SUBSCRIPTION ECONOMYDISRUPTING THE TRADITIONAL BUSINESS MODEL

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IULIAN PĂDURARIU

“It’s about a move from ownership to ACCESS,

from transactional to RELATIONAL.”

RobbieKellmanBaxter,authorofTheMembershipEconomy

In a post-recession, tech-driven world, companies find a way to play into our need to save time and money

In many cases, a subscription is cheaper than buying a product outright and more customizable to our wants and needs

WHAT ECONOMISTS SAY:

Due to the ever-increasing availability of products, the need for instant gratification is growing.

Consumers are now accustomed to receive instant access to a product or service they require, such as countless songs through online streaming services.

The actual interaction with the product or service activates the reward system in the brain controlled by the neurotransmitter, dopamine.

WHAT PSYCHOLOGISTS SAY:

SUBSCRIPTIONS

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• eliminate large upfront costs

• enable consumers to try or experiment a wide array of products and services

• save time to customers

• eliminate friction on repeat business

KEY FINDINGSZUORA STUDY IN UK

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A NATION OF SUBSCRIBERS• Four in five people across the UK

have at least one subscription service.

• Subscriptions are increasingly popular in other aspects of consumer life, including gaming, dining, transportation and retail

80%

A MILLENNIAL SHIFT• 76% of younger consumers

(16-24) have subscriptions,

• a significant importance on the convenience of not having to regularly buy products

• have instant access to what they need.

76%

EXPERIENCES OVER OWNERSHIP

it’s important that they can upgrade and renew the products they use

it’s important to gain instant access to the things they want

it’s important to discover new things based on my personal preferences

63%

62%

64%

BARRIERS TO ADOPTION

NEGATIVE CONSUMER PERCEPTIONS

concerned about potential difficulties when trying to unsubscribe

fear increases in price or changes in the products or services offered

don’t like being limited to certain products within the subscription

47%

35%

47%

TRENDS

UNIQUE SERVICES THAT PEOPLE WOULD SUBSCRIBE TO

CONCLUSIONS

We are shifting into a considerably more modular and granular society.

Fluidity is a key factor in people’s choices and beyond subscription models, you should always be thinking about how your company complies with new consumer mindsets.

CONCLUSIONSIn the old world (let’s call it the Product Economy) it was all about things. Acquiring new customers, shipping commodities, billing for one-time transactions.

But in this new era, it’s all about relationships. More and more customers are becoming subscribers because subscription experiences built around services meet consumers’ needs better than the static offerings or a single product.

THANK YOU!

IULIAN PADURARIU

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