Subscription Services: Thinking Inside The Box
The subscription box sector has been one of this decade’s big success stories. Even if you don’t shave with Dollar Shave Club razors, dress with Ipsy, geek out with Lootcrate or cook with HelloFresh or Blue Apron, you probably know someone who does.
While a lot of subscription box companies use sophisticated analytics and data science to tailor their offering, the root of the model’s appeal is psychological. Subscription firms sell what sounds like an oxymoron: the guaranteed surprise.
It’s what we call Fluent Innovation – “80% familiar, 20% new”. You want the hit of surprise, but you need to trust that the box knows what you like, so that surprise will resolve into trusted and comfortable happiness.
Surprise is the selling point. Happiness is what keeps people around. And this blend of emotion is what makes innovation work.
But what happens when you lift the lid of the subscription box sector? You find low retention rates, and a brutal fight for customer acquisition.
That’s why recipe box subscription leader Blue Apron’s recent move to selling meal kits on retail shelves has been so interesting. Is Blue Apron’s move a retreat, or a logical step for subscription services?
To us, it feels like an innovator looking to become even more fluent: couching the surprise of the meal kit in the familiarity of the retail environment.
Blue Apron is also leveling up its long-term brand-building. In a world of quick, instinctive decisions, brands need three things to make themselves more choosable – Fame, Feeling and Fluency.
Building Fame is a question of building availability – creating wider reach and a presence on grocery store shelves will certainly help, as well as making the brand more Fluent (recognisable) and normalising the idea of meal preparation kits.
As for Feeling, Blue Apron has mostly relied on its customer service and the quality of its meals. But the right communication can nudge a brand along. Its recent series of ads, made by Droga5, focused on the emotional needs cooking fulfils. It included this ad featuring a working mom and her son, which scored 5-Stars in our self-funded tests.
With discreet branding, it’s a great balance between the sensory pleasure of food and the emotional truth behind learning to cook.