What is the outlook for subscription box services in 2022?  

Editor’s note: Jeremy King is CEO of consumer research platform Attest. 

In 2020, subscription services became the cornerstone of America's booming e-commerce industry. 

Early in the COVID-19 pandemic, consumers appreciated subscription services, and having items – both necessary and luxury – delivered to their doors became a part of our everyday lives. More time at home meant more time for hobbies and passions too … another boon for subscription services. Indeed, 26% of U.S. consumers ages 18-40 purchased a new subscription during the pandemic.  

As we get closer to 2022, subscriptions are gradually becoming less popular among American consumers. In 2021, 41% of Americans say they have an active product subscription, compared to 47% of consumers in 2020. And just 18% have multiple subscriptions, compared to 21% last year. There has been a decline in the number of consumers actively looking for a new product subscription, down from 18% in 2020 to 14% today. 

While these numbers might make for grim reading for U.S. subscription brands, there are plenty of reasons to be optimistic for the year ahead. There is still untapped potential in the subscriptions market, specifically with Millennial consumers who are willing to experiment with these kinds of services.  

What Americans are subscribing to 

The most common subscription category for U.S. consumers in 2021 is food and drink, as it was in 2020, with 37.4% signed up to at least one subscription. Personal care, health and fitness came a close second, with 35.7% of Americans having a subscription in this category.  

Up from fifth place in 2020 to third in 2021 was pet product subscriptions as consumers show their willingness to pamper their furry friends, many of whom were acquired during the pandemic. Older consumers are driving this growth in pet product subscriptions, with 35% of Americans ages 55-66 having one, compared to 32.5% overall.  

Toiletries and cosmetics and clothing and shoes came fourth and fifth in the category ranking, closely matched on 29.7% and 29.4%, respectively. Hobbies featured sixth on the list with 21.9% of Americans holding an active subscription in this area, covering a wide variety of interests including reading and gardening.  

Why Americans are subscribing 

Of all survey respondents, 32.3% said that they purchased a subscription primarily because the product is delivered straight to their door. This figure represents a doubling of the number of people who gave the same answer when asked this question in November 2020. Among the Boomer generation, 45% of respondents gave this as the key reason for purchase.  

One of the more surprising findings was that the number of people who purchased a product subscription because they love the brand or the brand's ethos dropped from 18% to just 10%, which is food for thought for marketers. However, of all generations, Gen Z was the most likely to cite admiration for brand ethos as a reason for purchasing, so there still looks to be value for vendors to keep working on their messaging in this area.  

Millennials ages 26-40 are the most committed to product subscriptions with 49% reporting having one or more. Other generations seem to be falling out of love with subscriptions. Gen X (ages 41-55) are most likely to say they had a product subscription in the past but not now (32%), indicating subscriptions may have failed to deliver value for this age group. Across all categories, there is a steady 29% – the same figure as last year – who say they have never had a product subscription.  

Getting the right balance  

Digging deeper into the data, we can begin to uncover the different elements required to create subscription services with wide appeal. Value for money is the most important factor for Americans when it comes to purchasing subscriptions, cited by seven in 10 respondents. Flexibility is also one of the key considerations, with 54.3% wanting to pick and choose what products are sent in a subscription box and 53.2% wanting to be able to pause or cancel easily.  

Brand reviews are also important to 39% of consumers, especially among Gen Z – 53% of respondents in this category said they would be looking for great reviews. Gen Z is also motivated by exclusivity, with 38% asking for products that aren't available anywhere else compared to 34% overall.   

Marketers take note – a recommendation from a friend or family member is the most influential factor that pushes someone to consider a subscription box brand. This was true across all generations, and highlights the need for subscription services to develop effective referral schemes.  

But don't reallocate your entire advertising budget just yet – advertising was cited as the second-most influential factor, ahead of social media buzz. However, among younger generations these two positions were reversed, with Gen Z and Millennials ranking social proof as more influential than advertising.  

The outlook for subscription box services in 2022 

While the pandemic boom is starting to wear off for U.S. subscription brands, there are still many opportunities for subscription services to enhance and refine their offerings. There is still a clear appetite among the American public, with 65% saying they are open-minded to purchasing a product subscription. In fact, only 21% say they’re unlikely to consider a subscription – down from 27% last year. 

There are some interesting gaps in the market. One of the most notable is cannabis, which is now legal in 18 states recreationally and in 37 states for medical purposes. However, alcohol was the most mentioned product by respondents. Even though this category is already well served, new ideas revolved around niche offerings such as boxes with small samples of beers and spirits, and boxes that mixed alcohol with cosmetics and lingerie. 

Marketers looking to improve should pay attention to the generational attitudes, especially the tendency toward conscious consumerism displayed by Gen Z. The U.S. subscription market faces a challenging 2022, but there are opportunities for brands that can find the right blend of value, convenience and flexibility. 

Methodology 

The total sample size for this research was 2,000 nationally representative working-age consumers based in the United States. The survey concluded on 19 August 2021. The full report is available here (registration required).