Subscription doesn't sell a service, but delivers value

Revenues from companies that market subscription services are soaring.

This spectacular growth is supported by impressive figures. In the United States, products or services consumed through subscriptions are expected to reach $1.3 trillion in 2020.

The growth of companies that market subscription services has accelerated since the start of the pandemic. They experienced 12% growth annually during the second quarter of 2020.

A model that appeals through its simplicity

Indeed, the subscription model is appealing due to the simplicity of its approach. It allows consumers to access a product or service while offering businesses a regular and predictable revenue stream.

This approach fundamentally transforms the customer-business relationship. It creates a continuous connection rather than a one-time transaction.

Concrete advantages for consumers

Subscription services remove many daily hassles for consumers:

• Automation of repetitive purchases: No longer thinking about repetitive purchases, like detergent or hygiene products
• Scheduled deliveries: Automatic razor subscriptions that arrive at the right time
• Family solutions: Children's items delivered regularly according to age and needs

Advantage	Consumer Impact	Business Benefit
Automation	Time savings and simplicity	Revenue recurrence
Personalization	Products adapted to needs	Increased loyalty
Predictability	Controlled budget	Easier planning

Beyond simplicity: creating value

While the simplicity of the subscription model attracts more and more businesses, those considering its implementation should not simply stop at facilitating access to a product or service.

Differentiation now depends on the ability to create a unique experience. Consumers expect more than simple access: they seek tangible added value.

Subscription facilitates access to products and services

The choice of a subscription service appeals to more and more consumers because it allows them to easily access a product or service at a lower cost than purchasing, like a car or sports equipment.

Indeed, the subscription model is slowly but surely establishing itself in the automotive industry.

The evolution of consumption behaviors

Consumers are increasingly shunning ownership. What matters to them is easily accessing the use of an asset and benefiting from positive experiences.

This trend is reinforced by the uncertain economic context: consumers are reluctant to commit to expensive purchases.

This behavioral change is explained by several key factors:

• Financial flexibility: Cost distribution over time
• Risk reduction: Avoiding technological obsolescence
• Ease of use: Included services and maintenance taken care of
• Sustainability: Optimization of resource utilization

Comparison of economic models

Criteria	Traditional model (Purchase)	Subscription model	Advantage
Initial investment	High initial investment	Reduced access cost	Subscription
Financial commitment	Important financial commitment	Budget flexibility	Subscription
Economic risk	Depreciation risk	No risk of value loss	Subscription
Maintenance	Maintenance at client's expense	Services included in subscription	Subscription
Flexibility	Long-term commitment	Possibility to stop or change	Subscription
Ownership	Complete ownership	Usage without ownership	Variable depending on needs

The common strategic error: focusing on features

Too often, companies planning to launch a subscription offer focus excessively on the advantages or features of a product.

They forget to concentrate on the real benefits brought to the end customer.

Yet, it is indeed the benefits that encourage prospects to engage in a sustainable subscription relationship.

The logic of value perceived by the consumer

Indeed, what matters to the consumer is how the product or service solves their concrete problem:

• Transportation: They don't buy a car, but a reliable transportation service adapted to their needs
• Entertainment: They don't pay for a streaming service, but for personalized and accessible entertainment
• Housing: They don't want to buy furniture, but furnish their apartment according to their tastes and constraints
• Professional mobility: They don't rent a vehicle, but optimize their professional travel
• Technological equipment: They don't subscribe to an IT service, but secure their digital productivity

The hidden benefits of the subscription economy

Beyond facilitated access, subscription generates less visible but equally important benefits:

• Budget predictability: Cost control over time
• Continuous evolution: Access to latest innovations without additional cost
• Included support: Integrated technical assistance and maintenance
• Usage flexibility: Adaptation to changing needs
• Resource optimization: Cost sharing among users

This value-focused approach constitutes the foundation of a successful subscription strategy, where accessibility is only the starting point of a broader and differentiating value proposition.

A subscription offer must be centered on delivered value

Access to a product or service is certainly a central element of a subscription offer. It's a crucial step for customers to benefit from the product's advantages and features.

However, companies launching a subscription offer must not lose sight of the complete cycle.

Customers derive value from a product or service when they access it, when they consume it and, most importantly, when the product or service works as promised.

The three pillars of value creation

These three ingredients are necessary for customers to obtain desired results:

Pillar	Description	Impact on value
Access	Ease of obtaining the product/service	Determines first impression and initial adoption
Consumption	Effective and optimal use	Directly influences engagement and retention
Result	Concrete and measurable benefit obtained	Justifies renewal and generates satisfaction

The imperative to focus on customer results

But is this sufficient? To create a sustainable subscription offer, companies must focus on results for the customer.

Each purchase corresponds to a desired result. For example:

• Listening to streaming music to dance or run
• Accessing productivity tools to optimize work
• Benefiting from a rental service to reduce investment costs

It is vital for companies to be able to measure these concrete results.

Measuring delivered value: beyond traditional metrics

High-performing subscription companies don't just track classic indicators like retention rate or churn. They develop specific metrics that reflect the real value brought to their customers.

This value-centered approach fundamentally transforms the customer relationship. Instead of simply providing access to a product or service, the company becomes a partner in achieving the customer's objectives.

This value creation philosophy applies particularly well to hybrid models combining rental, buyback and associated services, where each logistics flow can be optimized to maximize customer satisfaction.

How to determine the value of your subscription offer?

To truly understand the added value of a subscription offer, the company must know its impact on customers' lives.

However, technology has enabled the collection of large amounts of data. Marketing research has become increasingly sophisticated, slowly replacing assumptions with real-time behavioral tracking.

This data is crucial for companies: they must have access to it to know how the purchase journey is impacted and what determines customer decision-making.

It is precisely the use of this data that allows us to understand what results the customer seeks and obtains when subscribing to and using a subscription offer.

The pillars of value measurement

Determining the value of a subscription offer relies on several complementary dimensions that must be analyzed holistically:

Dimension	Key metrics	Business impact
Behavioral	Usage time, frequency, journey	Engagement and retention
Financial	LTV, CAC, MRR, churn rate	Profitability and growth
Satisfaction	NPS, CSAT, qualitative feedback	Loyalty and recommendation
Operational	Service costs, logistics flows	Efficiency and scalability

Collection and analysis methodology

The key steps to measure your subscription's value are structured around a systematic approach:

• Real-time behavioral data collection

  • User interaction tracking
  • Usage pattern analysis
  • Identification of moments of truth

• Customer journey analysis and friction points

  • Complete experience mapping
  • Detection of abandonments and their causes
  • Optimization of critical steps

• Measurement of results obtained by subscribers

  • Customer satisfaction evaluation
  • Quantification of benefits provided
  • Comparison with initial expectations

• Continuous optimization based on data insights

  • A/B testing on features
  • Data-driven pricing adjustments
  • Onboarding improvement

• Experience personalization according to profiles

  • Advanced behavioral segmentation
  • Personalized recommendations
  • Offer adaptation to needs

Advanced performance indicators

Beyond traditional metrics, several KPIs specific to subscription models help refine value measurement:

• Customer Health Score: Composite indicator predicting churn risk
• Product-Market Fit Score: Measure of supply/demand adequacy
• Expansion Revenue Rate: Revenue growth rate per existing customer
• Time to Value: Time needed for customer to perceive value
• Feature Adoption Rate: Adoption rate of new features

The importance of qualitative feedback

Quantitative data must be complemented by a qualitative approach for complete understanding of perceived value:

• In-depth customer interviews to understand motivations
• Comment and review analysis to identify improvement points
• Observation sessions to detect unexpected usage patterns
• Co-creation with most engaged customers

This mixed approach helps identify improvement opportunities that wouldn't be visible in behavioral data alone.

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