FabFitFun in the US strengthens e-commerce as online revenue grows 50% and attracts 2 million users

Recently, FabFitFun, based in Los Angeles , said that its revenue increased by 200% to US$600 million in 2020. Currently, the company has 2 million members and has become one of the leading subscription box player providers in the United States.

FabFitFun in the United States recently launched a new membership campaign, starting with the summer box, to provide members with customized services. Members need to pay $50 per box per quarter (or prepay $180 for all four boxes in a year) to get full-size products worth $300 to $400 from more than 1,000 different brands.

FabFitFun said it initially began testing the level of customization by offering slight variations on the products included in the box, for example, letting customers choose between colors in hopes of selecting the products they like best. FabFitFun also offered a deposit on pre-selected items, but customers were unable to return them because they were offering them below cost.

When receiving the package, some members said that it was really exciting and felt like a great gift to themselves. The ability to make such bundling and customized technology investments on a large scale is enough to show the success of FabFitFun's strategy.

Its e-commerce division has seen revenue grow 50% year-over-year, and subscribers have doubled, as more subscribers come to the site to make purchases between deliveries, often at special sale prices. The company's data shows that most of its sales come from those recurring subscriptions, but it also generates revenue from running sponsored content on its site and from subscribers purchasing online.

Additionally, FabFitFun on Tuesday also launched a "credit swap" feature, which allows members to give away seasonal boxes in exchange for credit to be used to purchase products on its website during the company's seasonal sales. Both annual and seasonal members will have unlimited swaps.

FabFitFun's peers, like Hunt A Killer, nearly doubled their revenue to $50 million last year. Stitch Fix, which offers clothing subscription boxes , had revenue of $1.7 billion in 2020 and a market value of $5.6 billion. The company said sales rose 11% in the six months ended Jan. 30, 2021, and its stock fell more than 20%.

As the COVID-19 pandemic eases and consumers spend less time at home, online shopping has become increasingly popular, especially for household items. FabFitFun said it will evolve the concept of shopping membership and adjust the categories it operates to welcome more online shoppers.

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