According to the Q2 2017 Kantar Futures U.S. Monitor, 67% of Millennials reported that brands play an important role in society and are responsible for making it better. The same survey also revealed that 67% of respondents change their shopping habits based on the social standing of the brand. Boxed recognized early on the importance of having an authentic purpose behind the brand and it has struck a chord with shoppers by promoting social equality in both its internal employee teams, as well as in a variety of campaigns.
Founded in 2013 and seen as the “Costco for Millennials,” Boxed can thank, in part, this key demographic for its quick growth. According to CNBC, over 80% of its shoppers are between 25 and 44 – a range only several years above the average millennial. In 2017, year-over-year sales doubled to $100 million. While its different business model and digitally-native approaches are both key, one can argue that it is its socially conscious mindset has struck a chord with Millennials.
Acting on his vision for social equality, Boxed CEO Chieh Huang has set aside half of his stock to personally pay for employees’ children’s college education. Huang also extended his offer to contribute to any “life-changing events,” including paying for employee weddings and offering unlimited parental leave.
And the Boxed purpose around social equality also extends to shoppers. In its Rethink Pink campaign, Boxed took a strong stand against the “pink tax,” in which many women-specific products are claimed to be noticeably more expensive than men’s products. In addition, Boxed strategically lowered the prices of feminine hygiene products such as tampons, to reflect an adjusted final price, once they are taxed as luxury goods. Directly tailored to Boxed’s target demographic of Millennial moms, the campaign cut into the bottom line, yet earned the retailer great praise from shoppers.
Increasingly, shoppers are looking to retailers to be purpose-led and reflective of their core beliefs. In 2017, 56% of household shoppers said they would be willing to spend a little more for a product that reflects their values, according to the Kantar Futures survey. Shoppers are looking for authenticity and strong social stance, and Boxed, though both its retail and employee campaigns, delivers on its purpose.
What does this mean for retail?
- As online shopping grows, millennial families are a key target segment of eCommerce platforms. Brands selling online need to understand the different drivers for millennial shoppers and how their products can capture that market.
- Shoppers are increasingly using their wallets to vote for the change they want to see. Manufacturers need to be aware of shoppers influence on retailer decisions and align the offer accordingly.
- According to Boxed, its customer-base is largely female, and its “Rethink Pink” campaign shows they are targeting this segment. Feminine products on Boxed are given the added advantage of having their price dropped to negate the “Pink Tax” they will face at other retailers.
For more information, please contact:
Kevin McCoy, Analyst