Subscription E-Commerce Market: Current Analysis and Forecast 2021-2027

Global Subscription E-commerce market was valued at US$ 34.7 billion in 2020 and is anticipated to reach US$ 2,643.6 billion by 2028 displaying explosive CAGR of 72.9% over the forecast period (2021-2028). Subscription e-commerce industry has evolved over the past few years. Ever since its inception, the sector has experienced tremendous growth and popularity and have become increasingly competitive. Considering the subscription-based services, the idea is mainly based on selling product or service on monthly or yearly recurring basis. The business model mainly aims to focus on customer retention over customer acquisition wherein revenue is made in a way that the existing or a regular customer pays multiple payments to have prolonged access to a good or service. According to the survey, it has been estimated that in 2018, subscription-based company websites had about 776 million visitors globally. With approximately 5.7 million customers subscribing the service be it entertainment, food & beverage, healthcare and others. In addition, with over 2,000 subscription-based service providers, the market is gearing up with a purpose to cater to the growing young population across all the domains.
With the consistent and surging world as well as young population paired with simultaneous increase in the disposable income along with changing lifestyles the demand for subscription-based services is expected to take a toll in years to come. Moreover, surging penetration of internet services and launch of various mobile applications by subscription-based companies has further catalysed the market potential of such services. It has been observed that subscription-based service constitutes to be a small trend within e-commerce and is expected to remain niche for next few years. With the prime location being United States comprising of almost 70% of the subscription-based companies, the market has driven considerably on a positive note. In addition, led by numerous start-ups ranging from Dollar Shave Club, Blue Apron meal kits, subscription e-commerce industry is growing at a fast pace and has become an innovative way of buying online. Subscription based services are targeted towards younger and affluent urbanites who demand convenient, personalized product and services often at a lower cost as per their needs and specifications.
Fuelled by growing investments by venture capitalists and emerging start-ups, business has been launched in wide range of categories such as beer and wine, kids and baby items, cosmetics, feminine products, pet foods, women and men apparel and health items among others. However, high churn rates and huge cancellation rate by consumers along with lack of awareness among the developing nations constitute as some of the obstacles in the growth path of subscription e-commerce market. Strong growth in subscription e-commerce market has attracted various established consumer brand manufacturers and retailers, which have also entered the space; P&G (Gillette on Demand), Sephora (Play!), and Walmart (Beauty Box) have all launched new subscription businesses to name a few.
"Subscription services subscribed by Women is expected to dominate subscription e-commerce market during the analyzed period."
Global subscription e-commerce market is segmented based on end users such as women and men and kids. The women as end users occupy largest share and is expected to maintain its dominance throughout the forecasted period 2021-2028. Owing to increasing presence of startups catering to feminine products and cosmetics along with jewellery and accessories, market has boosted considerably.
"Amongst applications, beauty and personal care tends to conquer the market during the forecast period."
The study further bifurcates the subscription e-commerce market into different applications including, beauty and personal care, clothing and fashion, entertainment, health and fitness, food and beverage and other applications. Beauty and personal care hold the largest share in global subscription e-commerce market. As beauty and personal care application has already experienced explosive growth among young and new brands, it is also witnessing spurring preferences for subscription among the women folk.
"North America 65.5% share dominates the market in terms of revenue sales for subscription-based products"
For a deep dive analysis of the industry, the study also includes regional and country level analysis. The report comprises regions including North America, Europe, Asia Pacific and rest of world. North America dominated the market, majorly driven by widespread adoption of subscription-based services in the United States and numerous emerging players earmarking their footprint in respective domain. Furthermore, changing lifestyle and busy work schedules around the globe also act as influencing factors fostering the industry growth.
"Online Payments held the prime market share in terms of payment mode for subscription e-commerce market."
Based on payment mode, market is classified into cash on delivery and online payments. Given the government initiative to promote the cashless economy and digitization, online mode of payment is expected to continue its prominence during the forecast period.
Competitive Landscape-Top 10 Market Players
Some of the major players operating in the subscription e-commerce market include Dollar Shave Club, Inc., Blue Apron Holding Inc, Personalized Beauty Discovery, Inc. (Ipsy), Hello Fresh, EdgeWell Personal Care (Harry's), PetSmart, Inc., Netflix, Flintobox, Nature Delivered Ltd (Graze) and The Walt Disney Company. With an objective to enhance their product portfolio, these players have adopted various strategies to increase the penetration of subscription-based services in various domains among the young population owing to changing lifestyles and increasing disposable income.
Reasons to buy (The research report presents):
- Current and future market size from 2021 to 2028 in terms of Volume and value (US$)
- Combined analysis of deep dive secondary research and input from primary research through Key Opinion Leaders of the industry
- Exhaustive analysis on working model, regulative scenario and value chain analysis
- A quick review of overall industry performance at one glance
- An In-depth analysis of key industry players
- A detailed analysis of regulatory framework, drivers, restraints, key trends and opportunities prevailing in the industry
- Examination of industry attractiveness with the help of Porter's Five Forces analysis
- The study comprehensively covers the market across different segments and sub segments
- Region Covered: North America, Europe, Asia-Pacific and Rest of World
Customization Options:
UMI understands that you may have your own business need, hence we also provide fully customized solutions to clients. The global subscription e-commerce market can be customized to regional/country level or any other market segment.

The major focus areas considered while analyzing and defining the penetration of subscription e-commerce includes application segment (beauty and personal care, food and beverage, clothing and fashion, healthcare and fitness and entertainment), end-user segment (women, men and kids) and payment mode segment (online and offline). In 2018, the beauty and personal care application dominated the global subscription e-commerce market with the maximum share of 29.6% in terms of value. Growing demand for glam, convenience as well as number of players flocking themselves into beauty arena would help the segment to grow at a faster rate of 84.3% during the forecast period (2019-2028). However, with the strengthening e-commerce and surging trend of online shopping, other areas such as clothing and fashion, food and beverage, healthcare and fitness and entertainment are also anticipated to register highest CAGR over the forecast period.
Subscription boxes or subscription-based business model refers to a recurring delivery of products as part of a?marketing strategy?and a method of product distribution. With a target to cater to wide range of customers portfolio with their specific needs and specifications, it is estimated to continue its double-digit growth in years to come. It has been further estimated that that there are 400 to 600 different kinds of subscription boxes in the United States alone and more overseas. They aim to facilitate the consumers with an easy, personalized and cheap way to purchase their products as per their requirements. Moreover, increased exposure to new products in different applications ranging from beauty and apparel to toys, books and pet food has significantly supported huge consumer base to discover optimal products for their preferences and needs. Although being at nascent stage as well as being a niche segment of e-commerce domain, it is anticipated to capture sizeable chunk of e-commerce market.
Subscription e-commerce business has been booming owing to several factors apart from convenience and cost efficiency. It has been observed that more than 12% of the existing online shoppers have signed up for one or more subscription services. Modern lifestyles and changing consumer behavior, as well as accelerating disposable income and the assurance to deliver quality services thereby leading to positive user experience has tremendously flourished the market potential in recent years.
Moreover, proliferation of internet services and smartphone penetration coupled with augmenting working population has substantially catalyzed the market performance of subscription business across the globe Considerable rise in venture capital investments along with surging number of visits has proliferated the industry growth. Furthermore, as the subscription-based business models have become a part of everyday life for consumers, curation-based subscription boxes comprising clothes, beauty products are the most popular kind of subscriptions. Curation boxes purpose to surprise the consumer with individualized experiences in diverse categories such as food, apparel, beauty and others. To add on, surging technological advancements and burgeoning demands for online shopping, software applications and providers have also enabled the consumers to delay, modify, scale up or scale down their subscription orders. However, overbuying issues, privacy and security concerns, unclear value, unclear return policies tend to hinder the market growth.
Moreover, in 2020, women subscribers held a prominent share of 54.6%, followed by men and kids' subscribers. The women subscription e-commerce market at global scale was valued at US$ 18,949.4 million in 2020 and is projected to witness astonishing CAGR of 70.8% during the forecast period. In addition, men subscribers held around 31% market share in the respective market on account of surging demand of products such as razors, shaving creams and other men grooming products over the years. Hence, the segment garnered revenue of US$ 10,750 million in 2020. While online mode of payment captured the lead share of 69.6% during 2020 attributed to surging government initiatives in terms of cashless economy and rapid digitization.
To conclude, subscription e-commerce business has been growing at a very accelerating pace due to growing number of consumers signing up for various subscription services. It has been observed that the market size as well adoption rates are reaching all-time highs. Ranging from beauty products to health care and fitness subscription kits to pet food, the subscription-based services aim to offer end to end solutions to the end users. Global Subscription e-commerce market generated revenue of US$ 34,713 million in 2020 and is expected to reach US$ 2,6453,580 million by 2028 experiencing robust CAGR of 72.9% over the forecast period (2021-2028).
Also, for better understanding of subscription e-commerce market, detailed analysis has been conducted for different regions along with their countries including North America (US), Europe (UK, France, Nordics), Asia Pacific (China, India, Japan), and rest of the world. The Rest of world includes regions such as Latin America and Middle East. Based on the estimation, North America dominated the global subscription e-commerce market, accounting for revenue share of 65.5% in 2020. On account of majority of subscription-based companies being in North America and huge awareness among the developed countries such as United States about the subscription-based services has significantly fostered the regional market.
Numerous companies have earmarked their presence in the global subscription e-commerce market and continue to focus on business expansions, product expansions, surging investments and collaborations, for instance, Ipsy, Birchbox, Dollar Shave Club, Stitch Fix, Hello Fresh, Blue Apron to name a few. They continue to offer wide range of subscription boxes that cater to consumer needs and specifications in various domains that further resulted in escalating visits on subscription websites. Furthermore, emergence of various startups in beauty and personal care, healthcare and fitness domain along with growing demand for creative subscription boxes for kids has further influenced the market growth. With an objective to stimulate the signups for subscription boxes across the developing nations and developed nations, these players have adopted various strategies to enhance the penetration of such business model. Some of the major players operating in the global subscription e-commerce market include Dollar Shave Club, Inc., Blue Apron Holding Inc, Personalized Beauty Discovery, Inc. (Ipsy), Hello Fresh, EdgeWell Personal Care (Harry's), PetSmart, Inc., Netflix, Flintobox, Nature Delivered Ltd (Graze) and The Walt Disney Company.