In recent years, subscription-based business models have been increasingly popular in the US. Presently, there are 61 million U.S. customers subscribing to 225 million services that span a wide range of goods and services. These numbers are only projected to grow, as subscription services have been growing at a rate that is 3.7x faster than traditional businesses in the S&P 500. Millennials and Gen Z have been primarily driving this uptake, with almost 40% of millennials and 22% of Gen Z having at least one subscription. As Gen Z matures, they will drive even more growth due to their reliance on subscriptions from a very young age.
The future for subscription models looks very bright. There have already been some very innovative ideas on the horizon, such as personalized toner deliveries, monthly plant subscriptions, and access to the most up to date science-related goods. Services that manage and track subscriptions, like those offered by firms like TrackMySubs and RocketMoney, are also projected to flourish as the younger generation grows more used to paying monthly subscription fees and has to keep track of them all at once. There is a lot of change on the horizon, but companies are still promising the convenience, affordability, and engagement that is their current value proposition.
