1. CONVENIENCE

• Subscribers want to have the convenience of watching/listening anytime and on any device. (S1)
• According to a survey conducted by Widmeyer Communications for 1,000 US subscriber of digital services, 29% of the respondents ranked convenience as their main reason why they subscribe to services.
• The auto-renewal ensures that customers do not run out of products or have their service suspended because they forgot to pay a fee. Customers do not have to remember to refill or reorder anything every month. It saves them from the decision-making process for simple and repetitive purchases.
• By paying a regular fee, the consumer gains access to a product or service which is mass-customized by the use of big data and often includes a surprise element to retain interest.
• Streaming services mean having the world's complete history of film at your fingertips, providing thousands of options on what to watch and enjoy without leaving the comfort of your home.
• Netflix is very easy to use as users do not have to set up anything after subscribing. Netflix also allows users to download the content and watch it offline. This means that users can watch it anytime anywhere without the need for internet connections.
• Spotify offers premium users the ability to upload music into their library on one device and become available on most devices that they own, making it very convenient for users who own multiple devices and the ability to save songs offline in Spotify and listen anytime anywhere without the need for internet connections.

2. VALUE OF SERVICE

• According to a survey conducted by Widmeyer Communications, 26% of the respondents listed value of service as one of the reasons why they subscribe to services.
• The Subscription model adds value to customers through bundling, which refers to buying multiple products/services with the price of one.
• Because of the “passive purchasing process,” subscriptions can sometimes go unnoticed, and customers want to receive communications regularly in a way that adds value to their relationship with the brand. This can be through “promotional messaging or non-transactional content.”
• The key is to grow the relationship with the customer continuously and is particularly important when nearing the “end of the subscription lifecycle.” Consumers are unlikely to renew their subscription if they have not heard from a brand in a long time.
• According to a survey conducted by Digitas’ intelligence hub Vera for over 2,000 consumers, 68% of respondents prefer to hear from subscription companies via email, 23% prefer text messages, 17% prefer ads on social media platforms, and 15% prefer TV ads. Only 9% prefer push notifications, 8% do not want to hear from the companies at all after subscribing, and 3% like chatbots. 36% of the respondents also noted that access to free content is one of the reasons why they subscribe.

3. COST-SAVINGS

• According to a survey conducted by Widmeyer Communications, 21% of the respondents listed cost-savings as one of the reasons why they subscribe to services.
• Subscriptions often offer the products or services at a flat rate. This enables the customers to stay within their budget by predicting and controlling their spending.
• According to a survey conducted by Digitas’ intelligence hub Vera, 46% of the respondents listed cost-savings as one of the reasons why they subscribe to services.
• Sometimes digital services offer savings to their loyal subscribers and customers are more inclined to continue their subscription as they save more money while continuing to use the service.
• Netflix offers membership plans that target different users, and they can upgrade and downgrade anytime.

4. SELECTION

• According to a survey conducted by Widmeyer Communications, 12% of the respondents listed selection as one of the reasons why they subscribe to services.
• Streaming services can now cater to specific audiences, providing a range of genres such as foreign films, independent films, and documentaries.
• According to a survey conducted by Digitas’ intelligence hub Vera, 49% of the respondents listed large variety/selection as one of the reasons why they subscribe to services.
• Netflix offers original programs that are only available on their platform.
• According to a study by Harvard Business Review, offering original content is one of the important ways that streaming services can differentiate their offerings from competitors as subscribers are more likely to continue using their service if they can access more original contents.

5. PERSONALIZATION

• According to a survey conducted by Widmeyer Communications, 12% of the respondents listed personalization as one of the reasons why they subscribe to services.
• Many subscription services include personalized recommendations for the subscribers, triggering their curiosity and allowing them to try something new conveniently.
• By leveraging consumer data, subscription providers can customize their offerings and cater to the needs of an individual subscriber.
• Customers want brands that recognize and actively work to understand their unique preferences, wants, and needs.
• Spotify allows premium users to save and create a playlist for any songs.
• Many streaming music subscriptions offer “on-demand access to tens of millions of tracks and hundreds of thousands of playlists, some of which are customized to the subscriber.”

6. NOT HAVING TO DEAL WITH ADS

• According to a survey conducted by Digitas’ intelligence hub Vera, 39% of the respondents listed not having to deal with ads as one of the reasons why they subscribe to services.
• Netflix is commercial-free. This means that when customers find a film or a show they want to watch and click “play,” they can watch it without being interrupted by ads.
• Spotify offers their services for free but ads will appear now and then and they could disrupt the listening experience of the user. Therefore, most users upgrade their plan to enjoy their experience when using Spotify.

DEMOGRAPHICS OF DIGITAL SUBSCRIPTION SERVICES

• According to Statista, the types of services that Americans subscribe include over-the-top/video-on-demand, shopping, audio, print media, professional services, lifestyle, financial services, health and wellness, learning services, dating services, and others. The most subscribed services are over-the-top/video-on-demand (76%) shopping (62%), and audio (37%) [Screenshot].
• The subscription e-commerce market has increased by over 100% a year over the last five years.
• The most popular subscription services for online shopping are Dollar Shave Club, Blue Apron, and Birchbox, while the popular media-based subscriptions are Amazon Prime, Netflix, Hulu, Spotify, and Class Pass.
• Gender: 60% of digital paid service subscribers are women. However, men are likely to pay more than subscription services.
• Age: The majority of e-commerce subscribers are 25-44 years old. According to the American Press Institute, 4 out of 10 adult subscribers for digital news subscription services are aged 35 and below. According to Business of Apps, the median age of paid subscribers for Netflix falls in the 35-44 age bracket.
• Location: The majority of e-commerce subscribers live in urban areas, especially in the Northeastern part of the United States. 77% of digital audio services users are living in urban areas.
• Income: The majority of e-commerce subscribers have an annual income of $50,000 to $100,000. The majority of digital audio services users falls under the top 25% of household income groups.
• Education: The education level of subscribers for over-the-top/video-on-demand services ranges from high school graduates to degree holders.

WHY CONSUMERS COMMIT/SUBSCRIBE TO THESE SERVICES/PLATFORMS

• The main reasons for subscribers who pay for a curation-based subscription are convenience, value for money, personalized services, and high-quality experiences.
• The main reasons for digital news subscribers include access local news (30%), convenience (15%), topical focus content (12%), and trust and quality provided (9%).
•  96% of Netflix subscribers cited access to original content as the primary reason for subscribing.