What’s in the box?

Each month, Cairn customers receive a package slightly smaller than a shoebox at their front doors. They expect to unwrap products related to their love of the outdoors, but what exactly is nestled inside is a mystery.

“It’s an opportunity to have someone else cater a box of content in an industry you’re interested in, and deliver it to your doorstep wrapped as a gift,” Rob Little, the CEO and founder of Cairn — a monthly subscription service for outdoor gear — wrote in an email.

“Many people say it’s like Christmas, once a month.”

Cairn is one of two Bend companies using the subscription box model, a retro trend that is on the rise across the county. Consumers can explore new brands and products, while the companies that make the products get exposure among members of their target market and, in some cases, demographic data and product reviews in return. James Erickson, founder and CEO of StrideBox — a subscription box company offering running products and accessories that recently relocated to Bend — said the subscription model has been successful for decades. “Of course, there are magazines, but also the 1980s brought the popularity of mail order ‘of-the-month’ clubs that offered fruits, food and other things delivered monthly via (cash on delivery), or credit card,” he wrote in an email.

“With the new tools (Internet) that are available now, it has led to a resurgence of the subscription model and specifically the subscription box company.”

Jesse King, an assistant professor of business at Oregon State University-Cascades, said there are a number of reasons behind the growth of the varied types of subscription services.

“Marketers have always been interested in dividing the market into different segments, but the Internet has made it possible for some of these groups to really come together around some types of interests,” King wrote in an email.

“These subscription businesses fit into these communities by providing assortments of products tailored towards their interests.”

With so many choices in the marketplace, he said, decision-making for consumers can be difficult and mentally taxing. Box subscriptions relieve some of the choice-making responsibility by providing bundles of products for consumers, he said.

“This saves the customer time and mental effort but also frees the subscriber from blame if the products do not work out,” he said.

Consumers are also less brand loyal today than they were generations ago, and subscription services offer a variety of different experiences, he said.

Erickson said the subscription model works for runners because of the ongoing nature of the activity.

“They are always looking for a way to go faster, be healthier or enjoy their (runs) more,” he wrote. “This quest usually continues for a long time.”

The parcel, which is about the size of a lunchbox, contains six to eight products and cost $15 per month. Erickson said the sales structure allows StrideBox to deliver different products to its subscribers based on season, weather, training cycle or new releases from companies.

StrideBox has customers in all 50 states, and in Canada. The company shipped its first box to 75 subscribers in February 2013 and is now sending thousands of boxes each month across the continent.

“A lot of our subscribers like the monthly deliveries because it is a little surprise each month, and serves as motivation to see what products inside the box are going to integrate best with their training and running schedule,” he wrote.

King of OSU-Cascades said the business model provides a recurring revenue stream for companies sending out the boxes. Once people sign up, they continue to pay every month even if they are not using the products. It also introduces customers to products they might not otherwise try.

“Once you find a group of customers that are well-suited to your specific box, they probably know other people who also might like the service,” King said. “It is easy to see how these services could snowball in subscriptions from referrals.”

However, it may be difficult for some companies to acquire the right customer and keep that customer, he said.

“As some of these services become more niche, the assortments of products might become too specific for some customers,” he wrote. “Keeping customers delighted with the assortment of products they receive could be an ongoing challenge for these businesses. … As soon as the boxes deliver products that customers do not like, or even worse — if they repeatedly deliver the same products that people do not like, customers may defect and never come back.”

And as new firms enter the market there will be more competition, which can make it more difficult to both stand out and to deliver a mix of products that service a broad enough portion of the market to remain profitable.

Little of Cairn agreed the business model has challenges. For example, in the outdoor industry, he said, the subscription-box model is a new concept.

“While some people are familiar with it and come looking for us, we still spend time educating both consumers and brands on what we’re doing,” he wrote in an email.

“Your typical consumer isn’t out looking for us in the same way that they’re looking for a new sleeping bag or a new thermos. That means we have to be creative about how to get in front of them and show them what we’re offering.”

But being new also means there’s plenty of room in the market. Cairn was selected in September to participate in the concept-stage competition of the Bend Venture Conference for a chance to win $10,000.

And in July, Bend Outdoor Worx, a new business incubator for companies in the outdoor industry, chose Cairn for its first mentorship program.

Little said Cairn’s boxes appeal to the entire outdoor industry, instead of just a segment, such as golfers or fishermen, which makes the company unique.

It’s also investing in data collection and gives its subscribers incentive to provide that data so companies with products in the box get insight to their products.

Over time, Little plans to use profile settings to customize the content of the box and provide more personalized products. Cairn generates revenue from subscriptions. Once a month his garage turns into a production line to package the boxes and get them ready to ship to subscribers. Boxes cost consumers $25 a month and include four to five products such as gear, apparel, nutritional goods and skin care products. The company ships to 42 of the 50 states.

Little expects to open an online store to drive follow-up sales. He also is exploring creating quarterly boxes with higher-priced items, as well as including travel giveaways for subscribers.

“It’s a lot of fun to teach people who love the outdoors that a service they’ve seen for years in other industries is available in an industry they love — the outdoor industry,” he said.

— Reporter: 541-617-7818,

rrees@bendbulletin.com