Ecommerce logistics and subscription ecommerce logistics are not created equal.
In fact, it was such a pain for us when we were shipping our own subscription boxes (more than 60,000/month) that we took our learnings, pivoted the company, and launched our own fulfillment services to become a full subscription-first 3PL.
Would you like to know what to do and what not to do when finding a subscription first 3pl partner? We have helped hundreds of ecommerce founders and operations leaders make smarter, more strategic choices for the fulfillment, shipping and overall logistics of their products – and a recent podcast episode goes into just that.
Our CEO and founder, Paul Jarrett, was recently invited on the Logistics of Logistics Podcast to talk about subscription box fulfillment, why it’s a powerful play to recoup more of your revenue (vs giving it to Amazon!), and how to avoid mistakes when selecting the right partner to scale and grow your ecommerce company.
Listen online, or continue scrolling for a recap of the key takeaways:
Key takeaway #1: Subscription is both a marketing and a revenue play
There are a number of products that exist in ecommerce that can be moved to subscription. Even if it’s not the main product, there is likely an ancillary product that aligns well.
For example, you may not buy shoes on subscription, but you could introduce shoe cleaner or odor eliminators as the subscription component of that since it’s a consumable and will be needed to preserve the life of the larger purchase.
“By getting somebody on subscription, you're reducing your customer acquisition cost. You're reducing your shipping cost because you're able to predict your future with the carriers and you're increasing the customer lifetime value because it is an expectation for customers to be able to order that.” – Paul Jarrett, CEO of Bulu
Additionally, the subscription experience means that you’re in their household on a regular basis like a direct mail campaign would be. You can leverage your product delivery to upsell and cross sell additional products through the very means of your subscription. It also allows you to strengthen that relationship with the customer in a unique way that’s hard to replicate.
Key takeaway #2: Most 3PLs don’t have subscription experience and could actually damage your brand experience
Smart ecommerce founders recognize the value of a good 3PL partner as subscription box fulfillment done right can lead to improved scalability, cost-efficiency, and overall operational performance. By offloading logistics and fulfillment to experts, ecommerce companies can focus more on their core business—delivering outstanding products and services.
However, if done wrong, customers churn and word of mouth goes sour. The number of intricacies involved in subscription box fulfillment calls for deep, situational expertise – and that’s not something you want to learn the hard way.
“Subscription box fulfillment goes beyond merely getting the product to the customer. It encompasses everything from accurate inventory management to speedy delivery, facilitating seamless end-to-end transactions,” says Jarrett. “It means the difference between kitting and pick and pack, whether or not you need climate-controlled logistics, and if/how you add a hint of the brand experience with the unboxing and customer delivery.”
Businesses need to ensure that their subscription box fulfillment process is optimized for both speed and accuracy to ensure that their customers consistently receive their products in a timely manner.
“This is where Bulu comes in with a ton of experience. We’ve done up to 60,000 monthly subscription boxes for ourselves, so we know first-hand how to manage logistics at this scale for all types of subscription fulfillment.”
It’s critical that you ask the right questions when selecting an ecommerce 3PL logistics partner as times have changed! 20 years ago, a logistics company was used to packing and sending out 800 palettes to big box stores – not 80,000 small parcels to individual customers. This alone is enough to cause an ecommerce founder to pause and verify experience before selecting a partner.
Key Takeaway #3: Remember, it’s like Christmas day every delivery to the customer
Customers order online because it’s convenient, but the very act of receiving a package in the mail is a fun and exciting one – even if they know what’s in it of course! The right logistics partner understands the joy and excitement that come with this responsibility and will be looking for ways for you to level this up.
For example, in the podcast, Paul talks about how, in working with Crayola, it was important to engage the senses to bring about nostalgia and memories for the customer.
“We were embracing the smell of crayons and how that would take you back to third grade, being the teacher’s pet, or maybe even spending time in the principal’s office,” Paul says. “That taste and feel is important to the experience. But you also have to manage that in relationship to the weight and size/shape of the box. You can’t just start throwing a lot of crayons in there for the experience because it may affect your rates and overall margins.”
For all of the insights, listen to the podcast here.
Bulu is a subscription-first, full-service 3PL. We’ve launched and fulfilled subscription boxes for Fortune 500 companies like Disney, GNC and Crayola as well as growing ecommerce companies. Our warehouse, processes, training and software is designed to meet the needs of subscription first. We’ve seen how subscription boxes or subscribe & save functionality can grow customer lifetime value, increase customer retention and grow a business overall. That’s why we’ll install subscription buying options to a Shopify site FREE when you partner with us for fulfillment.
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