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Case Details

Case Code: BSTR533
Case Length: 7 Pages 
Period: 2010-2017 
Pub Date: 2018
Teaching Note:Available
Price:Rs.200
Organization :Birchbox Inc.
Industry :Beauty and Personal care, e-commerce
Countries : USA
Themes: 
Case Studies  
Business Strategy
Marketing
Finance
Human Resource Management
IT and Systems
Operations
Economics
Leadership & Entrepreneurship

Birchbox (B)

 

ABSTRACT

 
The case continues from the second round of lay-offs followed by a round of funding which gave breathing room for the cash-strapped start-up. Beauchamp tweaked the loyalty program but the move was not well received by its subscribers. Birchbox also launched a new service called Birchbox Select which gave the subscribers more choices and control to customize their Birchbox for an extra fee of $5. In April 2017 Birchbox announced it had turned profitable because of all the cost-cutting measures it had adopted and maintained that profitability had also come with growth. Birchbox went on to sign strategic partnerships with beauty brands and Vogue, a lifestyle magazine. Case (B) concludes with challenges that Birchbox could face with the entry of well-established e-commerce platforms with a high degree of vertical integration, into the beauty subscription space.

 
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Issues

The case is structured to achieve the following teaching objectives:
  • Examine Birchbox’s business model and identify the key challenges pertaining to its model which limit the growth of the company..
  • Evaluate the competitive environment of the industry in which Birchbox is operating.
  • Inspect and critically evaluate the measures taken my Birchbox in the wake of the challenges it is facing.
  • Estimate the threats Birchbox might face in the immediate future. Analyze and devise a plan for counter measures.
Contents
INTRODUCTION
TWEAK IN LOYALTY PROGRAM
BIRCHBOX SELECT
STRATEGIC PARTNERSHIPS AND NEW STORES
EXHIBITS

Keywords

Birchbox,Beauty and personal care,Subscription model,Discovery retailing,Business model,Startup,Copycat businesses,Mass customization,Loyalty programs,Competition,Low entry barriers

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