What: As subscription services shift their strategies, as many as 75% of DTC brands will have a subscription-based offering by 2023.

What it is important: The DTC subscription boom is attributed to Gen Z and millennial shoppers who have begun earning money, especially affluent consumers in urban areas that prefer automated purchasing. On the brand side, the report attributes the growth to platforms like Shopify, ReCharge or Rodeo making it easier for brands to establish their DTC subscription business.

Among the risks DTC brands face in providing subscription offerings are, customer acquisition cost, churning and cancellation, funding, and subscription fatigue.

DTC subscribers tend to be urban women, between 25 and 44 years of age, earning a salary between $50,000 and $100,000 and living on the East Coast. The typical subscriber also frequently shops with Amazon and relies on its product reviews.

The U.S. comprises 47% of DTC subscriptions, followed by Europe (21%) and China (14%). In 2020, the gross merchandise volume of the monthly subscription box segment spiked by 80% compared to the previous year, but the GMV of subscription boxes is expected to decline as the economy normalizes from the pandemic.

75% of DTC brands may offer subscriptions by 2023