“TALK” ABOUT A BUSY HOLIDAY SHOPPING SEASON— V-COMMERCE JUST GETTING STARTED. ARE YOU READY?

Author: Joe Scartz

We are already anticipating the largest digital commerce holiday shopping season of all time this year. Digital Commerce is set to account for $123.73 million out of the roughly $1 trillion dollars that will spend this holiday season at retail, according to eMarketer.

Voice, while a fractional amount of that total currently, is accounted for in the digital commerce number. The question is…how big can voice commerce (v-commerce) grow in the years to come and what should brands and manufacturers do about it?

 

The Landscape Today

Today, voice commerce is benefitting from broad adoption of software and hardware platforms and tools that enable voice shopping. At VELOCITY., we divide this software and hardware into four primary categories: The voice assistant powering the experience (distributed through various devices), the pervasive smart phone, smart speakers, and IOT as a category.

The Voice Assistant

The four major AI players are Google Assistant, Alexa, Siri and Cortana. Nearly half of U.S. adults use voice assistants on their smartphones, but also through IOT, laptops, tablets, cars and various other devices. Siri is the most widely used due to the iPhone followed by Alexa, Google Assistant and then Cortana. However, Amazon and Google clearly lead in proliferation and usage of smart speakers (Echo and Google Home specifically).  More on that  in a moment..

The Smartphone

We all know that the smartphone has reached critical mass (particularly in developed countries). What is important for v-commerce is that AI and voice assistants are being embedded into the user experience on these phones more seamlessly. Siri integration was a major component of ios 12. Earlier in 2018, Google announced that 95% of Android phones will  be reached by Google Assistant. Clearly the two biggest players in the smartphone world want their assistant to be the center of your relationship with their hardware and software.

The Smart Speaker

It is anticipated that the Google Home and Amazon Echo (all variations) will be two of the hottest selling items this holiday season and throughout 2019. As of June, 2018 20% of U.S. households own a smart speaker and Deloitte expects 63% growth next year globally.

 

The Prospects for Growth

As we have seen, the technology and the platforms for continued growth in voice are established. So, what are the commerce opportunities for voice?

Some firms have predicted that voice will grow to $40 billion dollars in the U.S. and U.K. by 2022. This is significant, when you consider that those two countries are leading nations in adoption of voice globally. Therefore, brands need to be prepared. In a world where one or a firm search results on Amazon or Google, or even Siri could limit your brand exposure, optimizing for voice today; not tomorrow, is your best bet. Measure your voice readiness on a brand-by-brand and product-by-product basis now. The future of search and brand engagement via voice has arrived.

What We Expect to See From Amazon in 2018

At this point, its clear that Amazon has become more than just another e-commerce company that we all shop from. They are also a digital content provider, research destination and marketing channel. And, with their first brick and mortar opening to the public earlier this week, their bigger step into grocery last year and other recent innovations, everyone seems to be watching and wondering what’s next. Based on what we know and are seeing, here’s what we expect from Amazon in 2018: Sensor Replenishment, Voice and Camera-Enabled Machine Learning.

Continued Alexa Growth

Amazon Alexa is growing at a faster rate than any other voice platform. Today Alexa is used mostly for Setting timers, playing songs, reading the news, and shopping.  Shoppers that utilize Alexa purchase 30% more than Prime members that do not utilize alexa, and 70% more than non-Prime members. With this much potential growth, Amazon looks to be doubling down on voice. We expect to see continued aggressive discounting on the device to get the Amazon Echo into more homes and continued improvements and skills.

Amazon Dash Replenishment Program – More Automatic Reordering

Early 2018 Amazon announced that several manufacturers are producing smart products that integrate with Amazon to automatically reorder for consumables when supply runs low. 3M, Blustream, Epson, HP, and Kenmore are some of the key players in this program. It is expected that several more devices will follow suit.

Amazon’s Dash Replenishment leverages multiple sensors to analyze when a consumable is running low inducing a buy order to replenish the product before it runs out.  Printing paper, ink, laundry detergent, and coffee are some of the products that will be available through Amazon’s Dash Replenishment.

Machine Learning Video Camera

Amazon is capturing voice. So, what’s next? View. Amazon has technology that they are releasing to developers to utilize Machine Learning-enabled video cameras. We know Amazon is obsessed with tracking through sensors, and now they will continue to develop on their camera tracking. The next step from here is to follow a similar path to Alexa, where amazon will offer the technology to be included in the manufacturers’ end so they can continue to dominate auto-replenishment and more.

 

Written by: Rami Odeh, TPN VP, Digital Commerce

Amazon Go Is A Game Changer

We have seen time and time again that convenience is king. A frictionless shopping experience will allow many customers to get their grocery shopping done quickly, and efficiently. There is no need to wait in line to check out. No need to pay at the register. This is a long overdue break-through innovation that will give Amazon a competitive edge in the grocery space.

 

Not only does the promise of convenience drive a competitive advantage for Amazon in the grocery space, but through technology, Amazon is able to drive efficiencies and, in return, reduce cost of operations in running a grocery store.

 

Business Model Advantage

Amazon is going to have the ability to apply their customer-centric methodology to the grocery space by driving convenience and lowering costs to the consumer.

 

Amazon will save money with their Computer Vision, Algorithm, and sensor fusion technology. Through Amazon’s Computer Vision, a customer will be able to take what they want off of the shelf, and it will be added into their virtual shopping cart. If a customer decides they do not want a certain product, they only have to place the item back on the shelf in order to have it removed from their virtual basket so they do not get charged for the item. This will save Amazon employee costs because they will not need their stores loaded with people restocking all the items that people leave in random spots of the store before checkout.

 

Second, shrinkage due to theft will become a thing of the past. Billions of dollars a year are lost due to theft in the retail space. With Amazon’s technology, theft will be a thing of the past.  Allowing computer to manage the virtual cart eliminates human interaction, which, in this case, eliminates theft.

 

Third, checkout will be an unnecessary expense for Amazon since the checkout process will take place in the shopper’s pocket automatically on their mobile phone. This will also reduce the number of employees, which will result in lower overhead for Amazon Go.

 

Finally, and most importantly, is the Amazon shopping algorithm. Amazon knows more about its customers through shopping behavior than most people can imagine. Amazon has the ability to learn from its customers within a geographic location to ensure that the right type of inventory will actually be available for purchase. What does this mean?  This means that Amazon can expect to see revenues of a football-field sized Walmart with a physical brick and mortar footprint the size of your local convenience store!

 

All in all, this is huge and I am optimistic that this will put pressure on existing grocery chains to “step up their game” in technology and convenience in order to compete with Amazon in this space.

 

The good news for grocery consumers will be that we can all expect huge improvements across the board in multiple chain grocery stores and improved pricing as others shift to compete with Amazon Go.

Pinterest: What’s New?

TPN’s Digital Marketing and Commerce team keeps a constant eye on innovation to keep our agency and clients informed. In the latest installment, we dove into new functionalities of Pinterest and how these have helped the platform stay relevant. Watch the TECH DMC minute below.

TechDMC Report 28 August 2017 from TPN on Vimeo.

Big Changes in Ecomm

This morning, Walmart announced a $3.3 billion dollar deal to acquire Jet.com—the highest price ever paid for an eCommerce company. 

Jet.com has quickly become known for “Gamifying Shopping” with its pricing algorithm based on encouraging higher average order value baskets, while producing savings for their customers. However, currently less than 1/3rd of Jet.com’s orders are fulfilled from Jet.com’s warehouses. With Walmart and Jet.com teaming up, Walmart is able to leverage Jet.com’s pricing algorithm while Jet.com will leverage Walmart’s wide fulfillment network. 

With this deal, Walmart discussed its intention to keep Jet.com as its own entity, but it is needless to say that there is going to be plenty of opportunity for data sharing across both unique companies. Strategically, Walmart keeping Jet.com separate from Walmart.com gives Walmart the advantage of using Jet.com as its innovation center and pushing successes to Walmart.com. 

With this deal, Walmart is clearly positioning itself to give Amazon a run for its (well, your) money in the eComm space.

It’s All In The Delivery

The ways we eat meals continuously evolve as our lifestyles, social dynamics and workloads change. The frozen TV dinner changed the landscape of meals in the 1950s, streamlining meal prep with readily portioned trays that could be popped in the oven for easy weeknight meals. Tupperware enabled make-ahead meal prep possible, as well as proper storage of leftovers for reheating later. The mainstream introduction of the microwave in the 1980s, lead to more adaptations of ready-to-eat meals (and of course, the HotPocket).

Take out and delivery used to only be synonymous with pizza and Chinese food; fast food was burgers and fries (itself an evolution from street food vendors and bar food). Now we have apps that will coordinate pick up and delivery from just about any restaurant you could possibly want, at the touch of your finger tips; we gleefully hunt down specialty food trucks or trek down to the food truck lot, serving as our modern day, anywhere food court. Our busy schedules may not even lend themselves for meals, which has lead to a rise in snacking, a whole different conversation but one that I wanted to at least acknowledge.

So, while all this should beg the question Does anyone really cook anymore? Quite a contrary movement has taken place. Instead, there is appreciation for the home-cooked meal. The traditional route still involves grocery shopping for items needed for recipes, cooking the recipes at home; the routine is broken up by inspiration found on recipe sites, blogs, Pinterest and those droolworthy videos popping up in your feed that make all cooking look easy. According to Joe Scartz, TPN’s Managing Director of Digital Commerce and Integration, “Grocers have seen the trend move toward simple prepared meals now for years and they have tried to fight back with white label brands and grab and go meals.”

Retailers are also offering up opportunities to streamline the traditional process through omni-channel retailing of buy online, pick up in store: Walmart grocery is available in limited areas; CVS is testing CVS Express for a rollout later in 2016; Harris Teeter Express Lane has been around for awhile, also offering home delivery; Ahold’s Peapod is a online grocery service delivering orders and providing them for pickup; Amazon Prime Pantry is gaining speed as well, just to name a few. Inspiration becoming a final product precipitates social sharing of successes or pride in fails.

Meal delivery services, for those who can afford it, offer an alternate route with the modern convenience of having everything you need boxed up for you, ready to assemble/cook, so you can post it to your social media, aka humble brag “I made this.” What was once relegated to weight loss programs like Jenny Craig, these meal services now embolden people to be their own top chefs in the kitchen, with recipes that range from updated American traditions to ethnic fusions with unusual ingredients, previously found only in restaurants. The types of services available seem to only be limited by an entrepreneur’s imagination: local farm-to-table services, gluten-free services, food allergy services, high-end, unique services, etc.

A natural fit for its brand, Weight Watchers has partnered with meal service Chef’d to provide points-approved options that work well with their diet plan. Blue Apron has taken the lead of the services, with a somewhat customize-able recipe offering and subscriptions with meals for 2 and larger families as well; their price range is roughly $60 to $140 per week, depending on the number of meals delivered. Blue Apron also offers wine solutions as well, to partner with the meals. The convenience takes away all guess work and is winning with folks who alternatively, ate out or brought home meals on a regular basis.

We’re seeing how retailers are adapting to our ever changing foodie landscape, what can brands do to adapt? “Brands should be doing more to partner with the home delivery meal services if they want to attract this type of consumer. That being said, while consumers “barely” have to go to the store, 97ish% of all of grocery shopping is still done in-stores of various formats. It’s one of the slower ecommerce categories to catch on but that is changing, slowly,” says Scartz. To that point, “Brands need to worry less about the fresh food meal delivery service and need to worry more about being shut out of impulse purchase as grocery ecommerce does grow. For example, once a consumer creates a list for Amazon.com, they are apt to reorder the same products. Same goes for Instacart or Peapod or whatever. Brands need to market and merchandise on those platforms with an eye toward subscription, especially as omni-channel retailing becomes more the norm.”

Amazon and the Handmade Frontier

Today, Amazon launched a new marketplace called Handmade at Amazon, which takes competitor Etsy head on. This new arts-and-crafts bazaar hosts over 80,000 items from about 5,000 sellers in 60 countries, moves Amazon into new territory and positions it to take lead in the every growing, home-grown artisan market.

What’s in it for shoppers?

Amazon shoppers will already feel at home browsing around the 6 handmade categories—home, jewelry, artwork, stationery and party supplies, kitchen and dining, and baby—through a familiar interface and cart process. Each product’s detail page prominently displays the Handmade logo and features a picture of the artisan behind the work, with links for specific inquiries. So, they get to know the person a little more, and make a connection. While being able to request custom products, shoppers can also easily automate the made-to-order purchase process without directly contacting the seller through Amazon’s options.

Shoppers are also assured that these products are in fact, handmade (not just made to look handmade). Amazon has been vetting artisans since May for their marketplace, and has strict guidelines for what constitutes handmade:

All products available in your Handmade at Amazon store must be made entirely by hand, hand-altered, or hand assembled (not from a kit). Products must be handmade by you (the artisan), by one of your employees (if your company has 20 or fewer employees), or a member of your collective with less than 100 people. Mass-produced products or products handmade by a different artisan are not eligible to sell in Handmade.

While this may seem like a trivial distinction to make, it’s one that Etsy has skirted since changing it’s vendor rules, allowing for outside manufacturing. Etsy’s controversial decision has lead to an expansion of what vendors offer, but there has also been a rise in counterfeit items and a perception of moving away from their handmade roots.

Prime shoppers may also find free expedited shipping through Handmade at Amazon for select products.

What’s in it for vendors?

Well, Amazon has 285 million active account shopper base, so that’s a ton more eyeballs on your wares than Etsy’s 22 million active accounts. Amazon is also offering sellers logistical benefits as well, such as lot shipping through their fulfillment centers across the country, enabling Amazon to ship the goods as part of the Prime program. On the site, sellers can develop a profile page to introduce themselves and their passion for their product, and also promote their goods through Amazon’s Sponsored Products advertising program.

Greater traffic and exposure, along with shipping, are certainly beneficial, but at what cost. According the NY Times:

Most sellers are likely to give Amazon a bigger cut of their sales for that reach, however. Etsy charges a 20-cent fee for each item a seller lists on its site and takes a 3.5 percent cut of the sales. For now, Amazon will charge no listing fee but take 12 percent of sales, which it says covers all costs, including payment processing, marketing and fraud protection.

Given that most of the vendors behind handcrafted goods are small, independent outfits, some still hobby enterprises, the addition of Amazon as another avenue for selling may add a layer of complication for folks already selling on Etsy or EBay. However, with increased traffic could come more consistent sales and more stability, and they may be better off opting out of their former markets.

What’s in it for Amazon?

Moving into the handmade market place isn’t a huge stretch. Amazon already has a general marketplace open to vendors. But it’s clear, Amazon is spreading its capabilities and diversifying offerings. While it has done this for years through products, some with more success than others, the company is geared up to take on services like grocery delivery and home repairs. So why not get a stake in the ever-trending artisan market, in this day and age of pinspiration? Why not put a different face on what IS Amazon? Through the handmade marketplace, Amazon becomes a supporter of the little guy, the independent, not just a big company pushing mainstream products like it’s big box competitors. It’s another feather in the hat for Amazon, so let’s see how this goes.

Your Own Personal Retail

Like so many people do this time of year, my husband and I decided to make a change and move. Specifically, we chose to uproot from a one-story house in the Dallas ‘burbs to a three-story townhouse downtown so that we could be closer to the things we enjoy doing, reduce our commutes and make a step towards becoming a one car family. All that being said, we needed to not only downsize but to use our move as a opportunity to clean house and get rid of all the extra stuff the two of us accumulated over the years. And so over the past few months, I’ve been on an adventure in personal retail and resale. With the perspective I have as retail marketer, I would fine tune my approaches, observe potential buyers of my wares and take note, and wonder where brands could authentically fit into this very organic, grassroots shopping arena. Here are a few of my takeaways after diving head first into the world of personal retail.

The Yard Sale

The yard sale is still a mainstay and key route to selling your extraneous stuff in a time crunch. Step 1: Organize and promote your sale. One can still go with a low-key approach of posting a few handmade posters at key intersections the morning of your lone yard sale because there are still people that shop for yard sales by driving around early Saturday mornings looking for said signs. However, in 2015, you can do better without a ton of effort. First off, there’s power in numbers. Multi-family yard sales are typically big draws. Propose a neighborhood yard sale day, or even take it further by partnering with another neighborhood. With just a few clicks on your neighborhood’s Facebook or NextDoor pages to rally the cleaning house spirit, you can exponentially drive traffic to your front door and boost your sales. A simple post on your personal social media can go a long way – in fact, you’ll be amazed at the responses you’ll get, the shares of your post and who of your friends is or knows a yard sale connoisseur. Post on Craig’s List, which has pretty much replaced the classified ads in local papers and it’s free. Post about it on the virtual yard sale groups (more on those later). And just think, if all your neighbors are doing this, too, that network will be spreading the word beyond your reach to their mom groups or their work friends, etc.

Yes, the day of your sale, you’ll still want to put out some kind of signage to direct people to your sale, but for the most part, the leg work is done and you just have to focus on Step 2: Close the sales. In my opinion, cash is still king, so it’s important to be able to make change. Staging your goods is important because only the rare yard saler is going to want to dig around in your stuff. In fact, plenty of shoppers will do the “slow roll” in their car to scope out what you’re selling without getting out of their car. Suggest bundles to make folks feel like they are getting a deal (and it also gets more of your stuff gone).

Even with all that, be prepared to see shopping behavior that you wouldn’t have expected. People will walk away from deals over a difference of 25 cents. I had a shopper spend no less than 20 minutes looking up reviews on Amazon for some of my items – showrooming is not uncommon with brick and mortar shopping these days, but at yard sales? Really? Really. I also had another shopper Facetime his wife for nearly 30 minutes over $2 storage containers, which he ultimately passed on. If I wasn’t in shopper marketing, I probably would have been guilty of an eyeroll or two, but it was all very fascinating to observe the trickle down effect of technology on even yard sale shopping behavior.

What’s in it for brands? Some retailers have already gotten in on the direct connection between yard sales and moving by selling yard sale signs on the same aisle as moving boxes. Organization brands, like Container store, could sponsor National Yard Sale Day (the second Saturday in August) with parking lot events or promote offers to help you stay organized once you’ve decluttered.

The Virtual Sale

There seems to be about a million different ways to sell stuff virtually. From EBay to Etsy to Craig’s List, you can sell your stuff, but much of that depends on knowing your target audience and understanding the medium. Etsy is really more about selling crafted and made products, not so much for selling your old high school calculator. EBay can do instant sales, but it’s still mainly about the auction and you will have to make time for shipping. Craig’s List can be very hit or miss in terms of the kinds of buyers you’ll attract, and I always approach it with caution to never meet anyone alone. These days, you have even more options and even more control over how to sell things online and via apps, but I’ll touch on the one that seems to be gaining the most traction in my opinion, the Facebook Sales groups.

I probably joined my first Facebook sales group a few years ago at the invitation of a friend. It essentially served as a virtual garage sale. You could post a picture of an item, the sales price and approximate location of where it could be picked up. Interested parties would comment and then through private message, work out the details to finalize the sale. Over the years though, it’s become a culture, complete with it’s own language, rules and trends. The dynamics of these groups evolved so much that Facebook even created a new post form specifically for groups to help streamline the essential details of a post and requiring those details before a post could be submitted.

Let’s talk about the lingo. Want and Next comments are enough to solidify your place in line. Porch Pick Up means I’ll leave it for you on my front step and you better leave the money for it under my doormat when you come to get it. PPU means pending pick up, which a seller will post to indicate that the sale is almost done but since sales fall through all the time don’t lose hope entirely. A seller can also comment Bump to send their post back to the top of the group’s news feed to ensure fresh eyes see it. X-posted means you’ve posted this item across several groups, so even if it looks like you are first in line for an item, someone in another group make actually be first. No holds means the seller isn’t hanging onto the item for anyone, it’s a first come, first serve to make the sale.

The trends are fascinating to me. Pinterest inspiration is a big one here. For example, in the last year or so on these groups, I’ve seen a spike in the sale of “project pieces,” specifically rehabbed wooden coffee tables, end tables, entryway tables, and consoles painted in bright pastels or bold colors. Most of the time, these sales are for the completed projects, but there are also plenty of the incomplete “I bought this with the intention of rehabbing it and either my time or my skill level prevented me from actually finishing” pieces. There are bloggers and youtube channels dedicated to teaching people how to bring old furniture back to life with chalk paint and glaze. In the past, people used to go to flea markets to find these project pieces, and now they don’t even have to leave the comfort of their homes if delivery of the piece is included. (Other current trends I’ve seen in these include wood pallet crafts and barnwood/farm tables).

What’s in it for brands? Furniture and craft brands should be looking into this underground network for insights and noting these trends (much like fashion designers seek inspiration from people on the street or dancing in clubs). For instance, I would love to see a long established furniture company like Bassett or Broyhill run a targeted FB promotion that asks shoppers to rehab one of their brand’s furniture pieces from the 60s or 70s for a chance to win a $10,000 living room makeover. It authentically ties into what this audience is already doing, establishes the heritage and quality of the brand, and is prime for social sharing.

The Resales

Consignment and second hand shops have been around for decades as yet another avenue for getting rid of your unwanted items. From clothes to books to furniture to sporting equipment, these days sellers can not only look to brick and mortar specialty consignment/resale stores but also to any number of apps to consign their wares from the convenience of their phone. For my purposes, I went the brick and mortar route for the luxury of immediacy.

Dallas-based national chain Half Price Books, while known for selling new and used books at a discount, is a great resource for getting cash for your old books, magazines, CDs, DVDs, videos and, dare I say, even laser discs. It’s a very familiar process for anyone that ever sold their study books back at student bookstore at the end of a semester. You bring your items in, a store clerk looks them up in their system while you wait in the store and you receive a cash offer for the total of your bounty. Demand and condition are the main factors for determining offer prices. Unless you are trying to sell something special, like a signed, limited first edition Harry Potter, they don’t break it down for you item by item – it’s a lump sum, take it or leave it. Don’t expect to make out like a bandit selling your books and CDs back, but something is better than nothing. Also keep in mind, what they don’t resale, Half Price Books will donate to nonprofits in support of literacy, so you can feel good about where your items are going. (Don’t have a Half Price Books near you, Amazon also has a trade-in program.)

Clothing consignment can be a bargain shoppers dream, but for someone looking to unload unwanted clothes, it can be a little confusing and nerve wracking. So many of these stores are locally-based and have their own guidelines for selecting what items they’ll take and the method for selling, which means every store is different. For my needs, I opted to give national consignment store Clothes Mentor a try. Here, you bring in your items, a store clerk accepts them for review and gives you an approximate time for your estimate to be completed, then you receive a text to let you know your estimate is ready, and upon return, they’ll walk you through what items they want and what they are willing to offer. Based on my experience (and from reviews I’ve read of others’ experiences), it’s completely hit or miss and not much rhyme or reason as to why they want some items over others or offer a certain price. Seasonality and condition can play a roll, but for the most part, they tell you it’s about your items not being the latest style. I was told this about a batch of clothes I brought in and yet one of the shirts they did buy from me, I kid you not, was 12 years old. It’s a roll of the dice, and again, something is better than nothing.

And then there is Good Will. An American mainstay in donated clothing, furniture, electronics, etc, Good Will makes these things accessible to people of all economic levels, but their stores and proceeds also go to support job creation and career education. Any true purge of belongings should involve several trips to your local Good Will, where you can get a receipt good for writing off your donations on your taxes. Win-Win for everyone.

What’s in it for brands? Clearly, specialized brands in the market of resale know their niche and understand their place in the resale market. But with all these burgeoning apps furthering simplifying the resale of not only the things you don’t want (like that sweater your mom gave you for Christmas without a gift receipt), but also of luxury and high ticket items that you may have used once and no longer have a need or space for them. It’s also important for brands to consider the benefits of trade-ins for credits over cash, which ensures the money essentially stays in there pocket but almost always guarantees a greater return as a shopper has to spend more than their credit to get the benefit of spending it all.

Image: Getty

Targeted Marketing takes Aim

That time West Elm advertised to me with a photo of my living room:

Last week, I was scrolling through my Facebook newsfeed and came across a photo of my living room. This wasn’t something I had posted on Facebook, it was a West Elm ad. I snapped it on my iPhone when my new couch finally arrived and uploaded it to Instagram with the hashtag #mywestelm.

In April 2015, Facebook began testing a new product ad with Olapic that pulls in user-generated content for ad imagery. This is the first true test of user-generated content in a Facebook ad.

In the past, consumers didn’t want to interact with brand content on their social platforms. But with the rise of image-based platforms like Instagram and Pinterest, a shift happened. Consumers now want to share how they engage and interact with their favorite brands and products. Because of this and consumers’ need and desire to have everything hyper-personalized, we are seeing the rise of user-generated content, from staged food photos on Instagram to product hacks on Pinterest. When consumers started seeing products friends and influencers were showing interest in, they found a desire to buy, right from social. They became shoppers.

Facebook is taking the Instagram and Pinterest user experience that motivates shoppers to make a purchase, and applying it to their ad units. West Elm didn’t know they were showing me my own photo (why would they sell me a product I already own?). What they do know is that consumers are more responsive to user-generated photos than branded content and I was the type of consumer likely to shop at West Elm (which is very accurate). My photo could have sold someone a coffee table. I should probably take a new picture now that I have a new West Elm rug.

Special Delivery! The Rise of the Box

Special Delivery! Subscription-based retail delights both customers and brands. Customers are often on autopilot when it comes to shopping for their weekly staples. Both traditional brick-and-mortar and online retail giants are great at providing customers easy access to the things that are regularly on their shopping lists.

Shopping, however, isn’t just utilitarian for some. For product junkies, shopping is also about the hunt for new and different products: things you may not have considered or have known about for various reasons. This desire for novelty, combined with personalization and convenience, is the impetus for the growing ecommerce model that is subscription boxes.

These days, it seems like there’s a subscription box for everything. Love make-up? There’s a box for that. Looking to bond with your child? There’s a box for that. Need to tame your beard? There’s a box for that too. There are even services out there that can help others start their own box businesses.

Growing up, one of my favorite shopping experiences was going to the local drug store with my dad, where he’d purchase me a kids “grab bag:” A surprise selection of goodies mysteriously packaged in a brown paper sack. Most of the time, I was delighted by my unforeseen bounty. Sometimes, however, I was just very disappointed.

That is what’s so great about today’s subscription boxes: all of the thrill, none of the fill. What’s not to love about a monthly surprise delivery of goods curated just for you? With an array of products and price points available, customers can easily incorporate both impulse purchasing and trial buying into their budgets. According to one Ipsy subscriber, “I tend to wait for the subscription to come, and generally just buy products I know from my delivery when shopping in-store.”

Customers aren’t the only ones who are benefitting. The box is a subscription-based model, which provides consistent revenue streams, which is–of course–good for business. When retailers focus on single products, sales can fluctuate wildly from month-to-month. By leveraging loyal customers via subscriptions, income becomes steady and predictable. Further, brands partnering with box businesses get their products into the hands of shoppers who otherwise may never have given the product a try.

Retailers such as Target and Amazon are incorporating subscription services into their ecommerce experiences, capitalizing on the convenience that shoppers love about boxes. Independent box businesses continue to grow, however, and until traditional retailers can offer the kind of curated personalization that speaks to these customers, boxes will continue to charm the hearts and wallets of customers around the globe.