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Battle of the boxes
SHOPPING might be a national pastime, but tell that to the few among us who think retail is anything but therapy and clicking through pages of products on an online store is a major chore. For these folk, say hello to subscription services that deliver essentials - and more - on a regular basis.
With the timely delivery of daily must-haves in your subscription box, you will never again allow an ice-cream craving to go unsatiated, Google 24-hour mini-marts near your home when you've run out of feminine supplies in the middle of the night, or have to sport a stubble just because your razor has gone blunt.
A fast-growing segment in e-commerce, the subscription box craze first started here as early as 2011, when a slew of businesses mailed out boxes of beauty samples on a monthly basis. Dominated by players such as Bellabox and Vanitytrove, such businesses have since shut down or tweaked its model as it lost its novelty, or faced increased competition from similar companies. Bellabox, which hails from Australia, ended its subscription box service last year; while the founders of Vanitytrove has evolved the business into a new app for finding and booking beauty services called Vanitee.
"Beauty box businesses in South-east Asia rely heavily on the beauty brands to supply us with samples," says Douglas Gan, founder of Vanitytrove and Vanitee, who has raised a S$5 million seed round for the latter.
"Even though we have been very lucky to have been received investments by (Singapore cosmetics and fragrance distributor) Luxasia, imagine how difficult it is to convince a beauty brand to give you thousands of free samples to make your business profitable."
Box of surprises
Priced from S$15 to over S$30 a month, most subscription services often revolve around necessities that need to be replenished regularly. Blissybox (www.blissybox.sg), for example, specialises in boxes for that time of the month. Following the trend of period subscription boxes that has taken off about two years ago in the US, Blissybox offers a wide range of feminine hygiene products from familiar brands such as Kotex, Whisper and Tampax to organic tampons and pads by Natracare. While there appears to be up to a 50 per cent premium in cost for some orders as compared to shopping for supplies the old-school way - from the supermarket or drugstore, Blissybox includes other surprises in each box such as sachets of Woman's Moon Cycle Tea by Oregon-based tea company Yogi, that relieve minor menstrual tension with ingredients such as American Sinesis (tangkwei); Ferrero Rocher chocolates and beauty product samples and accessories.
"Although anyone can start a subscription business, you must have a product that people desire or are in need of on a monthly basis," says Anna Karlsson, founder of Blissybox. "What sets Blissybox apart is that we are the only subscription box in Asia providing feminine hygiene products - something that all menstruating women are in need of every month. It's not as glamorous as some other subscription services, but it serves an already (naturally) established need."
And while women have their "lady boxes", men can also get their monthly fix through a "shave club". Triggered by the success of mail-order razor business Dollar Shave Club, the US company that is valued at US$615 million but is reportedly not profitable as yet, a number of subscription services dispensing razor blade replacements every month have also cropped up here.
Shave It Club (www.shaveitclub.com) is the latest to jump on the bandwagon, offering four new cartridges, each made from five titanium-coated stainless steel blades and an aloe vera base for lubrication, every month for S$15.90 - compared to about S$27 for a similar-sized pack from an established razor brand. Members of the club also enjoy discounts with other retailers such as motorbike stores, lifestyle boutiques and cafes.
"What we propose and market is convenience," says Shave It Club founder Mubarak Shah. "It is an affordable service, half the price of other brands of equal quality and yet you never need to enter a store again to buy them."
Apart from humdrum essentials, boxes also appeal to our innate curiosity. From craft kits for kids to raw ingredients for your own gourmet meal and even premium teas delivered to your doorstep every month, it seems the novelty factor of receiving something unexpected is perhaps the main driving force of the consumer craze for monthly boxes. After all, who doesn't love feeling like it's her birthday every month of the year?
Created for the trendsetting female shopper, fashion box service Lowinsky (www.lowinsky.com) aims to customise a selection of apparel and accessories for its subscribers every month through its in-house team of buyers, stylists and proprietary algorithms.
The company first started in Singapore because it is relatively affordable to deliver boxes to such a small market. It has plans now to expand to Hong Kong in upcoming months to increase its subscription base. Based on a customer's preferences, lifestyle and even socio-economic background, Lowinsky would curate several fashion pieces that will go into each box that they think suit a shopper's style.
"Frankly, in Singapore, if you want to buy clothes, you can just hop on down to Robinsons or Isetan and shop," says Michael Goh, chief marketing officer of the two-year-old company. "But it's the personalisation factor that we offer that introduces to customers things they didn't even think they would wear. This is how we have customers who have stayed with us since we've launched." However, the element of surprise could also be the downfall for some services when the novelty factor wears thin. How many pairs of socks or samples of beauty products that might potentially cause a reaction does one need, really? "Receiving too many products from different brands means the customer may get things they don't like, which leads to disappointment," says Natasha Chiam, founder of Singapore's first ice-cream subscription service Pint Society (www.pintsociety.rocks).
"Ours is different because people sign up for two pints of our own brand of ice cream every month. The flavours will vary, but our customers know exactly what they will receive so their expectations are always met."
Ms Chiam started with a traditional e-commerce platform, order.icecreamcookieco.com, that retails cakes and ice-cream sandwiches. After receiving regular requests from customers about where they could buy her products, she realised there was a demand for her unique desserts - think hand-toasted marshmallow ice cream within sugar cookies, and a strong enough customer base to kickstart a subscription service. And hers isn't the only food business to have a subscription box spin-off. Pint Society charges S$348 per annum.
Subscription for rare premium teas
After starting Infusion de Vie, a brand of 100 per cent organic teas based in Singapore, last year, founder Brian Chen received positive feedback from customers who appreciated that his teas do not contain additives such as infused flavours and sweeteners. Fans of his teas, which hail from Taiwan and are blended with fine traditional Chinese herbs, began asking for tea appreciation classes to sample more teas on a regular basis. "We decided to launch the subscription box service so that true tea lovers who have always wanted to taste rare premium teas and learn more from our tea masters, can do so in the comfort of their homes for just a nominal fee," says Mr Chen, who is based in Guangzhou, China.
"Subscription boxes can be a passing fad if the entire business is dependent on this model. However, for companies which already have a business with products in the market, using a subscription box is an additional channel to reach out to a larger customer base." Infusion de Vie charges S$149.90 for six months.
With turnkey platforms for subscription services such as Cratejoy readily available, it seems anyone with a few boxes and a storeroom of kooky products are ready to start their own box subscription brand. In fact, subscription box startups overseas include purveyor of monthly survival gear Battlbox, supplier of smoothie ingredients Smoothie in a Box, condom subscription Rubber Club, and Designer Box - a minimalist crate containing a designer object, newspaper and a surprise. The box once included a marble penholder by Singaporean designer Nathan Yong.
"However, most technology companies cannot rely on solutions like Cratejoy because you can't personalise it and tailor the customer experience, and keep up quickly enough with your customers' needs," clarifies Mr Goh, whose developers are working on a new set of algorithms to further simplify the selection of contents for their womenswear boxes.
Just like running any other retail business, the subscription box formula is anything but simple. In fact, Bellabox Asia terminated its subscription service here despite a A$12 million (S$12.08 million) valuation of its parent company in 2014; and US baby goods box creator Citrus Lane closed a year after being acquired for US$48.6 million. The inability to source for products to sustain multiple months of deliveries, low barriers to entry for competitors or failing to respond quickly enough to consumer demand might open up a Pandora's box of problems for newbie entrepreneurs.
"Most subscription boxes give things like samples from a mix of different brands. This means the company has to collate inventory from many sources which can be challenging," adds Ms Chiam. "We manufacture our own ice cream so we have more control over inventory than a company that has to rely on suppliers."
Being as vertically integrated as possible might mean a bigger investment at the get-go, but might be one additional step to achieving greater longevity. While Boxgreen was started simply enough - its founders found themselves bingeing on biscuits, chocolates and chips at work and realised there was a gap in the market for healthy snack delivery services for individuals and offices, the business ecosystem it has started is anything but.
"All our products are developed and packed under the Boxgreen brand where we cut through as many layers of middle-men as we can and embrace the direct-to-consumer model," says its founder Andrew Lim. "In doing so, we're constantly collecting data and feedback from our customers enabling us to understand their taste preferences and habits, tweaking our snacks and service experience to their needs."
And all that effort behind the scenes just means greater convenience for today's lazy consumers, who can now outsource retail decisions and shopping in return for more time to update their Facebook newsfeeds and send emojis to virtual friends.