With a recent infusion of $80 million and over one million members, the subscription box service kicked the year off well. Executives may have a solution to keep boxes fresh.
FabFitFun doesn’t want to tell you how you should look, how you should dress or how you should feel. FabFitFun just wants to be your best friend. The best friend, that is, “that just happened to know everything about beauty, fashion and fitness.”
At least that’s how Katie Rosen Kitchens, co-founder of the subscription-based service and editor-in-chief of its media arm, describes it. In many ways, it sounds like a useful best friend to have — one that’s always digging up cool new products and sharing them with you — but that’s where the analogy falls short. Because most shoppers don’t pay $49.99 seasonally for the luxury of having a well-informed bestie.
In reality, FabFitFun isn’t asking customers to pay $50 for a best friend’s advice every season. Members are paying that much to receive $200 worth of products every three months, discounts on other items sold through its website and access to a whole community of FabFitFun lovers, as well as workout and cooking content.
“Our goal is really to be the most valuable membership in a person’s life,” Rosen Kitchens said in an interview with Retail Dive. “We believe with FabFitFun, you are never too busy to take care of yourself.”
Thinking outside the (subscription) box
There are subscriptions for just about everything, from apparel to beauty to food. FabFitFun falls somewhere in the middle of a few spaces, with a mix of apparel and accessories, home items and fitness products. In some ways, it’s aiming to be a lifestyle box the way that so many direct-to-consumer businesses are trying to become lifestyle brands.
The appeal of a lifestyle brand, at least to a consumer, is largely that it tracks with their own likes and dislikes across several tangentially related categories: a one-stop shop for that piece of their life. One needn’t look far to find examples of brands doing exactly that, including unicorns like Away and Casper, which have both expanded beyond a core product into adjacent categories, aiming to be the brand for travel or sleep, respectively.
With FabFitFun, that challenge is three-fold. Not only does the company have to stay relevant in the beauty space, curating cosmetics and haircare products that its members will (hopefully) love, but the same has to be done in fitness and home products, three spaces that are not all that similar. Whereas a lifestyle brand like Away wants to resonate with a specific travel lifestyle, FabFitFun is trying to harmonize with the individual lifestyles of over one million members, on at least three separate planes.
“If you think about what we do — members are paying us for something that they have no idea what it is,” Rosen Kitchens said of the difficulties in curation. “In order to make that work, in order for them to continue to give us $49.99 every quarter, they really have to trust us and we have to continue to deliver value, surprise, delight and really enrich their lives in a way that feels meaningful.”
That’s been a big shift from when the company first launched the subscription box in 2013. According to Rosen Kitchens, FabFitFun started off with around 2,000 members, all of whom were familiar with the brand through its written content.
“They all came from the website, they were very much my demo, and it was relatively easy for me to pick eight or nine products I liked and have it resonate with our members,” Rosen Kitchens said of the early days of the business, noting that the audience is much more diverse now. “What we know is that an 18-year-old in San Diego doesn’t want necessarily the same product as a 75-year-old in Kansas City, and both women exist in our membership.”
Combating that has meant proactively reaching out to shoppers for feedback on their most recent box and giving customers the option to hand pick some of the items that will come in their box, perhaps selecting a scarf over a haircare product.
“What we know is that an 18-year-old in San Diego doesn’t want necessarily the same product as a 75-year-old in Kansas City, and both women exist in our membership.”
Katie Rosen Kitchens
Co-founder and Editor in Chief of FabFitFun
Customers also play a key role in the selection process while the next box is being planned. Employees on FabFitFun’s consumer insights team survey customers about which brands they like, what trends they’re excited about and other preferences to get an idea of where they should go looking for their next batch of products.
An additional layer of quality control comes through a testing phase after products have been selected.
“Everyone on the team, from merch to operations to marketing to editorial, really get their hands dirty and try out these products to make sure that they are, one, as effective and wonderful as we believe them to be, and two, that they’re going to resonate with our incredibly diverse membership,” Rosen Kitchens said. “That they look good on all different skin tones and skin types, that they fit on different body types, etc.”
Keeping things fresh
The other challenge with running a subscription-based business, in addition to curating boxes well, is maintaining excitement around a product that comes on a regular basis. Challenges with retention vary depending on the source of the analysis, but one survey from last year found that almost 40% of subscribers end up canceling their services, and only 55% of consumers who consider a subscription actually end up signing up for it.
Other studies have taken a more positive look at the model as it gains momentum with younger demographics. An August report by Magid found that renewal rates for subscription services were 85%, with club, fitness and food memberships being the most popular.
While subscription services are certainly catching on in retail, with Gap and Target even launching kids subscription boxes, the ability to retain customers is a constant concern from skeptics of the model. That pressure has arguably led to more flexibility in subscription services, with some offering the ability to skip a month or following a similar model to Stitch Fix, which offers a seasonal option and a one-time “fix” in addition to the monthly product it became famous for.
FabFitFun’s solution to the retention issue was to launch with a seasonal service rather than a monthly one, which Rosen Kitchens believes is a big driver of the brand’s user-generated content.
“What we found is this three months in between boxes really helped to build the anticipation and the excitement,” she said, noting that when the boxes finally arrive customers have “been waiting for it” and jump onto social media to share their favorite products.
Brand and product assortment also play a role in keeping the box fresh every season. Not only does the company try to balance the boxes with a variety of personal care, home, wellness, apparel and accessories products, but they also include a mix of established, well-loved brands with up-and-coming brands that their members might not have tried out yet.
Read the full post on Retail Dive.