Subscription Economy News: Week of 09/28/20

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

‘A good job of retaining’: Publishers see subscription resilience as evidence of sticky coronavirus-cohorts grows

Excerpt from an article by Lucinda Southern on Digiday

As the reverberations of the pandemic grind on, wariness around subscriber behavior and market dynamics has kept publishers perpetually on edge.

But as time moved on and more reliable data has been collected, some of those fears are starting to ease. While each publisher differs, there’s mounting evidence of the endurance of digital subscription models in the age of coronavirus.

Zuora released its Subscription Economy Index last week and found that the pandemic has not increased churn rates for publishers. Annual churn was 26.2% for subscription publishers for the second quarter, in line with the average company churn of 25.7% across sectors. Those publishers that fare the best are ones with longer-term contracts, annual rather than monthly.

According to Amy Konary, global VP of Zuora’s Subscribed Strategy Group, “companies with business models built around ownership are afraid to open the spigot,” fearing that “usership models will destroy the business.”

For more, read the full piece on Digiday

A Bicycle Made for Who?

Excerpt from an article by Aftermarket Magazine

Revolutions have a habit of continuing to spin and spin far longer than anyone expects, with often surprising results. Will the current shift in buying and business patterns lead to a major drop in car ownership?

John Phillips, General Manager at subscriptions-focused software company Zuora commented: “Mobility as a Service (MaaS) has been hailed ass a trend which could integrate and revolutionise the way city dwellers navigate their passenger journeys from one form of transport to another. Deloitte has claimed that, in dense urban environments, MaaS would offer such an improved journey and passenger experience that it could replace the need for many consumers to own private forms of transportation…In recent years, consumer appetite has demonstrated a shift from ‘ownership to usership.'”

A recent mobility study published by Cox Automotive highlights that the desire to own vehicles is dropping steeply among younger consumers.

For more, read the full piece in Aftermarket Magazine

More Momentum Building on Subscription Services in Travel, Will It Help Post-Pandemic?

Excerpt from an article by Sean O’Neill on Skift

Travel companies such as CitizenM, Sixt, Trafalgar, Manifest, Bidroom, Upgrade Pack, eDreams Odigeo, and Selina are dabbling in pay-by-month subscriptions. Early signs are promising.

The pandemic has changed consumer behavior in several ways, helping to fuel scattered experiments with subscription-based travel products. Hotel groups, car rental brands, tour operators, upgrade services, lifestyle membership clubs, and other travel companies are testing whether people are willing to treat travel like a Netflix or HelloFresh account, where temporary, on-demand access is more appealing than paying full prices upfront.

Exhibit A is CitizenM, [an] Amsterdam-based brand with 21 properties worldwide that debuted this month two subscription plans. Its “global passport” offers travelers the chance to buy a block of nightly stays at any property at a discounted rate of $50 (€50) a night. Stays must last between 7 and 30 consecutive nights, and travelers must apply to be one of the roughly 1,000 participants.

For more, read the full piece on Skift

Microsoft To Switch to Subscription Model for Some Server Products

Excerpt from an article by Kurt Mackie on Redmond Channel Partner

New application server products coming from Microsoft in the second half of 2021, namely “Exchange Server, SharePoint Server, Skype for Business Server and Project Server,” will be offered only on a subscription basis.

Microsoft announced the move last week in an Exchange Teams post and in at least one [Microsoft] Ignite session.

Subscription-based licensing is typically reserved for Microsoft’s services software, which gets hosted by Microsoft on its own datacenter infrastructure. Exchange Online, SharePoint Online, Microsoft Teams and Project Online are all services where Microsoft controls the software installation, patching and software lifecycles.

Subscription-based licensing gets offered via month or annual payments. If not renewed, organization can still access their data, but they can’t modify it.

For more, read the full article on Redmond Channel Partner

Deliveries package tracking app switches to subscription model, updated with new design and more

Excerpt from an article by Chance Miller on 9to5Mac

Deliveries has been one of the most popular iPhone, iPad, Mac, and Apple Watch for many years, offering an easy way to track packages from multiple services in one place.

The Deliveries app has always been a one time purchase of $4.99 for iPhone, iPad, and Apple Watch, and $4.99 separately for the Mac app. With today’s update, the app is switching to a “flexible pricing” structure based on recurring subscriptions.

“Subscriptions will make it possible to download the app on all your devices and try it for a month, or even a full year, for less than it would have cost to buy both versions. If you cancel your subscription, you’ll still be able to finish tracking any packages you previously added, and look up your past shipments if you need to,” [said the company].

If you’ve previously purchased Deliveries, you can continue using “most features” of the app without a subscription.

Additionally, if you’ve purchased the app in the past, you’ll receive a complimentary subscription based on your original purchase date. According to Junecloud, this ranges from 3 months to 18 months. You’ll see a pop-up notification when you first open the app after updating explaining the complimentary subscription.

For more, read the full piece on 9to5Mac

 

For more Subscription Economy resources and events, head to www.subscribed.com and subscribe to Zuora CEO Tien Tzuo’s Subscribed Weekly newsletter, coming to your inbox every Saturday. 

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