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| VIEW EVENT INFORMATION: Birchbox |
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Launch Of Second Subscription service |
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About the organization Birchbox:
Type: Business
Sub-Types: Website, Retailing Agent, Internet, E-Commerce, Cosmetics, Beauty, Online Store, Subscription Service |
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Notable Organizations: Birchbox, Techcrunch
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| Subscription beauty service Birchbox is launching a new, pricier tier to its service, offering customers the ability to better customize their monthly box of products, along with other perks. The service, which is only being offered to current subscribers for the time being, is $14 per month, compared with $10 per month for the original subscription.
The launch comes after a time when Birchbox had been in the press due to its struggles with achieving profitability. As Recode reported in August when the startup received a $15 million lifeline from investors in the form of a convertible note, the company had faced numerous challenges over the past year or so. This included a rash of newer competitors like Michelle Phan’s Ipsy as well as layoffs. The report also suggested there may have been struggles with customer churn as current subscribers tired of their boxes, and inefficient marketing spend. (Birchbox denies these claims.)
Birchbox had also shopped for a potential acquirer last year, The WSJ reported in June, but failed to achieve a deal.
The idea with Birchbox is to allow customers to sample beauty products – like makeup, hair and skin care items, among other things – through a monthly goodie box. Customers are then encouraged to buy the full-sized items online. But, as Recode noted, only 35 percent of Birchbox’s revenue came from the sale of full-priced products. (That 35 percent figure is still accurate, a Birchbox spokesperson confirmed.)
The company also has a retail store in New York, which contributes to sales.
In total, Birchbox has over 1 million subscribers, and 4 million total customers.
As for the new subscription itself, it appears to be aimed at sending customers more of the products they’re interested in, which would hopefully translate to more online sales. |
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