How to build a successful subscription business

What’s the key to building a successful subscription business? It’s probably the biggest question on your mind if you’re starting one of your own — or even if you’ve been running one for some time. As part of our latest initiative to help new subscription business owners — and all those who may be struggling to grow — we’re interviewing some of the top subscription business owners we work with about how they’ve gotten where they are now, and what advice they may have for others.
In our second interview of this series, we sat down with Ellyette (“Elly”), the Founder and Owner of BootayBag — a monthly subscription for women’s underwear that Elly has grown to more than 40,000 subscribers in just two and a half years.
Q: How did you come up with the concept for BootayBag? Was it your first business venture?
Elly: It’s funny — I had zero business experience before this. I actually went to cosmetology school, same as my mom, and that was my plan for my career. When I moved to Denver two and a half years ago, though, it took some time for my license to transfer over. I had a lot of free time on my hands and was trying to think of something to do in the meantime to make money, but I never imagined I’d start my own business. The inspiration really came from Birchbox. I was a Birchbox subscriber and really liked the idea behind it, but I wasn’t very interested in makeup, so I started researching what other types of subscription boxes were out there. I saw one for underwear, and that seemed like a really cool idea to me — something I would definitely be interested in. I signed up for it, but when I got my first shipment, I was disappointed by a lot of things about it, from the packaging to the quality of the product. The idea was still really appealing to me, though, so I decided to try and do it myself.
Q: Were you nervous about starting a business all on your own without any experience?
Elly: I think that in some ways, it was really great that I knew nothing about running a business at the time, because I just thought, “How hard could it be?” I wasn’t afraid, because I didn’t even really know what I was getting into. I didn’t realize how hard it was going to be and how much work it would take. I just knew I loved my idea and wanted to try and make something of it, even if I didn’t have a lot of money to invest into it. When I first started, I had an awful website I’d built myself and was just selling to my friends on Facebook and Instagram. I was hand-writing shipping labels and taking boxes to the post office. Then about six months in, it was suddenly not just my friends and family buying from me — but more than 100 people — and I realized that this was something that could actually be successful. But I needed to get serious and make some big changes if I wanted to scale.
Q: How did you make your business scalable?
Elly: I had to do a lot of research at first. I looked at all the subscription companies out there that I liked, and I tried to figure out what they were doing and how I could replicate that. The more I read, the more I realized I’d need to make some serious improvements to the website and product.
My website wasn’t very professional, and I’d been using PayPal for recurring payments — neither of which would work in the long term. I decided to move over to Shopify and Recharge. From all the research I’d done, it just seemed like the best option for the kind of company I was building. That alone added so much stability and security to my business. It also gave me a reliable resource for technical support, in addition to the developer I hired to help me build out custom capabilities and the kind of website that I’d wanted.
As for the product, I partnered with a private label wholesaler, which has allowed me to design our products myself, while outsourcing production and shipping.
Q: Has it been pretty steady growth to 45,000 subscribers since you made those changes?
Elly: No, we were actually only at 10,000 last January. That’s when we really started honing in on our demographic and focusing on improving quality. With a product like underwear, people want to have a good idea of what they can expect. As much as they love the surprise factor, they also want to know how it’s going to fit and how it’s going to feel. They want to know the quality of what they’re signing up for is good, without actually being able to get their hands on the product beforehand. That’s why I worked so hard with our wholesaler to improve quality and to get the designs just right — and then I made sure that we got the right photos and shared them with the right target audience.
Q: Tell us more about how you’ve used Instagram to be successful. You’re up to 127,000 followers on there now, aren’t you?
Elly: Instagram has always been extremely important for me. It was one of the first platforms I used to market BootayBag, and it’s probably still the most effective marketing platform for us today. There’s a huge audience on there, and there aren’t a lot of companies successfully selling products to them yet. I also think when I first started BootayBag, it was one of the first companies on Instagram that tried to not be so superficial. There are a lot of people on there who can be really hurtful and make others feel bad about themselves. I decided I wanted our brand to be about making women feel good about themselves and their bodies. That’s why our Instagram feed has always been very body positive and focused on making women feel beautiful — which has really helped us grow our audience.
Q: Since you’re so active on Instagram, is that also how you get customer feedback?
Elly: Instagram is my biggest source of feedback. I personally monitor all our social media accounts and read everyone’s comments. I believe if you’re not listening to your customers, you’ll never improve, and you’ll never grow. I’m also asking questions like what colors and styles people want to see next, whether they like what they’re getting, and if they want to see something new. I honestly don’t even need to ask for feedback. Women are always giving it on Instagram, whether we ask for it or not. Our customers love giving their opinions, so I never really have to wonder what they’re thinking. If they’re tired of seeing black underwear, for example — they’ll say so — and then I’ll make sure to add more colors, and to reply to their comments on Instagram letting them know.
Q: Other than your efforts on Instagram, what do you think has made BootayBag so successful?
Elly: One thing is that I’ve always kept it simple and focused. I started this as a $12 monthly shipment of two pairs of underwear, and it’s still a $12 monthly subscription of two pairs of underwear. I haven’t diluted the brand or created too many options for customers to choose from. Some people have told me that I should add more products to what I do, such as socks, but I’ve stuck to what works and what I like doing. My goal is to really perfect the quality of the product — and then maybe consider how else we want to expand.
Q: Any parting advice on what it takes to build a successful subscription business?
Elly: I think the most important thing is passion — and not being afraid to just go for it. I had no idea whether this was going to turn into something profitable, but I decided to just take a chance on it, because I was passionate about it. I really believe that if you have a good idea and are willing to work at it, people will eventually catch on and give you a chance. You can always learn and make improvements as you go, but if you’re too scared — or if you spend too long trying to perfect your product before you launch — someone might beat you to it. So just go for it.