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Top 7 Reasons Customers Buy Subscriptions

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The subscription economy is booming. In 2022, the global subscription market was valued at over $220 billion. 

It is now expected to grow to over $470 billion by 2027. 

As the subscription economy continues to grow, so do the expectations of subscribers. Today, it’s not just about the content and service anymore. Subscribers now expect all of their providers to offer several additional key items—on top of an awesome product or service. 

Here are the top 7 things customers look for in a subscription service:

Transparency: Subscribers want to be able to easily understand what they are getting for their money. This includes clear pricing information, as well as details about the features and benefits of the subscription.

Stack and Save / Bundle: Subscribers want to be able to get more of the services they need from a single provider / source. This can save them money and make it easier to manage their subscriptions.

Ease of use: Subscribers want to be able to easily sign up for and manage their subscriptions. This includes having a user-friendly website or app, as well as the ability to easily cancel a subscription if they are no longer happy with it. 

The ability to manage multiple subscriptions: Subscribers often have multiple subscriptions, and they want to be able to easily manage them all in one place. This can help them to keep track of their spending and to make sure that they are not oversubscribed.

Personalization: Subscribers want to feel like their provider understands them and their needs. This means providing personalized recommendations, tailored content, and a personalized user experience.

Convenience: Subscribers want it to be easy to sign up for, manage, and cancel subscriptions. This means having a user-friendly website or app, as well as offering 24/7 customer support.

Value: Subscribers want to get good value for their money. This means offering high-quality products and services at a fair price. The more personalized the offer, the more likely a customer is to buy.

If a provider fails to meet these expectations going forward, subscribers are likely to switch to a competitor that does.

Where Subscription Brands are Failing

With consumer demands becoming loud and clear, why are so many subscription brands reluctant to act on them? 

Fear of competition: Some brands may be afraid to showcase other providers directly on their app. But, it’s always better to be the seller of other services as an add-on, versus losing a customer to another provider completely. Consumers can find competitors on app stores and google searches and convert to them there, or purchase them as an add-on directly from within one of their existing apps. 

Fear of cancellations: Some brands may be afraid that if they make it too easy for subscribers to manage their subscriptions, they will be more likely to cancel them. This is a valid concern, but it is important to remember that subscribers are more likely to cancel a subscription if they are not happy with it. By making it easy for subscribers to manage their subscriptions, brands can reduce the number of cancellations. And, the harder it is to cancel, the less likely they are to come back again later.

Brand ego: Some brands may be reluctant to change their business model because they are rightly proud of their brand and prefer it to be the number 1 option for all consumers. However, consumers now have 12+ subscriptions on average and every brand will always be one of many going forward. The subscription economy is constantly evolving, and brands that don't adapt will be left behind for those that do.

Cost: Implementing new strategies can be expensive, and some brands may not be willing to make the investment. However, the cost of not implementing these strategies can be even higher. For example, if a brand doesn't offer a way for subscribers to manage their multiple subscriptions, they may lose subscribers who are simply too busy to keep track of them all. 

Lack of understanding: Some brands may not fully understand the expectations of their subscribers. They may think that subscribers are happy with the status quo, when in reality they are looking for a more convenient and personalized experience. By taking the time to understand the needs of their subscribers, brands can make better decisions about how to improve their customer experience.

Lack of resources: Some brands may not have the resources they need to implement new strategies. This could include things like time, money, or manpower.

Internal resistance: There may be resistance to change within the brand. This could be from employees who are afraid of change, or from executives who are reluctant to make the investment.

Some of the biggest brands (Netflix, Verizon, Spotify, Prime) are showing their ability to make managing, stacking, and bundling a key part of their offering for their subscribers. They understand that appealing to consumers' overall needs is the key to lower acquisition costs, higher LTV and wider margins.

This is a trend that will continue to unveil itself for brands of all sizes as they attempt to meet consumer expectations going forward. Getting over some of the barriers to creating an amazing consumer experience can be tricky these days, but with the downside of NOT addressing them being slower growth and faster churn, it's worth the effort.

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