Before Nick Chen helped start his hospitality subscription box company, ‘Welcome, he and his business partner took a trip with some friends. They stayed at a nice Airbnb apartment in San Diego in a luxury high-rise with four people staying in a four-bedroom, two-bath condo. Everything was great, he says, except there was one bar of soap in each shower. And that was essentially all they had.
After that trip, they thought that there was a much better way to provide a great experience to guests staying at short-term and even medium or long-term rentals. That was the origination of the idea. Then the work began. For three to six months, they thought of ways they could tackle that challenge. They created a prototype, communicated with different brands, and ultimately landed on their concept, which Chen told PYMNTS in an interview is “a subscription-based hospitality box.”
The company sells the boxes to hosts, apartment property managers and owners who can gift them to guests upon arrival. It contains high-end bathroom and beauty amenities as well as snacks — healthy, sweet, savory — that guests can enjoy when they arrive at a unit. There is also a customized welcome note with information about a property, including Wi-Fi, house rules, checkout time and emergency contact information. To buy a box, hosts or companies can visit the company’s website.
They can select a plan that makes the most sense for them. The site also has a calculator to help determine how many regular-size boxes and mini-boxes, which are meant for each additional bathroom, are needed. Buyers can opt for a one-time purchase or a subscription where the right number of boxes get delivered to them every single month. Users can fill out a couple of fields and, once the customized piece gets sent to them, the company will go ahead and produce the boxes. The company accepts credit cards through Shopify and Recharge.
Chen says the company spends a lot of time on the curation aspect and, generally, “we’ll curate by the season.” The box contents will change, although the company will keep some items constant in the box throughout the year. With wintertime approaching, the company is now focusing on winter flavors and heartier snacks like cinnamon spice chocolate. Its also doing PopChip potato chips and Kind protein bars. And the beauty piece — bathroom amenities — gets the same kind of seasonal adjustment. The company works with larger brands like Kind bar, but it is mostly partnering with up-and-coming independent brands that want to get in front of customers.
The company is “a great product discovery platform,” Chen said, adding that is especially the case as it has a good sense of who will ultimately enjoy the box. That market is affluent travelers — people who are willing to try new things usually — and pretty much within the 35 to 45 age demographic, fairly evenly split between men and women. When it comes to the company’s customers, Chen notes that enterprise business-to-business (B2B) customers — property managers — are roughly 80 percent of its business.
The company has its items delivered nationwide and always prefers to ship by pallet — another reason why enterprise clients are a bit better for it. A lot of them have centralized distribution centers, and the company can ship a pallet full of boxes to a centralized spot to be distributed. For marketing, the company directly reaches out on the enterprise client side. On the individual side, it taps into digital marketing and social media. It focuses on properties that charge $130 a night and higher. Those can afford to purchase the box. They also have the type of customers who would appreciate as well as use the items in the box.
Chen says it’s perfect for a traveler who is spending a couple of nights in a nicer Airbnb versus eight people staying in a two-bedroom apartment for one night. Studies show that when people open something upon arriving, Chen says, they are much more likely to enjoy the stay and overlook any problems that may come to pass. “It buys a lot of goodwill” with the guest, he said. Their hosts also don’t have to worry about shampoos or snacks form an inventory control standpoint if they are providing a self-enclosed box that has everything.
Through boxes that provide convenience to hosts or property managers and gifts for guests, hospitality innovators are tapping into the subscription business model to bring amenities to the homeshare market.