Understanding Customer Participation Dynamics: The Case of the Subscription Box

Abstract

Although subscription boxes are incredibly popular, box companies often miss out on the benefits of a subscription model. Customers routinely skip boxes, and even when they do not, they often return products from each box. Hoping to avoid these returns, box companies ask customers to preview upcoming boxes, evaluate delivered boxes, and justify skipped boxes. The authors are interested in how such extensive customer participation can discourage skipping or, even better, encourage spending. An analysis of 30,000 apparel box customers’ repeated preview, feedback, and purchase behavior reveals that, in addition to whether customers participate, the way in which and when they participate matter, and often in counterproductive ways. Specifically, customer participation with the delivered box drives future purchases, whereas participation before and after the delivered box appears to decrease box opt-in and spending. Further, the double-edged nature of customer participation, especially when such participation involves emotionality, has long-lasting effects, indicating the important role of customer participation dynamics in shaping purchase behavior.