Royal Mail: This is a great opportunity for businesses of all sizes

Over a quarter (26%) of UK shoppers are currently signed up to a food and drink subscription box service, according to Royal Mail’s new UK Subscription Box Market report.

Food and drink subscription boxes, as well as recipe box subscription services, witnessed the highest growth year-on-year in 2020, as consumers dialled up more home deliveries with supermarkets’ online capacity stretched to the limit.

Consumers were also wooed by subscription boxes’ curated approach to meals with easy instructions, and easy access to alternative and specialist food suppliers. Both markets have a combined value of over £1 billion (up from £420 million in 2017) with this forecast to grow to over £1.5 billion by 2025.

Delivering the essentials

The pandemic and associated lockdowns sharpened consumer focus on subscription businesses as consumers attempted to limit trips outside of the home even for essential items.

The growth in purchasing essential items online has bolstered the subscription box market in the UK. This has been particularly evident in categories such as male grooming, where there is a consistent, predictable need to replace and replenish items, and subscriptions offer a hassle-free alternative to traditional purchasing behaviour. The male grooming subscription market grew 108% between 2017 and 2020 to reach a value of £41.7 million.

Elsewhere, other everyday health and beauty products are also seeing strong growth. This sector has grown from being worth £43 million in 2017 to £79 million in 2020. It is forecast to grow to £92 million by 2025. 11 per cent of UK shoppers are currently signed up to a health and beauty subscription box service.

Due to changes in consumers’ shopping behaviours, and the convenience that these subscription plans provide, the trend of relying on subscription services to attain essential items will likely continue post-pandemic.

Overall, the UK subscription box market is set to be worth £1.8 billion by 2025, according to Royal Mail’s UK Subscription Box Market report.

Nick Landon, Chief Commercial Officer at Royal Mail, said: “The last year has created new spending and shopping habits that have changed the way consumers are interacting with retailers and increased their appetite for subscription boxes. This is a great opportunity for businesses of all sizes to tap into changing consumer interests and provide regular deliveries of goods.

The full UK Subscription Box Market report will be published in the coming months on the Royal Mail Group website.