Subscription Trends: 4 Ways The Subscription Economy Is Evolving
Digital subscriptions continue to rise in popularity, with nearly every TV channel offering its subscription service for easy streaming.
Many consumers subscribe to multiple services, but the access to ever-expanding digital content options means that these services must work harder to capture the attention and interest of their subscribers and provide enough value to keep them as customers.
Subscription trends show that while continued growth of around 18% per year is expected, up to 66% of adults plan to cut back on their subscriptions to lower their recurring billing charges. Find out more about how the subscription industry is changing and what that means for your company.
1. Subscription Cancellations Are On The Rise
The increased number of subscription streaming services available today has naturally created competition as services battle for consumer attention and preference. As a result, streaming services now must evaluate their subscription business model to offer better content and value to consumers if they want to keep their business.
A potentially damaging side effect is rising prices. With more emphasis on quality content, the cost to provide content increases. These spikes in price are passed on to consumers. Some services have tried to offset the negative impact of increasing subscription costs by offering tiered pricing for ad-free or with-ad content. Many Americans would consider canceling some of their services to save money.
So, what do these trends in the subscription industry mean for streaming services? One take is that the increase in dropped subscriptions presents an opportunity to appeal to frustrated customers looking to cut costs by providing the very best option at an affordable price. However, another darker side is the pattern of confusing and complicated cancellation processes.
Many services lead customers through a labyrinth of pages and questions until they give up and allow the subscription to continue instead of finalizing the cancellation.
2. Customer Experience, Personalization, and Content Take Priority
Increased user choice translates to a highly competitive landscape for subscription billing services. As a result, companies must focus on providing an exceptional customer experience through personalization and high-quality content exclusive to their platform alone.
An oversaturated market requires media companies to provide more individualized experiences targeting each viewer's specific preferences and interests. According to McKinsey & Company, seventy-one percent of consumers expect companies to deliver personalized interactions. Adding an element of personalization allows streaming services to target each viewer's specific preferences and interests. With the right approach, streaming services can make meaningful changes that reflect customer demand and cement their status as high-value content options.
3. Leveraging Customer Data Is Becoming Critical
Since an individualized approach to content is the key to a successful subscription model in the current market, companies must learn to effectively leverage customer data. Data has quite a bit of power when it comes to creating the perfect customer experience that captures your users' attention and inspires them to commit to using a particular service in the long term.
Analyzing viewer behavior to offer content recommendations that appeal to their interests is a great place to start the personalization process. For example, content creators can now gather real-time data regarding what type of content a viewer watches and how long they watch. This data is invaluable to showcase other similar content the viewer may be interested in viewing.
Recommendations help keep customers around. Platforms have a wealth of content that makes finding something new to watch challenging. The more choices, the harder it is to find something of value within all options. Periodic advertisements draw user attention to their favorite. A streamlined and personalized ad strategy is one of the best ways to ensure users continuously find new content that keeps them invested in your subscription service.
4. SMS Proves Increasingly Valuable For Subscription Commerce
Another surprising trend in the subscription industry is the use of SMS to collect data and provide better value.
When a platform offers the integration of SMS to improve the user experience, they open a whole new way to interact with the customer. SMS text is incredibly effective, with open rates as high as 98%.
SMS marketing gives subscription services another targeted way to give customers real-time data and information to influence their choices. Customers can view recommendations, get alerts and reminders, and interact with the service to tailor their experience more to their personal preferences.
Using SMS is also a great way to make the mundane tasks of using a service easier for the consumer. It's a simple and accessible approach to accessing the subscriber's user information, making payments, and keeping in touch with new activity on their account. SMS is often used to verify actions and ensure the customer approves them to keep the account secure.
Stay Ahead Of The Curve With ApexEdge
Subscription industry trends have both positive and negative effects. While there is tremendous value to be found in some services, the abundance of options and confusing cancellation process mean that many consumers spend more than they would like on services they no longer want. The finances make users reluctant to continue trying new services in the subscription economy.
Create a better opportunity to connect with your customers and provide them with a stress-free way to manage subscriptions with ApexEdge. Our services have a 99% success rate at saving money and providing more value in a stress-free method that customers love. Contact us today to learn more about how we can help you build long-lasting and meaningful relationships with your customers.
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