Candy Japan 2013 Year in Review

After the initial Hacker News post in 2011 there were around 100 paying members. End of that year 257 members. Now in 2013 we grew from 310 subscribers in the beginning of 2013 to 426 at the end. Christmas gave a bigger boost than expected, December being the best month ever to date. Many people bought gift subscriptions, even though there was no Christmas promotion. 

Wired contacted me, telling me they were going to mention the site on their website. I got very excited about the prospect, imagining the thousands of paying customers that would surely be hitting my site any moment. It turned out to be just a half-hidden mention in some sub-blog of theirs and brought no customers. Actually even worse, it was one of the last slides in one of those "click here to see next slide" style picture posts that everyone hates. Yet another day someone completely out of the blue included a mention to the club above the fold in a popular BuzzFeed post. Around 30 people subscribed just from that. 

A passive income source is just as passive as you want it to be. You can always spend all your time trying to improve things if you choose to. When you choose not to, you risk being eaten by competition or missing growth opportunities. This has certainly happened to a degree. But what good is a "passive" source if you don't take advantage of the freedom sometimes? 

So with this in mind, in 2013 I took some time off for personal pursuits (writing a Master's thesis, passing Japanese JLPT2 and some other licenses) instead of focusing 100% of my time running the site. Not that Candy Japan is even truly passive income anyway, as I do spend a bunch of time each month researching products and dealing with the shipments / customer support, but still I can get away with quite low hours spent if I really want to.

Tried using a proper box with more volume instead of just an envelope. The experiment was a success in that I found a supplier for the boxes and managed to do test shipments using them. Turns out that material and work costs for them are quite a bit higher, as it takes more time to put them together. In a customer survey 87% chose they "loved" that shipment, which is the highest happiness so far. Whether to continue using them instead of envelopes will still require some more thinking. Perhaps a physical A/B test where half of the subscribers are sent a different type of package and compare retention (yes, I tend to overthink things). I fear throwing money away for a benefit that only exists in my head.

In 2013 the price was changed from $23.90 to $25.00, with old subscribers grandfathered in to the original price (GRANDPA coupon to get the old price). It seems to have had no difference to signups, however did not do a proper test here. Obviously this being a physical product, the impact to margin is huge from this extra dollar and gives more breathing room to play with different ideas.

Had the idea to focus each month on a different Japanese prefecture since there are 47 different ones. I could make the club more educational by featuring information, pictures and the mascot of each of them. It was not so simple to arrange though, as apparently many of the products can only be sold inside those prefectures. I learned that not any supermarket can just order any product at will, but that there are regional and other limitations. I would probably need to travel in person to each prefecture and do shipping from those places myself. Which does sound like an adventure.

Same contents going to all subscribers on the same day reduces effort. Instead of small shipping tasks spread all over the month, there is one intense 20 hour period of activity twice monthly. Hiring someone to help me half an hour each day would be more difficult than having helping hands for a longer time twice a month. Less obvious benefits include being able to print all shipping labels in one shot and getting special treatment from the post office as the shipment size is large that day. Having just one receipt for shipping even reduces bookkeeping work.

So perfect, right? Well, it's not perfect for the customers unfortunately. When someone subscribes, it can take up to 15 days before the next shipment day comes around. Then on top of that international shipping takes time, too. It can take over a month to receive the first item after joining, which understandably creates tension as customers start to question their decision to subscribe and whether they will actually eventually receive something in the mail.

For this reason I am thinking of setting up some "welcome envelope" that would be sent ASAP when a new member joins. The details for this are still open though. The biggest one being that if someone subscribes just for one month, I would end up sending them this welcome envelope in addition to the two regularly scheduled ones. This would possibly negate any profit from such customers, but it could be worth it if it means I can retain more customers that end up subscribing for a longer time if I manage to make them happier from the start. 

There are tons of things I want to try and hopefully one year later I can post with some more results. If you have ideas, questions or feedback, please contact me bemmu@candyjapan.com.

Thanks to Dinoangelov, makerops, dbarrett and Brucem (check out Open Dylan, he is a big contributor) for feedback.