Unboxing Care/Of — Competition Research {Million Dollar Idea Project}

As I’ve said many times before: competition is not just one dimension of business, competition is business. I’m keeping a close eye on my competition, secret-shopping, and learning everything I can.

Last time, I secret-shopped PillPack, and this time, I’m scoping out Care/Of, a venture-backed supplement subscription service that raised nearly 17M to support a distributed team in New York, New Jersey, Vermont, and California.

I ordered a handful of supplements from Care/Of on March 7th, and it didn’t end up arriving until March 27th. That’s a nearly 3-week turnaround time, which is, quite frankly, embarrassing.

About two weeks in, they did email me to explain that they failed to anticipate demand and get adequate supply to deliver my supplements on time. They gave me a 15% discount, which is a far-cry from acceptable customer service.

First off, the packaging that arrives is custom-printed on the outside. This is somewhat costly, but I think it’s a nice touch, and I think it has the added benefit of serving as an IRL advertisement for anybody who sees the package along the way. I always notice the stacks of Blue Apron boxes being offloaded in New York every day, and I’m sure that helps.

It’s also got a fun snarky attitude with its “Take it personally” phrase. Lightening the mood is a pretty great way to connect with your customers.

As we open the box, we are greeted with a personalized packet, which appears to be printed on fairly heavy laser stock:

Inside the packet, we are given information about all the different supplements we’ve ordered, including the Supplement Facts that I thought were required, but were missing from PillPack.

There is a heavier printed card-stock instructions packet beneath that, which interestingly shows us that there are two different types of packets, a child-resistant one for packs containing iron, and a normal one for packs not containing iron.

As we remove this packet, we get to the dispenser box, which is neatly nestled inside the cardboard box, which was clearly custom-designed for exactly this purpose.

The first thing I noticed is how severely large the packet is compared to my expectations. The packs themselves are quite large. They’re also customized with the fake name I used for the order. It also includes a lot number and manufacturer date, as well as a nice quote to shake things up.

The backs of the packets are clear, and they have just a tiny tear notch on one side.

The tablets themselves come in a variety of shapes and sizes, and are somewhat distasteful. They match the images on the front of the welcome packet.

Conclusions

Care/Of is clearly facing some scaling issues. They were founded in 2016, and closed their most recent round (for 82% of their total funding) in August. Given the amount of advertising I’ve seen for them, I’d wager a guess that a lot of the funding was earmarked for demand generation, rather than operational support, and that shows in the extreme delays I experienced.

At the end of the day, cost to acquire a customer is going to be high for this product, so the way you win is to be profitable in the long-haul. And the best way to do that is to keep your customers happy for as long as possible. Failing to get me my product in a reasonable amount of time is a sure-fire way to maximize churn, which essentially means the marketing budget was just burned. Assuming they are not first-sale profitable, that ultimately ends up being a loss for them.

If they are first-sale profitable, on the other hand, that’s a great sign for Alphawave. Considering their fundraising history, it’s possible they were able to raise that money on a proven sure-fire formula for success. On the other hand, it could have been raised on the promise of scale, and they’re open to losses to get market penetration.

Again though, it’s all for nought if your customers are churning because they’re unhappy. They go pretty far with personalization, and embodying a fun, almost gleeful attitude.

The size of the packaging threw me for a loop. It certainly feels too large for the amount of pills I ordered, but that’s perhaps because other people are ordering a lot more. I know mine is too small, but theirs is too big.

This also leads me to conclude that I may need to simplify the offering I had in mind. I had originally been considering night and day supplements, and the way this is dispensed doesn’t really lend itself to that. I think that offering something more akin to what they do, with homogenous daily packaging, not only simplifies the operational costs of packaging, but also simplifies the process for the end-user, which will result in improved compliance.

Given that we will not be able to match their custom printing capacity, it’s going to be important to find a way to match the fun, personalized attitude in other ways.

They also have an App, which I’ll be doing a tear-down of in a future article.