INTERNATIONAL TRADE NEWS Title
THE SUBSCRIPTION & GIFT BOX BOOM The world has been experiencing a ‘subscription and gift box boom’ over the past five years.
According to a UBS report, in the U.S., the subscription box market is expected to be worth $1.5 trillion by 2025, doubling the $650 billion it’s worth today.
The UK Subscription Box Market report by Royal Mail shows that food witnessed the highest growth year-over-year in 2020. Another area of high growth has been in essential non-food items, such as male grooming and other predictable replenishment items. The male grooming subscription market grew 108% between 2017 and 2020 to reach a value of £41.7 million.
Closer to home, the subscription box market in the U.K. is expected to be worth €2.13 billion by 2025, compared to €648m in 2017. On average, companies offering subscription services grew four times faster than the S&P 500 in 2020.
Elsewhere, other everyday health and beauty products are also seeing strong growth. This sector has grown from being worth £43 million in 2017 to £79 million in 2020. It is forecast to grow to £92 million by 2025.
In Europe, the U.K. has been the market leader in this sector and Irish companies should look to trends in the U.K. to predict consumer behaviour in Ireland.
While competition between companies offering subscription boxes is stiff in the UK, the market potential for growth is still immense across the EU.
The sector had seen high growth in the years preceding the Covid pandemic and sky rocketed in 2020 due to retail closures, work from home mandates and increased disposable income.
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In 2020, a report found that only 20% of EU citizens were aware of the concept of a subscription box, as opposed to 30% of U.K. citizens who were already signed up to at least one.
IMRG recently reported that almost half (44%) of U.K. online shoppers, 30% of the overall population, now subscribe to some kind of subscription box service, up from 27% in 2017. Of them, 74% are signed up to multiple services and 56% are signed up to four or more.
Over half (56%) of EU companies in a recent poll say they plan on introducing a subscription box in the next 12 months.
Over half of 25 to 34-year olds (52%) are signed up to at least one, compared to 12% of 55 to 64-year olds and just 8% of those aged over 65.
For companies looking to introduce a subscription offering, a useful place to start is looking at the three different types of subscription boxes, Curation, Replenishment and Access.
