The Rule of Threes: The subscription economy from a consumer’s perspective

The shift away from traditional subscriptions will quicken pace, driven by the proliferation of on-demand solutions across all areas of modern life. Categories like content consumption (Netflix, Spotify), Travel (Uber, Lime), and food delivery (Deliveroo, DoorDash) are creating an atmosphere on everything on our terms, at all times. These category-... See more

Consumers are adopting the model after becoming comfortable with Netflix and Spotify as the “Pioneer” CSS services. Now consumers are expanding their purchases to capture better experiences in broad and exciting new verticals including family communications, travel, exercise, hobbies and religion.

On the other hand, the idea of increased productivity is a harder sell in the home. Generally speaking, consumers prefer subscriptions when there’s a clear cost savings for the “all-you-can-eat buffet” vs. a la carte purchases.

Subscription businesses allow you to distribute portions of your revenue to people who add value. This isn't rocket science this has been the business model for cable businesses for decades.

Today's consumer subscription leaders are aggressively expanding the definition of what it means to serve their customers — Peloton's lofty vision in its S-1 and Daniel Ek's reframing of Spotify as an all-encompassing audio platform are the two most notable examples.