Reviewing your monthly bank statement, you probably see your usual charges of Uber and late night fast food. For some, monthly subscriptions to companies like Netflix, Hulu, Rent the Runway or Dollar Shave Club also takes a chunk of your budget.
Consumers want the latest and greatest, which is why many of these companies are thriving in the retail industry. Each company has a strategy which benefits consumers and is profitable for them.
Alex Barseghian’s article “What’s Behind the Rise Of The Subscription Model?” explained how today’s consumer has no problem trying a startup, as the main priorities are price and convenience when purchasing a product. Barseghian also said that companies are benefitting from building a subscription service because it guarantees them revenue.
However, consumers have found many subscription disadvantages.
Moneycrashers listed how consumers overbuy, difficulty of cancelling the subscription, or unclear value in the box. Many consumers share their experiences with a range of subscription services below.
Being the third-most subscribers for its beauty products by Saurage Marketing Research, Ipsy offers monthly beauty boxes, samples, or full-sized products ranging from 10 dollars to 27 dollars per month.
“I do not want to spend the money on products I cannot choose instead of just buying one full size time,” senior Olivia Norman said. “It is similar to the Sephora check-out line mini samples. It is never a good deal but always tempting.”
“As a busy student juggling classes and internships, Hello Fresh delivers healthy ingredients and meals right to my door,” senior Brooke Sinek said. “The meals are delicious and most importantly, ready to make in 30 minutes. I don’t have to stress about wasting food since I can choose the portion size and how often I want meals delivered.”
The international meal delivery service is enjoyed by busy worker-bees like Sinek. Providing weekly delivery services, all the ingredients are included so the consumer follows the instructions for a decedent meal that averages between 11 dollars to 13 dollars per meal.
Co-founded by movie mogul Kate Hudson, Fabletics is a female workout clothing subscription service that offers spandex leggings and matching sets.
“VIP” offers include 2 for 24 dollar leggings or additional sale discounts. Fabletics allows the consumer to purchase clothing without being a “VIP” member, but the price doubles and less bundle deals.
The company has also expanded with brick and mortar shops for those who are hesitant to purchase online due to size or style.
“The quality of leggings was not great because they ripped and slid down even though that was their main principle,” SMU Sophomore Piper Kopser said. “But the advertising was really good, and the site had a cute quiz.”
Subscription based services started to boom with the help of Dollar Shave Club back in 2011.
The founders were frustrated with the cost of razor blades and turned this idea into billon dollar business. Always keeping the consumer in mind, an important element for this company is keeping costs low.
However, not every business works with this structure, and not every consumer is on board with the idea. Entrepreneur Kathryn Betts shares how her business Seams like Kate wouldn’t work as a subscription service due to time, demand, and need.
“A subscription service wouldn’t work because each piece is so individualized and each person has a want,” Betts said. “People do not want 10 embroidered shirts, maybe one or two. You can only have so many.”
Betts’ business operates only with her managing orders, payment and supplies which would be extra difficult if the business transformed into a subscription service.
As busy college students, sometimes that trip to Target is hard to fit into your schedule, so subscribing to a service may eliminate that issue. The struggle to find an outfit to your friend’s birthday might be easier to handle from the comfort of your bed.
We don’t know where the future of subscription based shopping will be, but, for now, many consumers are finding ways to simplify their life with subscription services from many of these companies.
