Business Case: Subscription retail
Retail is all about maximising the productivity of stores, and making sure each square metre is contributing to the overall margin. Is it still true in a world where online sales are growing, sometimes at the expenses of the sales performed instore? How do you maintain the profitability level, linked by definition to the traffic and its quality, when customers are stuck at home due, for instance, to a pandemic?
In many industries, the question is acute, and various players have been looking at innovative solutions to maintain their profitability level. We explore in this article the different models at hand with examples from all industries: members’ clubs, subscription boxes, Saas, and rundles.
Subscription retail is growing as it fits the new customer’s mindset of living an experience instead of owning "things". Interestingly, it also corresponds to the central role of department stores: a place mixing experience and curation in landmark buldings in the heart of our towns.
IADS provides its members with a weekly in-depth analysis on retail-oriented topics. This is an example of the themes the Association regularly addresses, and the topic of an article from the IADS members-only newsletter date 20 January 2021.