I check in on Katia Beauchamp and Haley Barna of Birchbox pretty regularly—I think the last time we really sat down was at this spring’s ForbesWoman conference and Beauchamp was helping me to blot my face before a video interview (Not my finest moment.)—but the cofounders are notoriously tight lipped on both growth metrics and momentum. Until recently it seemed like the only number they’d let slip was the count of boxes they’d shipped, which was ever mounting. Today it's five million.
But user count? Not gonna say. Revenue? Forget about it.
So when the Birchbox camp reached out to put numbers to what they see as the hard-won success of the past 12 months, I was quick to put the phonecall on my calendar. Beauchamp, on the line, apologized—kind of. “We’ve just been so focused on the product we didn’t even think about talking to the press about details,” she demurred.
What she wants to talk about now is conversion. Specifically the conversion of 400,000 subscribers to Birchbox, the monthly mailing of sample-sized products, into regular customers on the site’s shop, where full-sized versions of the sample products can be had. “The conversion is a really important part of showing to both the brands we work with and everyone else the power of the subscription service model,” she told me this week.
The Birchbox vision from the get-go was pretty solid: users would benefit from trying out products that were either too obscure or too expensive in their full-size iterations to be tried by the average consumer. Beauchamp says that they knew even back in 2010 that all of that sampling would go somewhere—and eventually result in high end e-commerce sales through the site. “The value proposition has always been clear from start to finish,” she said. “The end to end experience of trying—and then buying.”
Today she says that 50% of all subscribers are making regular full size purchases on the site and that—a surprise they hadn’t anticipated—they’re not the only ones making transactions on the site. According to Birchbox stats, 15% of all ecommerce orders come from non-subscribers, which Beauchamp says is a testament to the educational content on the site as well as Birchbox-exclusive products. (And, of course, a great SEO strategy, although she won’t say).
This conversion to full size purchases is—among other things like, say, being the first player in what’s become the crowded space of subscription-commerce—what’s really setting Birchbox above and beyond its many (and oh-so-varied) copycats. The PetBox, the baby box, food boxes, wine boxes, even period boxes—all send great products in a box but stop there.
It’s good for Birchbox, but it might even be better for the brands it carries. Beauty brands (or as they’ve expanded into men’s boxes, accessory brands etc.) supply Birchbox with free samples to send out to subscribers in the hopes they’ll see a purchase down the road. For them, it’s a marketing cost but a cost nonetheless. According to Beauchamp, they’re starting to be very, very pleased.
Take Stila, which started working with Birchbox in 2010. After Stile samples were sent to just 7% of subscribers based on their beauty profiles, one eyeshadow palette saw an 11.2% conversion rate into a full sized purchase, something Beauchamp says is more than 10x the industry standard.
“That’s a consistent storyline from our brands,” she says, which has reached a count of 500. “The brands give us their samples because the recognize the value of our ability to get consumers to think about their product and to try it,” she says, “But also to be able to measure the impact of the investment [as Stila has].” In that way, she says, Birchbox is marketing, media, analytics and retailer all rolled into one.
She still won't talk revenues, but a girl can dream.
