Here’s a thing you must already know about humans: we love snacks.
And if everyone loves snacks, that’s a gigantic market to tap into!
Additionally, Girl Dinner is all the rage right now. That’s just a bunch of snacks on a plate together that we then call dinner. With a trendy snack and a healthy marketing plan, starting a subscription box snack company sounds like a no-brainer! While we’re focusing on snacks in this article, remember that the subscription box model is super adaptable (and very successful!).
Plenty of businesses have seen success in the pets, beauty, and skincare industries, and the subscription box economy overall is expected to rise to $1.5 trillion by 2025. It’s never been more fun to get into the subscription box space! In this article, we’ll review why you might want to start a subscription box company, how to build it out, how to attract customers, and how to keep them engaged, happy, and coming back for more! So grab a snacky and let’s get into it!
You may have noticed that subscription boxes are everywhere. And just why are they so popular? One of the main reasons is convenience: you can sign up for a subscription box, maybe even forget that you did so, and receive something cool in the mail at some later date! It’s a great way to appreciate your former self with the convenient home delivery of something you are interested in. Additionally, it makes it easy to try new products in the niche you love. For example, do you love all of the interesting snack varieties they have in Japan? Tokyo Treat might be your jam.
Customers also love the cost-savings associated with subscription boxes. For example, FabFitFun declares you can save up to 70% off the retail price of the products in the box (full-sized products, too!). No matter how much expendable income you have, everyone loves a deal.
Subscription boxes most often feature surprise items, which can bring some excitement to an otherwise humdrum existence. When a customer is introduced to a brand new item, they might be intrigued to buy that product again, especially when it’s a tasty snack they wouldn’t have come across otherwise.
Besides the reasons they’re popular with customers above, subscription box companies make it easy for DTC brands to introduce their products to new markets or customers. If you’re passionate about food, innovation, and offering people unique experiences, it might be a great venture for you.
Some of the reasons why building a brand new subscription snack box company in the face of many competitors are:
It’s trendy: First of all, everyone loves snacks. Second of all, there’s endless opportunities to carve out your niche with specific snack categories, such as: artisanal, luxury items, vegan, gluten-free, or international snacks. By catering to specific audiences with a dialed-in niche, you’ll build a loyal customer base of snackish peeps who think of you first when they have a craving.
Consistent revenue: The best part of a subscription business is that the revenue stream keeps flowing. When a customer signs up, they are committing to paying on a monthly, quarterly, or yearly basis, so you know exactly how much money is going to hit your bank account, and when. Compare that to a regular DTC business, and there are no guarantees when the sales will (or will not) show up.
Personalized experiences: As your subscriber base grows, you will discover more details about your customers that you can use to create more personalized experiences based on their preferences. With the direct communication you have with your customers, it’s much easier to get feedback, test new products, and build the community around your brand. Consider setting up loyalty programs to reward your customers for being a subscriber, as well as a referral program so your fans get to refer new friends!
Flexible Business Model: Subscription programs allow you to start small and build your program up as the business grows. For example, CrateJoy has a marketplace where you can list your subscription opportunity to reach 4 million potential monthly viewers. Some boxes are a great idea, and just need to reach the right audience!
This just touches on a few of the reasons why building a subscription company might be a great business venture, but it’s essential to conduct thorough market research to understand your target audience, existing competition, and business logistics before diving in.
What kind of snacks are you going to focus on? Will they be vegan, gluten-free, all-natural? Maybe you’ll go the complete opposite direction and make a subscription box that’s just a bunch of different flavors of gummy bears. Whichever direction you choose to go, make sure you have done the research on your target market and competition. There’s definitely a bunch of candy-centered subscription boxes already, but maybe keeping it just to gummy bears means you’re hitting that specific niche of customers who only like bears (this is just an example, please don’t take it as advice to go all-in on gummy bears… but maybe?).
Where do you find the products for your specific subscription box? If I were actually building my Gummy Bear Subscription Box, I’d probably start with the most popular suppliers, like Haribo. When working with an existing brand to distribute their product, you’ll have to enter into a wholesale/retail agreement so you are following local regulations and resale requirements. It should go without saying, but you need permission to resell another business’s products, so make sure you get that! Try to negotiate wholesale pricing so you don’t have to mark your product up too much to make a profit on the sale of your box. Consider some international options if you want to add something unique to the mix (apparently, the gummy bears Haribo manufactures in Germany are chewier than the ones made for the US market).
It’s important to understand how much it will cost to ship your specific box to customers in different markets. You’ll need to do the appropriate research depending on your geographic location to ensure your chosen shipping material and carrier is the most economical and fast option available. Nobody wants to be waiting forever on snacks! It’s also imperative you understand the upfront costs required to create custom branding, packaging, and shipping costs so that when you are pricing your box, you’re actually making a profit.
How frequently do people need (or want) to receive your subscription box? When it comes to something like candy, it’s probably something that could arrive monthly, since candy often disappears quickly once opened, and a few repeats of certain gummy types wouldn’t really disappoint anyone. However, if your product is more of a pantry staple (like dry noodles or spices), then maybe a quarterly subscription would be more successful. Once you determine how frequently the box will be shipped, decide which payment options you’re offering to customers. Will they pay monthly, or is an annual subscription offered at a better deal?
It may sound daunting, but plenty of tools exist that help you build a beautiful, functional website very quickly. One such option is Shopify, where you can create a website for your subscription business in a matter of hours. There are also amazing tools built specifically for subscription businesses, like Recharge, which helps merchants set up and manage dynamic recurring billing for their customers.
Shopify’s blog has a great article about how to start a subscription company that’s worth a read.
Go out and find your ideal customers! As mentioned previously, you can advertise your subscription box on a marketplace like CrateJoy, or employ the traditional marketing options like Google Ads, Facebook, Instagram, and TikTok to find your customers, depending where your target customer spends the most time. As you gain more visitors to your site, it’s important to evaluate your analytics with a critical lens to understand which of your marketing attempts are successful. That’s where Triple Whale comes in!
Once you source your product, build your box, then figure out how you’re going to price and ship it, you’ve got to find your buyers! So how do you entice those snacky folks to jump on board?
Social media: It’s become the biggest place to advertise to potential customers in the past (nearly) 20 years, ever since Facebook figured out how much money it could make from advertising. While the algorithms keep changing, there’s still an easy and low-cost way to engage with potential customers through platforms like Facebook, Instagram, and TikTok. Visual-centered platforms like Instagram are fantastic for stylized photos and Reels to showcase your snack box, and TikTok is a great place to go viral with a quirky dance to bring attention to your brand.
Influencers: Promoting brands is literally a full-time job for some online personalities, so finding a way to collaborate with influencers that are successful in your specific niche (food/lifestyle), can get a lot of eyes on your product. You can also create customized links or discount codes for influencers to promote so you can easily track which influencers are driving sales (made especially easy to visualize in Triple Whale’s Affluencer Hub).
Advertising: Make sure your budget includes some money to be spent on advertising, especially online ads through Google or Facebook/Instagram. As mentioned above, there’s extreme competition in the snack box niche, so you’ll want to have a promotional campaign surrounding awareness when you’re first getting your name out there!
Referral program: Advertising is one thing, but a word-of-mouth referral still means a lot in retail sales. By creating a referral program where your loyal customers are rewarded for getting their friends/network to subscribe, you’re creating a win-win situation!
Launching a subscription company isn’t for the faint-of-heart. It’s hard work, but if you’re creating a subscription box company for a product you truly believe in, you’re going to be bringing something new and exciting to the market! By combining a love for snacks with a scalable business model, you’re creating an opportunity to serve a loyal group of subscribers that share your passion for snacking. Take these tips for how to build a subscription snack box company and build out something new, interesting, and most importantly: sweet (or savory… if that’s your angle. We like both).
Supercharge your growth with a purpose-built ecomOS for brands and agencies.