STORES Magazine - July 2015 - 39
thinking through relevancy of messaging and
product offering, and how your value proposition has to speak to consumers in a more personal way when you're operating in a digital
environment," Randall says. "There's the expectation among consumers, especially among
Millennials, that marketers and brands should
be able to do that.
"When you look at subscription services,
they're doing two key things: They're creating
a perception - or, in a lot of cases, a reality
- that what they're sending to you is aligned
to your personal tastes. The consumer is getting the feeling of one-to-one marketing, but
it's actually going even further: It's one-to-one
products and services, not just communication," he says.
Subscription-based sellers are "creating an
aura around engagement by capturing your
preferences, capturing your feedback ... . The
consumer feels like they've really got an expert
working with them on a one-to-one basis,"
Randall says. "That's critical. There's technology on the back end that enables it, but it's
really the strategy and front-facing customer
relationship platform that is the key to doing
this in a meaningful way."
ways retailers meet individual customer needs.
The expansion has gone both ways, with
companies that once focused primarily on subscriptions adding bricks-and-mortar, as well as
more traditional retailers adding subscriptions
to the mix.
"Each successful brand is going to have a
subset of customers that wants to engage at
this level," Randall says. "Especially those
brands that are tied to emotional activities or
ideology. They're going to have consumers
that want that deeper relationship and want
Offering a subscription as an additional
service can impact retention and satisfaction,
creating a consumer who will be a great brand
"The consumer feels like they're part of a
club, they're part of something special, and
they want to share it," he says. "The most
powerful value proposition to the consumer
is likely a combination of retail channels. I
see business models that are able to use both,
whether it be traditional retail or traditional
e-commerce, and subscription service. It's
not going to be relevant for all brands or all
retailers or all types of products. But for those
where this model makes sense, I believe it's a
bit of a virtuous circle."
In the case of a traditional apparel retailer,
imagine an arrangement in which a loyal customer automatically receives a delivery, every
three months, of the latest items in the right
size and style.
"That's a great value proposition for some
consumers," Randall says. "Consumers don't
and sell to help
- Deena Bahri, Birchbox
RIGHT PLACE, RIGHT TIME
Part of that relationship has to be about
the way products are delivered. Rather than
relying solely on subscription sales, today's services are more likely to be just one of several
STORES July 2015 39