Sections

ideals
Business Essentials for Professionals



Online Subscribers The New Focus For Consumer Giants


01/18/2019


Online Subscribers The New Focus For Consumer Giants
The rising taste of consumers to wanting food household goods delivered automatically is planned to be catered to by some of the major consumer companies including Unilever, Procter & Gamble and Nestle. However experts say that this strategy has not been always successful.
 
Stable revenues, lower delivery costs and valuable data about customers are the aims for such consumers companies behind launching of new online subscription services.
 
A subscription program for nutritional drinks in Japan has been launched by the largest biggest packaged food company in the world Nestle and it has also expanded its ReadyRefresh program which delivers bottled water service online in the United States. The company’s Nespresso coffee is already popular among consumers. The company also plans to increase the reach of its Tails.com subscription pet food program to the rest of Europe from the current market of Britain according to reports and the company is running a pilot project for the same in France with the aim of introducing it sometime later this year. 
 
And recently, following positive test results for its Skinsei brand in the United States, Unilever is all set to introduce it. This program offers “personalized” skincare to consumers against subscriptions. In 2018, the company included cologne and beard oil and toothpaste in 2017 to its Dollar Shave Club subscription razor service.
 
On the other hand, Gillette on Demand razor subscription service was expanded to Canada by the largest home and personal care company in the world - Procter & Gamble. Under this program, subscribers can get their products by simply texting their readiness to receive their next shipment.
 
Manufacturers are allowed more control over pricing, promotions and merchandising through selling directly as there are no retailers in between. This can be a good strategy for consumer product companies at a time when they are being pressurised by the likes of Amazon and Sainsbury’s for more discounts and such companies also coming up with their own label products.
 
Goods can be cheaper to deliver, offer better consumer data and generate revenues for consumer product companies through subscription selling.
 
“They’re getting it to you on a specific date, but they don’t have to get it to you in one or two days,” said retail analyst Scott Mushkin at Wolfe Research. “It’s a way for them to manage down their logistics and distribution costs.” Amazon has offered discounts since 2006 with its Subscribe and Save program, which gives people up to 15 percent off when they sign up for repeat deliveries of household items.
 
Tom Furphy, CEO of venture capital firm Consumer Equity Partners said that this mode of selling is now “a multi-billion dollar business inside Amazon.”
 
In 2018, mysubscriptionaddiction.com’s hottest category was children’s educational boxes, followed by grooming, make-up and beauty, said Liz Cadman, founder of the US website. She said that the biggest losers were snacks, clothing and pet goods.
 
(Source:www.reuters.com)