Innovation in Marketing … the Birchbox Subscription Model

Is your business keeping up with the dizzying pace of innovation in marketing and advertising? Have you tried native advertising yet? Perhaps you have reviewed the Birchbox subscription model? Do you have the open mind Frank Zappa was talking about?

A mind is like a parachute. It doesn’t work if it is not open.

Frank Zappa

Native advertising is an online advertising method in which the business marketing goal is to gain attention by proving content in the context of the user’s experience (Wikipedia). Native ad formats match both the form and the function of the user experience in which it is placed.

Pay attention here: Jaw Dropping Guerrilla Marketing Lessons and Examples 

 

Wikipedia states that photo sharing platforms such as Instagram and Pinterest are increasingly leading the pack in terms of native advertising. A study has shown that the retention rate for visual information can reach 65% in comparison to 10% for text-based information, thus making Instagram and Pinterest the ideal location for native ads. Since its launch in October 2010, Instagram has accumulated 150 million monthly active users (as of December 2013), posting an average of 55 million photos per day which attract 8500 likes per second. Launching earlier the same year, Pinterest has 70 million users and 80% of these are women, hitting 2.5 billion Pinterest page views a month.

 

In the new world of content marketing – the world of which native advertising is one form – articles are plentiful. Phrases such as corporate journalism, vendor content, brand publishing and custom content are everywhere.

 

But where does native advertising play in this mix?

 

Put simply, native advertising is a sub-set of the catch-all content marketing, meaning the practice of using content to build trust and engagement with would-be customers.

 

Native advertising can be a promoted tweet on Twitter, suggested post on Facebook or one of those full-page ads between Flipboard pages, but more commonly it is about how brands now work with online publications to reach people.

 

They’ve long done so, of course, through display advertisements and various other promotions.

 

The difference between display ads online and native ads is that the latter are in the flow of editorial content.

 

We like to write about invention; creativity, innovation, and business adaptability (see our article Innovative Business Ideas … Creativity, Invention, or Innovation?). We believe that the more adaptable and innovative the business, the greater the probability of success. So we like to share new business ideas that illustrate adaptability and innovation.

 

Enter the startup Birchbox business model. Birchbox is the leading discovery commerce platform and are redefining the retail process by offering consumers a unique and personalized way to discover, learn about, and shop the best beauty, grooming, and lifestyle products on the market. Birchbox is a 360-degree process: experiment, learn, and decide. A process we believe works quite well.

 

Birchbox, is reporting 800,000 subscribers, and really is a next-generation beauty magazine, where the ‘pages’ are made out of product samples not paper.  Rather than take out advertising space, advertisers buy up space in the box, allowing subscribers to discover and trial their new products; supporting editorial is bundled into the box.  In other words, Birchbox is ‘native advertising’ with the advertising the sample products. Talk about content marketing innovation, this is a great example. Quite possibly the future of content marketing?

display ads
Display ads.

 

Content marketing, the use of publishing channels as opposed to advertising channels to achieve marketing goalsfor consumer products typically falls into one of two buckets – the ‘content spectacular’ (think Red Bull’s space-diving), or ‘native advertising’ – sponsored/advertorial content in media publications

 

It is in the third vision of content marketing – where content is baked into the product experience – where Birchbox sits.  The product, not the ad, is the content – and it is delivered in a way that is exciting, share-able and share-worthy.

 

How the Birchbox business works:

 

Subscription model … the Birchbox

Each month, you receive a selection of samples that the company staff have tried (and retried) themselves. They source samples from both well-known brands and emerging gems. The women’s subscription includes everything from skincare to makeup, as well as fun non-beauty extras. The men’s subscription delivers top-tier grooming products in addition to lifestyle accessories ranging from hip socks to tech accessories.

content
Visualize the content.

Birchbox subscrition business model ideas … the content

The product content helps you get the most out of your samples. The Birchbox magazine is a source of inspiration, advice, and information. It shows you how to master techniques and upgrade your daily routine with articles, expert interviews, and videos.

Birchbox subscrition business model facts … the Shop

When you are ready for more of the products you sampled, you can purchase full-size versions directly from the Birchbox Shop. The shop has a generous loyalty program that rewards you every time you shop, refer friends, and give feedback on your monthly samples. You can redeem Birchbox Points and save on any full-size or gift purchase.

 

The company’s now sharing stats that suggest this business model is showing success. Birchbox says its e-commerce sales are on track to triple this year, with more than one-half of Birchbox’s monthly subscribers going on to make purchases from the company’s e-commerce store.

 

There are also full-size e-commerce orders that come from non-subscribers. About 15 percent of the company’s orders come from customers who don’t get the monthly box of sample products.

 

The company has been around since 2010, when co-founded with two Harvard Business School alumni. They were looking for a way to help women discover new cosmetic products and started shipping boxes of samples for about $10 per month. They have since expanded into men’s products with a slightly more expensive subscription service full of lifestyle goods and grooming products.

More learning: Some Great Story and Storytelling Examples to Study

 

So, have you ever tried Birchbox? Have any comments on thoughts on this business model?

 

Here is the $64,000 question:

How could your brand profit from a Birchbox-style content marketing – native advertising that gets your product into the hands, and on the lips of your target audience?

 

social_media_strategy

 

So what’s the conclusion? The conclusion is there is no conclusion. There is only the next step. And that next step is completely up to you. But believe in the effectiveness of word of mouth marketing. And put it to good use.

 

It’s up to you to keep improving your creative marketing efforts. Lessons are all around you. In this case, your competitor may be providing the ideas and or inspiration. But the key is in knowing that it is within you already.

 

All you get is what you bring to the fight. And that fight gets better every day you learn and apply new lessons.

 

When things go wrong, what’s most important is your next step.

 

Need some help in capturing more customers from your marketing strategies? Creative ideas to help the differentiation with potential customers?

 

Call today for a FREE consultation or a FREE quote. Learn about some options to scope your job.

Call Mike at 607-725-8240.

 

All you get is what you bring to the fight. And that fight gets better every day you learn and apply new ideas.

 

When things are not what you want them to be, what’s most important is your next step. Call today.

 

Test. Learn. Improve. Repeat.

 

Are you devoting enough energy improving your marketing, branding, and  advertising?

 

Do you have a lesson about making your marketing strategy better you can share with this community? Have any questions or comments to add in the section below?

 

Mike Schoultz is the founder of Digital Spark Marketing, a digital marketing and customer service agency. With 40 years of business experience, he blogs on topics that relate to improving the performance of your business. Find them on G+Twitter, and LinkedIn.  

 

Digital Spark Marketing will stretch your thinking and your ability to adapt to change.  We also provide some fun and inspiration along the way. Call us for a free quote today. You will be amazed how reasonable we will be.

  

More reading on marketing strategy from Digital Spark Marketing’s Library:

Case Studies to Evaluate New World Marketing Concepts

How to Frame Marketing Messages for Optimum Engagement

Jaw Dropping Guerrilla Marketing Lessons and Examples 

 

 

Like this short blog? Follow Digital Spark Marketing on LinkedIn or add us to your circles for 3-4 short, interesting blogs, stories per week.

 

Innovation in Marketing … the Birchbox Subscription Model