Every week, we bring you the top stories and analyses from the global Subscription Economy.
Fidelity’s $3 challenge to Schwab: The latest twist in digital advice subscription pricing
Excerpt from an article by Ryan W. Neal on Financial Planning
Fidelity Investments is the latest brokerage firm to embrace a subscription fee pricing model for digital advice. The cost? Cheaper than a Netflix subscription.
Fidelity’s move could help the firm attract more young investors — and it represents another step in industry’s shift away from the AUM-based fee model.
For clients with $10,000 to $50,000 invested with Fidelity Go, the firm’s robo-advisor, Fidelity is dropping its 35 basis point management fee in favor of a flat $3 per month subscription. Customers with less than $10,000 will not pay any fees, while clients with more than $50,000 will continue paying the 0.35% fee.
Fidelity is the only brokerage offering this combination of account minimums, fees and portfolios with no expense ratio funds, says Kelly Lannan, Fidelity Investments’ vice president of young investors.
For more, read the full article on Financial Planning and learn how Zuora is helping eMoney Advisor extend their self-service platform and improve the productivity of their sales teams, financial processes and the customer experience.
Panera exec reveals the strategy behind free coffee subscription
Excerpt from an article by Cherryh Cansler on Fast Casual
Sometimes it pays off to be the first. Just ask Panera Bread, the first fast-casual brand to offer a subscription-based coffee program.
The chain — whose loyalty program has eclipsed 40 million members —rolled out its unlimited coffee service for $8.99 per month in February but in June dropped the fee through Labor Day. That decision has been a catalyst driving growth and revenue for the brand in a challenging year for the industry, said Eduardo Luz, chief brand and concept officer, who pointed out that the service has gained more than 800,000 members.
“The coffee subscription model was in our pipeline long before COVID took effect,” Luz told FastCasual. “Subscription services are table stakes in many other industries, and coffee was a product we saw fitting into that model to create a more convenient and cost-effective option — making it easier than ever for consumers to access, and providing us a recurring revenue stream.”
Start-up thrives as Netflix generation embraces car subscriptions
Excerpt from an article by Paul Smith on Australian Financial Review
An Australian start-up enabling drivers to subscribe to cars, rather than buy them, has rebranded ahead of a global expansion, after a COVID-19-era slowdown in car sales saw a surge in demand from car dealerships.
Loopit [formerly known as Blinker] taps into a generational shift towards subscription-based car use, which has already driven big money investments in online car-leasing start-up Carbar, by providing cloud-based software to dealerships, car brands and other companies to let them offer cars for a monthly fee.
The company has grown quickly, with more than 500 dealerships across the country using the software to offer subscriptions. Michael Higgins, Loopit’s managing director, said dealers could get much more value from each vehicle via subscriptions, with an average revenue of $13,728 per car per year.
“In particular, we’ve seen strong growth overall in the last three months. Across the Loopit provider network, the number of vehicles on the platform has risen from 600 in March to over 4000 cars – and we anticipate this figure to reach 12,000 over the next six months,” Mr Higgins said.