bought from the market. Consumers find this very economic. Because, why would you get something for triple the price when it you can get it without spending too much, right?

Sometimes, subscription boxes also provide items that cannot otherwise be purchased in the market. This feeling of exclusiveness is also very appealing to a lot of consumers. Besides, the joy of owning something exclusive is a rush, isn’t it?

Retailers also include samples of the latest products from various brands in their subscription boxes so that consumers can test them risk-free, and make a purchase if they liked the product.

Basically, subscription boxes are pretty much the only way to gift yourselves something and still be surprised with the contents.

Psychology Behind The Success Of Subscription Boxes

From a psychological point of view, subscription boxes work on the principles of operant conditioning and behavioural consistency.

According to B.F Skinner’s theory of operant conditioning, positive or negative reinforcements can bring about changes in a person’s behaviour. Subscription boxes, in this case, are a positive reinforcement.

Another reason why people opt for regular delivery of subscription boxes can be explained through Dr. Charles Livingstone’s theory of reward uncertainty. It’s very simple- if you keep giving your consumers a predictable set of rewards, they quickly lose interest. Subscription boxes also work on the same principles.

After all, who wouldn’t want a continuous flow of rewards?

Applying the theory of behavioural consistency, consumers are more likely to sign up for ongoing subscriptions if they have already done so in the past. If the consumers are pleased with what they receive, they are even more likely to keep getting subscription boxes.

Another psychological trick that retailers use to gain compliance is the scarcity principle. Consumers are more likely to purchase a product if only limited pieces of it are available. They cleverly make use of the notion of the fear of missing out, (that we all now know as FOMO), into making their consumers opt for a subscription box regularly.

How Do Subscription Boxes Help Retailers?

What is the first thing that draws you to the idea of a subscription box? Is it the idea of having a box full of items that are specifically picked out for you?

Retailers often ask their consumers to fill out a form with particular details that allow them to know their consumers better. This is done under the guise of sending you a ‘tailor-made’ set of products that match your needs and interests.

The details that you provide to a retailer in order to get a customized subscription box are often valuable to several brands that provide the products. This information allows the retailers and brands to do an inventory and understand the needs of their consumers better.

What Is The Take-Away?

Subscription boxes are increasingly becoming the most popular way to buy products and services online. They are most popular with the age group 20-44 years old, and are very common among urbanites.

The dominance of a curation-based subscription is the result of consumers who want a continued series of personalized and high-quality experience. Everybody wants to receive items that have been curated specifically based on their interests.

28% of the consumers who have opted for a replenishment-subscription plan said that they continue to get their subscription box because it is convenient for them. 23% find the subscription boxes to be a good bargain for the money they pay.

Despite all of this, churn rates, or cancelling the subscription when a consumer isn’t satisfied with the products, has been high.

The subscription box market is growing fairly quickly. There is a lot of competition with over 600 retailers who offer subscription boxes. In such a state, companies in the space must develop better experiences as opposed to better subscription boxes. This will also help in bringing down the churn rates, as well as in accelerating growth and profits.

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