New study from Zuora and YouGov finds a rise in automotive, energy and healthcare sectors shifting to recurring revenue models
Zuora, Inc., the leading SaaS provider of subscription order-to-cash solutions, today released a new study in partnership with YouGov which shows an estimated 58 million Brits now subscribe to services – 89 percent of the British adult population – as businesses continue to join the Subscription Economy®.
The Zuora study, ‘A Nation Subscribed,’ reveals that nine in 10 Brits choose to subscribe to their favorite stores, brands and services instead of purchasing them on a ‘one-off’ basis, demonstrating an 11 percent uplift from the previous year’s results. The uptick in adoption has driven the UK adult population to spend on average £56 per month on subscription services, with 35 – 54 year-olds spending the most at £62 every month. Last year’s report found that the average UK adult spends approximately £18.49 per month on subscription services seeing the average monthly spend effectively triple in the past year.
The rise in subscriptions can be attributed to an increase in the number of businesses across nearly all industries offering recurring services. According to the Zuora® Subscription Economy Index™, this business model strategy has proved that subscription businesses grow revenue nearly nine times faster than the S&P 500.
Subscriptions have moved beyond just media and entertainment consumption and have expanded to include grocery shopping services, attracting nearly 2 million consumers, in-car apps counting 650,000 subscribers in the UK, and beauty and grooming subscriptions like men’s shaving subscription service, Harry’s, with over 1.3 million British monthly subscribers. Dramatic growth of online data storage services like Google Drive and Dropbox with 7 million UK consumers. The healthcare sector is also experiencing the same shift with 12 percent of British adults choosing to pay monthly for prescriptions and private healthcare services.
What’s more, this trend is set to continue along its growth trajectory as an estimated 25 percent of UK adults predict that they will be subscribing to more services over the next five years.
“Nearly all of the British population is part of the Subscription Economy. From heating to healthcare, Zuora’s new study proves that the subscription-business model has gone mainstream and consumers have bought into recurring payments,” said Zuora’s VP EMEA, John Phillips. “The only way businesses can sustainably maintain relationships with consumers and grow is by moving away from their product-centric mentality and creating long-term brand affinity based around flexible subscription-based services.”
The full results of the YouGov study are explored in full in a new Zuora report released today, “A Nation Subscribed: 2017 State of the UK Subscription Economy” and unveiled at Zuora’s annual Subscribed event in London. The report provides insight for UK companies in all industries about how they can shift and transform business models in line with consumers’ preference for on-demand, personalised, and subscription-based access to services.
Go to https://zuorainternprd.wpengine.com/resource/a-nation-subscribed-2017-state-of-the-uk-subscription-economy/ for the full UK Subscription Index, including data on the popularity of specific subscription services available in the UK.
“The Subscription Economy: A Business Transformation” by Tien Tzuo, CEO of Zuora
SlideShare: “Drivers of Success in the Subscription Economy”
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About Zuora, Inc.
Zuora, the leading Subscription Economy® evangelist, provides the only SaaS platform that automates all subscription order-to-cash operations in real-time for any business. Companies in any industry can launch new businesses, shift products to subscription, implement new pay-as-you-go pricing and packaging models, gain new insights into subscriber behavior, and disrupt market segments to gain competitive advantage. Zuora serves more than 1,000 companies around the world in a wide range of industries, including Box, Komatsu, Rogers, Schneider Electric, Toshiba, Xplornet and Zendesk. The Subscription Economy Index (SEI) demonstrates that SEI companies are growing revenues approximately nine times faster than the S&P 500. Headquartered in Silicon Valley, Zuora also operates offices in Atlanta, Boston, Denver, San Francisco, London, Paris, Beijing, Sydney, Chennai and Tokyo.
YouGov is an international market research firm, headquartered in the UK. With over 3.3 million people participating in their panels to produce the largest daily updated record of people’s habits and opinions in existence, it is the most quoted source in the UK. It was founded in 2000, and now employs 591 people worldwide.
About The Research
All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 2,144 adults. Fieldwork was undertaken between 26/07/17 – 30/07/17. The survey was carried out online. The figures have been weighted and are representative of all UK adults (aged 16+).
© 2017 Zuora, Inc. All Rights Reserved. Zuora and Subscription Economy are trademarks of Zuora, Inc. Third party trademarks mentioned above are owned by their respective companies. Nothing in this press release should be construed to the contrary, or as an approval, endorsement or sponsorship by any third parties of Zuora, Inc. or any aspect of this press release. To learn more about the Zuora platform, please visit zuorainternprd.wpengine.com.