The subscription box addiction is real! I admittedly have way too many subscriptions to even count these days. It’s fun to get a surprise in the mail, and open up a box full of curated goodies picked out just for me. Subscription boxes offer a lot of value because they offer a mix of highly personalized products, that keeps customers coming back for more.
If you’re thinking about starting a subscription box company, we’ll teach you everything you need to know about the process.
We’ll cover how to start a subscription box business in 7 easy steps on your Shopify store.
1) Brainstorm subscription box ideas
2) Create a Prototype
3) Pricing your subscription box
4) Marketing your subscription box
5) Create a website using Shopify
6) Pick your Products!
7) Launch your subscription box!
8) Keep and grow subscribers
The first step is figuring out what type of subscription box you’re going to create and sell. Jot down some ideas that interest you and put a star next to your top three choices.
🔥 Pick a Niche
If you’re having trouble coming up with ideas, think of subscription boxes for a niche community. A niche is a specific market. If there is a small group of people interested in a topic, chances are you can make a subscription box around this. Think of niche communities such as: organic skincare, knitting, vegan snacks, Eco-friendly home decor.
💡Know your Competition
It’s important to see what other companies are doing in the same space so you can make sure to be different or 10x better.
Subscription boxes are highly competitive but that doesn’t mean you can’t be wildly successful. On Google, try searching for keywords for the type of subscription box you want to create and see what companies are ranking on the first page.
You’ll want to see how many competitors you have in this niche, what their pricing plans look like, and what type of products they are including in their box.
✅ PROTIP: One way to stand out is by offering more value in your subscription box, perhaps more sample products or little freebies to surprise customers.
create a prototype box
Step 2: Create a Prototype
A subscription box prototype is an example box you can show customers to help them understand what they can expect when they order.
Create a Sample Box
Think of a prototype as a teaser or sample of your actual subscription box. It’s not the final product, but a mock up of what it will look and feel like.
With a prototype, you don’t have to know exactly what products you will use. This gives you flexibility to figure out product sourcing later right before you launch.
Don’t over promise
The idea of a prototype is that it is very similar to the subscription box your customer will receive. The prototype gives them a “taste” of what they will get in real life. It’s important to not over promise and under deliver.
You want customers get a good idea of what they can expect and then to be satisfied with the actual subscription box.
For example, The Witches Moon displays a sample subscription box on their site, showing items whihc might be included such as candles, crystals, herbs, essential oils and incense.
Picking a Box
In order to have a prototype you’ll need to have a box. Choosing your box is an important step in your journey and should not be overlooked. Unboxing is a huge part of the experience, so you’ll want to take your time with this step.
Choosing a box can be intimidating when you think about ordering thousands of boxes and aren’t sure how many sales you’ll make. Below are some helpful tips for how to get started.
1.) Custom Box – The beauty of a custom printed box is you can create exactly what you envision. They tend to lean on the more expensive side and can take time to produce (you may need to hire someone to create your box design). It can be hard to start right away with ordering a custom box because you might not have “proof of concept” yet. Lots of companies offer custom printed boxes without a minimum order such as: Packola, Next Day Flyers, and UPrinting.
3.) Regular Box – You can use any regular cardboard box you find at a craft store, and use it for our prototype while you shop around for a box. This helps you launch your product as quickly as possible without getting bogged down by the “pick a box” process. It also helps you save your cash on hand so you can develop your prototype first and test out the marketplace.
✅ PRO TIP: When picking out your box, you’ll need to pay attention to the size and weight of the materials. The box size will determine how much it costs to ship.
Step 3: Pricing your subscription box
Now that you have a prototype, you can start figuring out your pricing. Your subscription box needs to make a profit so you can stay in business. There are a couple factors to consider when deciding on a price for your subscription box.
The first factor is the product cost. In a nutshell, how much does it cost you to make your subscription box? You’ll need to consider the cost of the packaging (the box itself), sourcing products inside the box, and shipping.
Most subscription boxes have the cost of shipping included in the price already. You’ll need to calculate shipping and add it to the cost of making the box.
✅ PROTIP: After calculating the cost of the box (including delivery fees), you’ll want to charge a price that’s 40% higher than the cost of the goods.
Some pitfalls to watch out for:
1.) Don’t just copy competitor pricing
2.) Don’t under price your subscription box and end up with thin margins or no profit at all
3.) Don’t price your box so high it turns away customers
Subscription box entrepreneur, Jameson Morris says “The number one reason I’ve seen subscription box businesses fail is because they didn’t take the time to map out their COGS (Cost of Goods Sold) and build in enough profit margin.”
Step 4: Marketing your subscription box
It’s never too early to tell people about your business. Actually the earlier you start generating buzz, the sooner you’ll know if you’ve created something people are interested in.
It doesn’t matter if you don’t have a subscription box or website finalized, you can still market your company.
Come up with a name for your comany and then start grabbing all your social media handles.
For example, if my company was “AmyJoe Skincare” I would get all handles @AmyJoeSkinCare on Facebook, Instagram, Twitter, Youtube, SnapChat, and TikTok.
Pre-launch your subscription box
You can stir up excitement on Instagram by posting stories about pre-launch, grab emails, conduct polls, and announce giveaways. You can also start blogging about your business and promoting your articles on Reddit or Facebook groups related to your niche.
Your job is to create awareness about your brand, and then turn that interest into a paying customer.
You can also explore with paid advertisements that go to a simple landing page (more on that in the next section!) A good rule of thumb is to not spend more than $500-1000 on ads before launch.
✅ PROTIP: Pick one main social media platform (that you’re good at!) to dedicate most of your marketing efforts to.
Step 5: Create a website using Shopify
Shopify is the best platform to start and build your subscriptions business, period. Run your entire subscription business and customer experience from one place, from purchases to fulfillment.
How to create an online store
Shopify gives you the tools you need to create an online store where you can accept orders, drive sales, and manage customers. You can use Shopify to sell products to anyone, anywhere.
Anyone can sign up for a free 14 day trial on Shopify and build their store within minutes
Shopify is trusted by over 1,000,000 businesses in 175 countries around the world and has made over $200 billion in sales.
Best Shopify subscription app to use?
The best subscription app for Shopify is Ongoing
They automatically integrate with your theme and lets you create subscription products on your store with one click. It also takes care of recurring billing and payments so don’t have to.
Ongoing offers a customer portal where subscribers can manage their orders and track packages.
Step 6: Pick your Products!
The next step is you’ll need to figure out what specific products to put inside your box.
When searching for a product supplier, it’s important to make sure they are a reliable company that you can depend on. There’s nothing worse than not having a product you promised your customers or running short on items in your box at that last minute.
Finding subscription box product suppliers
One easy way to vet your suppliers, is to look at the products your competitors are using in their subscription box. You can contact these brands and let them know you are a new company starting out and see if they will offer you discounted wholesale pricing.
The next important thing to focus is on is cost. How much will each product cost to include in your box? Typically, the higher amount of products you buy from a supplier, the cost lowers.
We recommend contacting at least 3-5 different companies per product so you can compare costs. You can negotiate the cost down by telling them you’ll need a bulk order for a subscription box. You can also entice suppliers to lower to their costs by explaining your marketing plan and how it will deliver exposure to their brand.
✅ PRO TIP: Once you’ve become more established, you can ask brands to give you free product samples to include in your box which can save you money.
Step 7: Launch your subscription box!
Now you’re ready to launch your subscription business!
You can now officially start taking orders on your website, and shipping out subscription boxes.
The best advice we can give you is to plan out your fulfillment process before you even start thinking about mailing out your first box.
The number one customer service question subscription box companies receive the most frequently is “where is my box?”
Your customers are going to want to know exactly when their subscription box will arrive, so it’s your job to make this super clear.
Whether it’s on your product description, or in a customer order email, make sure you outline when the shipment date is so you can manage customer expectations.
Usually there is a billing period, and then the subscription box ships out, so just be clear with your timelines so customers don’t get upset.
✅ PROTIP: Try to streamline your process as much as possible, so you can prevent unnecessary headaches.
Step 8: Keep & grow Subscribers
Launching your business is just the beginning. Now it’s your chance to grow and scale up your store into a thriving business.
The end goal is to increase subscribers, but even more important is to keep your subscribers!
It’s much more costly to acquire customers, so it makes sense to focus on giving your current subscribers the best customer support and attention possible.
If you provide your customers with the best value, quality of products, and customer support, they will tell their family and friends about your company.
Nothing beats good ol’ fashioned word of mouth marketing, and it can have a huge impact on the growth of your company.
Naturally, over time you can gradually increase your subscribers which will grow your recurring revenue.
The bottom-line is focus on making your current customers happy so they can continue being repeat customers.
Best of all, use an app like Ongoing to help you manage your subscriptions and track your subscription sales. Having the right app on your side can make all the difference is helping you succeed and take your business to the next level.
I hope this guide has given you a lot of great tips for how to start a subscription box