The Subscription Industry Hones In On A New Audience: Kids

The market for subscription boxes has moved far beyond just clothes, razors and easy-to-make meals. Today, it seems as though there is very little we can’t have delivered right to our doorsteps with a click of a button. But now, many marketers are diving into new territory, taking on a much younger demographic with subscription boxes made specifically for kids.

Subscription Marketers Make Room For A New Audience: Kids

Of the five product categories currently driving the most growth in subscription boxes (lifestyle, food, beauty, pets and kids), the number of boxes for children has increased the most as of late. And it makes sense, as 90% of the younger demographic, specifically Gen Z shoppers, actively use subscription services — Millennials follow close behind at 70%.

The trick with subscription boxes for kids, however, is understanding the importance of targeting their parents just as much as the kids themselves. Whether a brand is targeting parents seeking affordable clothing options, moms and dads trying to be more environmentally conscious or families that want to allow their children to explore different toys to see which they like before purchasing, marketers are navigating the many ways in which they can attract kids and their parents.

An abundance of companies in the subscription industry have emerged ready to attract the younger market with kid-focused subscription boxes for toys, books, fashion and more:

• Monti Kids sends a box of educational wooden toys, along with a detailed email and video instructions for parents on how to introduce each toy to their children.

• Kiwi Crate offers a variety of subscription boxes filled with science and art projects to inspire kids to explore STEAM — science, technology, engineering, art and math.
• Bitsbox was created to teach kids how to code. Each box offers a variety of coding projects that range in difficulty. Kids can log onto the Bitsbox website and use the code included to build and customize their apps, which can then be shared online or through mobile devices.
• BabyGap announced the launch of BedtimeBox, a new subscription service aimed to help parents keep up with their growing babies’ pajama needs during the first two years.
• Rent the Runway created RTR Kids, offering high-end designs for little fashionistas. The launch was an extension of their fast-growing startup, which was recently valued at $1 billion.
• For a more affordable clothing option, Walmart partnered with Kidbox to create a kid-friendly clothing subscription service designed for busy parents looking for easy-access clothing for their kids.
• Nike launched its first shoe subscription service for kids called Nike Adventure Club following a successful test program which raked in 10,000 members.
• Foot Locker recently invested $12.5 million in kids’ apparel company Rockets of Awesome, which offers kids clothing subscription boxes to parents.

The Larger Subscription Economy Remains On An Upward Trend

The surge in popularity of subscription boxes for kids stems from the abundance of innovation and success within the broader subscription landscape. Over the past five years, the subscription box market has grown more than 100% year over year (YOY), with experts predicting the industry will continue this upward trend for the foreseeable future. As of 2018, there were almost 7,000 subscription box companies globally.

According to a recent report from Fuel by McKinsey, the largest subscription box ecommerce companies brought in $7.5 billion in sales in 2018, up 30% from 2017 and up 525% from 2014. By 2023, 75% of organizations selling direct to consumer (DTC) will offer subscription services, according to a report by the Subscription Trade Association (SUBTA), with global subscription commerce accounting for 18% of the market.

Subscription Boxes For Kids Offer Marketers The Potential For Long-Term Relationships With Parents

The benefits of launching into the subscription box industry are evident. Beyond just a steady stream of revenue and increased personalization for consumers, marketers are now being given the opportunity to solve needs for parents of younger children. In doing so, marketers open the door to creating positive (and potentially long-term) consumer relationships and establishing brand loyalty among a new market.

Ultimately, the subscription industry doesn’t seem to be disappearing anytime soon, but it is getting more crowded. Now, it’s up to marketers to proactively identify niche audiences that are in need of subscription services. “Consumers are going to begin seeing subscriptions in every single part of their lives,” said Chris George, Co-Founder of SUBTA. “More than ever, brands are building relationships with their customers. And when you have ecommerce giants such as Amazon that can sell almost anything cheaper than anywhere and deliver it faster than anyone, your brand needs to build consumer loyalty to compete.”

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