Subscription Economy News: Week of 02/24/2020

Every week, we bring you the top stories and analyses from the global Subscription Economy.

Subscription Companies Make Quitting Easier

Excerpts from an article by Matthew Kassel on The Wall Street Journal

Companies that sell subscriptions to products—everything from razors and high-fashion clothing to pet products and meal kits—are locked in fierce competition.

To make their wares more appealing to customers, some companies are executing a counterintuitive twist on that strategy: They are making it easy to quit.

Easy cancellation policies could actually help businesses lure in more subscribers and encourage more customers to come back if they have left, said Peter Fader, a professor of marketing at the Wharton School of the University of Pennsylvania. Such policies, he says, make the subscription experience more personal by making customers feel fairly treated.

That could help the subscription companies’ broader efforts to make recurring shipments and automatic charges feel less transactional and more like membership in a club.

Personalized services and other membership touches help companies connect with customers who are increasingly subscribing instead of making individual purchases, said Tien Tzuo, founder and CEO of Zuora Inc., a provider of software for subscription companies. Companies that offer membership services are trying to project a broader lifestyle that will appeal to customers and add value beyond the product itself, Mr. Tzuo said.

For more, read the full article on The Wall Street Journal

A Look at Michelin’s Product-as-a-Service Strategy

Excerpts from an article by Brian Buntz on IoT World Today

Today, products are often most useful and profitable when offered as services.

In the automotive and trucking realm, evidence of that fact is everywhere. Truck makers like Daimler and Volvo Trucks have growing remote diagnostics and telematics businesses, while traditional tire companies like Continental, Bridgestone, Pirelli and Michelin have expanded fleet management and telematics offerings.

For its part, Michelin is diversifying its traditional tire business with an expanding number of services.

The product-as-a-service shift has compelled Michelin to study its customers to better meet their needs. Ralph Dimenna, a senior vice president at the company, said the process of identifying new services begins with identifying “use cases with an initial cohort of customers to understand how the proposed solution works, what you’re delivering and the customer experience.”

For Michelin, studying customers has led the company to provide tires as a product-as-a-service offering based on distance traveled. Smart tires in airplanes track the number of landings to determine when they need to be replaced. In Formula-E racing, connected tires enable more efficient air-pressure monitoring. In mining vehicles, IoT technology allows technicians to change tires based on the cumulative wear from massive loads of ore.

The subscription model also enables Michelin to provide new services to mining operators to prevent tire failure. “You’re talking about trucks with huge tires that can carry 450 to 500 tons of ore,” Dimenna said. Large loads can cause the tires to heat up and potentially fail. IoT-enabled sensors help mining operators monitor temperature and pressure within the tires so that vehicle operators can reduce their speed when tires are beginning to overheat. “If a surface mine is a couple of miles deep and you have to traverse two miles, the difference between going 35 and 40 kilometers an hour is a big deal,” Dimenna said. In mining, tire failure can result in multiple hours of downtime. In contrast, the ability to determine when a tire has a defined risk of failing will ultimately enable mining operators to coordinate replacing tires with other maintenance, such as oil changes, Dimenna said.

For more, read the full article on IoT World Today

Deere taps tractor-hailing tech in bid to break ground in Africa

Excerpts from an article by Omar Mohammed and Joe Bavier on Reuters

It’s ride-hailing, farm style. Deere & Co. (DE.N) is teaming up with the “Uber of tractors” in Africa and betting on a future where farmers summon machines with the touch of a button.

The world’s leading farm equipment maker is outfitting its tractors with startup Hello Tractor’s technology, which allows farmers to hail the machines via an app, monitors the vehicles’ movements and transmits usage information such as fuel levels.

The aim is to help the U.S. company boost sales of it famous green and yellow John Deere tractors, a tough task in a continent with the world’s highest poverty rate and the least mechanized agricultural sector.

Deere is currently testing the technology – a small black box fitted beneath dashboards – on around 400 tractors in Ghana and Kenya. It told Reuters it plans to roll out the devices across Africa in the second half of this year, offering it to all contractors who buy its equipment on the continent.

For more, read the full article on Reuters

Dell rolls out new subscription model for hybrid cloud deployments

Excerpts from an article by By Stephanie Condon on ZDNet

Dell Technologies on Tuesday rolled out a new subscription-based model for hybrid cloud deployments, available with the Dell EMC VxRail. The new offering includes the hardware and software, as well as the services necessary for relatively quick deployments, such as support, deployment and asset recovery services.

Customers can sign up for a one-year or three-year agreement, priced on a per node, per month basis for as low as $70/node per day. Deployments can take as little as two weeks, Dell said.

Dell claims the new offering is the “fastest hybrid cloud deployment” in the industry.

“In this hybrid and multi-cloud era, organizations see cloud computing as an operating model and not a destination,” Deepak Patil, SVP and GM of Dell’s Cloud Platforms and Solutions, said in a statement. “They are seeking simplified IT experiences with common operations and cost transparency wherever their workloads are located.”

The new offering expands the Dell Technologies Cloud portfolio and is part of a broader portfolio of consumption-based and as-a-service offerings called Dell Technologies on Demand.

For more, read the full article on ZDNet

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