Dietary supplement subscription programs start with convenience but should offer much more

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Today’s consumers are accustomed to purchasing products with the click of a mouse or the tap of a smartphone. But thanks to subscription services, they can secure an ongoing supply of all their favorite products, paid for and delivered, with practically no effort at all. From beauty boxes and wine clubs to hot sauce and coffee, there’s truly a subscription box for everyone. And dietary supplements are no exception.

“The supplement market is going through a major transition,” says Shawn Bushouse, president of emerging brands at Nestlé Health Science, the parent company behind Persona. “Customers are really investing more time in their wellness and demanding more convenient, more effective, and more personalized models that we’ve seen really come to life in personalized subscriptions.”

The benefits for consumers are clear. In addition to the convenience factor, services like Persona also eliminate the confusion and sense of overwhelm that many consumers experience in a supplement store. With a subscription service, consumers need only log onto the website, complete a questionnaire about their health and goals, and—poof!—a customized daily vitamin plan is generated. “It’s simple, it’s convenient, it takes away the guesswork, and, since their refill arrives every month, it keeps them on track,” adds Bushouse.

The COVID-19 pandemic also played a role, adds Ordergroove strategic client director Kyle Beldoch, when consumers subscribed in droves in lieu of visiting stores. “All these months later, consumers have stayed with subscriptions because they are convenient and cost-effective,” he says.

But the benefits for brands are even more substantial, says Beldoch. Not only do subscription services generate reliable, recurring revenue (helpful for forecasting financials and inventory), but they also help brands retain customers and grow lifetime value. “Instead of spending valuable resources to capture a customer who might make a single purchase, subscriptions enable brands to lock in customers who are going to make multiple, guaranteed purchases,” he explains. “Simply put, subscriptions are an extremely efficient business model.”

Best Practices

Brands looking to launch a subscription service can benefit from lessons learned over the course of the last few years. Bushouse’s top tip is to stay connected to the consumer, rather than treating them like a one-time transaction. Persona, for example, has a dedicated team of highly trained nutritionists and customer service representatives who reach out to customers proactively, learn about their goals and needs, and respond promptly. “We answer questions, point customers to resources, help adjust their personal pack, and do everything we can to deepen that relationship by helping them succeed,” he adds.

One of Beldoch’s top lessons learned was eliminating any point of friction during the enrollment process. “Any friction, be it poor branding or a complicated checkout process, is going to dissuade shoppers from signing up for a subscription service,” he says. To that end, he recommends that brands work with a subscription technology provider, and especially one that offers an integrated checkout that streamlines the ordering process without sending consumers to a different site for payment.

And while bundling products has been a popular subscription tactic, supply chain issues impacting one product can cause disruptions and cancellations that can affect an entire order. Instead, Ancestral Supplements Chief Marketing Officer Carl Mixon has found the most success with add-ons, upsells, and loyalty rewards.

Beldoch thinks artificial intelligence will become a significant tool for the subscription supplement market in the coming years. For example, at Ordergroove, artificial intelligence signals the brand when a subscriber has overstock on hand, and enables them to proactively reach out to pause an order before the consumer cancels. “Brands that utilize this tool have a higher retention rate and increased consumer lifetime value,” says Beldoch.

If you ask Bushouse, supplement subscription services of the future will only become more sophisticated. “Really, the biggest challenge for any provider is pace of change,” he says. “Consumers will look for deeper personalization, greater product transparency, efficacy, and a more effortless experience from end to end. As technology becomes more sophisticated and consumer needs evolve, we have to work hard every day to evolve with them.”