This document discusses subscription commerce businesses and provides advice for starting and running one. Some key points: - Subscription commerce businesses involve recurring shipments of items like clothing to members on a regular schedule, aiming to save customers time and money. - Reasons to start one include the ability to gain 100k+ members, earn 50%+ margins, and recoup acquisition costs quickly through recurring revenue. - Infrastructure considerations include payment processors, content management systems, and third-party logistics providers. - Fulfillment and shipping are critical, as customer happiness declines rapidly with delays. Marketing through email, retargeting, SEO and community engagement are emphasized. - Upsells and deals can supplement

1. Subscription Commerce
Sean Percival
Co-Founder Wittlebee
sean@wittlebee.com - @percival

2. About Wittlebee
• The kids clothing club
• Members get 6 items for $39.99
• 50/50 we pick vs. members pick
• Try to provide $100 of retail
value
• Goal: Save parents time and
money while reducing mall
meltdowns
Last Year
• Launched in Feb 2012
• 8000+ members peak in 2012
• $1.4MM in bookings for 2012

3. A few reasons to start a subcom business:
• You can realistically see 100K people signing up
• You can get 50%+ margin from day 1
• You know something about online marketing
• You can recoup any acquisition cost by month 2 or 3
• Can you sustain members for xx+ months on average

4. A few reasons not to start a subcom
business:
• You think it’s easy (no ecommerce is)
• You think funding is widely available
• You think it would be fun to pack all those boxes
• You’re thin skinned

5. Subcom for Parents Landscape
Deadpool
(Merged with Kiwicrate)
$0-$150K $200K-$500K $1MM+
Monthly Bookings (estimated)
2012 Funding: $42MM
2013 Funding: $0

6. Infrastructure
Payment Processor
• Recurly
• Chargify
• Stripe
CMS/Admin
• Custom & Python
• Avoid PHP/Ruby
• Avoid Magento
3PL
• API Based
• $2-$3 per order
• Start Local

7. Fulfillment
Your customer’s happiness over time due to shipping delays.
2-3 Days 1 Week 2 Weeks 4+ Weeks
Happiness
Thrilled
Excitement
Concerned
Frustration
Agony
Defeat
You Ruined Xmas
Suspicious
Anger

8. Marketing Channels
(friend get friend)
(gift with purchase or discount)
Best performance over time
Channels That Suck:
• Google Adwords
• Twitter
• Radio/Pandora
Secret Tricks:
• Sway Group
• Box Inserts
• Think CPL over CPA

9. Marketing
-Kick ass at Email Marketing
-Retargeting is dialed in
-Invested in SEO
-Strong community
• Annoyingly social
• Riding press hits
• Growing but slowly
• Lack paid marketing talent
• Need top talent/agencies
• Costly to maintain
• Dependent on funding
• Scaling paid is HARD
Organic (Too Cold) Paid (Too Hot) The Hybrid (Just Right)

10. Upsells
Instagram SalesWeekly Deals

11. What’s next for subscription commerce?

12. Thank you