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How Subscriptions Are Evolving

1 min read · 768 views Bong-Geun Choi Aug 26, 2022

The subscription model has come a long way since the first newspaper subscriptions came to life in the 17th century.[1]  From streaming services to grocery replenishment, there seems to be a subscription for everything.  Yet, the subscription economy continues to evolve.  The next wave may include micro-subscriptions and subscriptions in non-traditional industries.


Are Micro-Subscriptions the Next Big Idea?

Most subscriptions charge a fixed price for a specific quantity of a product or service regardless of usage.  However, some brands are beginning to offer micro-subscription plans that personalize the pricing options.[2]


Consumption-based pricing is one way companies are looking to match a product or service’s pricing with a customer’s usage.  The customer only pays for what they use. 


Other companies are offering premium services or add-ons.  For example, SNAP is adding a $3.99 premium option to its basic product.  Some video games are downloadable for free, but players may then pay for expanded features as they wish.


Companies that bundled products and services into one subscription might think about unbundling these and offering these as smaller, less expensive options to meet customers’ needs.  Micro-subscription’s smaller payments may entice more customers to subscribe to a product or service.  In turn, this may provide companies with a more predictable revenue stream and the ability to capture more revenue.


Non-Traditional Industries Offering Subscriptions

A report from Barclaycard Payments indicated that 68% of businesses offering subscriptions will expand their portfolios before the end of 2022. [3]  The report stated that this is being driven by companies in non-traditional industries such as do-it-yourself (DIY) & home improvement and homeware and technology retailers.


The report also noted that companies are creating new subscription-based models designed to be purchased as presents for the upcoming holiday season, with particular demand coming from younger shoppers.


Some examples of non-traditional industry offerings include:


Health & Wellness

For a flat yearly fee, healthcare company MDVIP offers a product bundling that includes preventive care and diagnostic tests along with value-added services like meal plans, fitness programs, and 24/7 physician availability.[4]


Education & Professional Development

Some online education platforms offer free basic instruction with a premium add-on. For example, Codeacademy, a virtual platform that teaches coding skills, offers many of its courses free of charge. However, a subscription to its Pro service gives learners a more focused learning experience that includes exclusive content.[4]


Home Maintenance

Some companies are looking to turn home services into a subscription service. Super bills itself as “subscription care” for the home.  The company looks to fill the role of a superintendent for homeowners, offering on-call maintenance staff in exchange for a monthly fee.[4]


Not Your Father’s Subscription

The subscription-based model will likely continue to evolve as companies look to monetize more of their business and tailor their offerings to meet changing consumer needs and wants.  Companies that offer compelling products with the right pricing model may offer individuals an attractive investment opportunity.


[1] The Subscription Evolution – Putting Design Thinking into Practice, Subscrybe, 10/22/21

[2] The Rise of Micro-Subscriptions, Protocol, 7/24/22

[3] Non-Traditional Options Set to Drive Growth in Subscription Economy, Retail Technology Innovation Hub, 7/27/22

[4] Seven Surprising Industries Turning to Subscription Business Models, CBInsights, 2/26/20


Bong-Geun Choi

Chief Economist


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