A Decade of Subscription Moments

It’s been quite a year for subscriptions. In 2019, we saw a number of new consumer services emerge as well as strategic enterprise-wide transformations towards subscriptions. From Apple TV+, Nike Adventure Club and the Coca Cola Insider Club to HP’s critical move to subscriptions to recapture market share from Amazon, organizations far and wide acted on the economic imperative to transform into service providers in order to meet new consumer demands.

And now we enter a new decade! One which is sure to bring new subscription launches, new ways for businesses to connect with their customers, and new ways for consumers to consume. But before we close out this last decade, let’s take a look at how subscriptions have evolved over the last 10 years by recognizing just a few notable “subscription moments” in time, innovations and transitions that have dramatically changed not just how businesses do business, but how we all live.

2009
Uber is founded as UberCab. Little did the founders know it would become a multinational service company fueling the subscription economy and introducing a new business that continues to be replicated across industries.

Napster launches its new online paid-for music streaming application, Napster Unlimited, offering over eight million songs in its catalogue.

2010
Hulu officially announces a limited launch of its premium subscription service, Hulu Plus, and Netflix reported that half of its subscribers now watch streams online. Could this be an initial sign of the streaming wars?

Skype rolled out a raft of new monthly subscription services offering its cheapest calls yet across more than 170 countries and a new group video functionality.

2011
Spotify comes to the US, and has come a long way since. In April of this year, the company announced that more than 100M users worldwide now subscribe to Spotify Premium.

Apple launches subscriptions in the Apple App Store, the beginning of the company’s strategic shift into becoming a services provider not just a producer and seller of iProducts.

2012
Game streaming site Twitch, which Amazon will eventually acquire in 2014 for nearly $1B, is founded.

NCR, which has made cash registers for nearly 130 years, announces the launch of new NCR Silver subscription service.

2013
Adobe commits to Creative Cloud, moving outside the box into SaaS. While they had to initially “swallow the fish” (a short-term reality of declining revenue resulting from the shift to subscriptions and the corresponding decrease of big upfront revenue), the strategic move paid off in the long term: Adobe’s stock is now trading for ~$327 today!

2014
Target takes aim at Amazon by expanding a subscription service that regularly delivers products to shoppers’ homes.

EA revolutionizes gaming with the launch of its beta EA Access subscription.

2015
In response to buyer demand, software company PTC puts its entire portfolio on subscription.

Hewlett-Packard plans to split into two different companies: offering hardware as HP Inc. and software and services as HP Enterprise. (In 2019, the company took it one step further, announcing that it will make all its products available through subscriptions.)

2016
Subscription airline SurfAir expands its all-you-can-fly service to Europe.

Sage’s plan to overhaul its business through a subscription-based model is a success, with customers ” embracing closer relationships with Sage.”

2017
Tableau’s shift to a subscription business model begins to pay off, as the company’s stock rises by nearly 40%.

Automotive subscriptions are on the rise. Porsche, Cadillac, and Volvo launch subscription services for consumers.

2018
“‘Furniture as a Service” evolves. Feather, the furniture renting service, announced a new subscription program that gives customers more “furniture freedom.”

Lyft, having been testing versions of an all-access monthly subscription plan, makes the plan available to the U.S market.

2019
2019 was the year of the Wars, e.g.the Media Streaming Wars and Cloud Gaming Wars takeover as direct-to-consumer companies launched and tailored offerings to meet a new age of consumers.

Retailers are embracing the Subscription Economy. Bloomingdale’s, Urban Outfitters, Banana Republic all launched subscriptions this year. However the question remains whether they will truly transform into customer-centric businesses.

We’re excited to see what lies ahead for businesses in 2020. The New Year will surely bring unrivaled growth for those who commit to becoming truly customer-centric organizations via subscription business models, placing customer preference for convenience, simplicity, and flexibility at the core of their businesses.

 

Interested in keeping up with the latest trends in the Subscription Economy in 2020? Subscribe to Zuora co-founder and CEO Tien Tzuo’s Subscribed Weekly newsletter to receive insight into the latest subscription news every week.

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