Over the past two odd years, the consumer behavior has also changed in a big way. The prolonged pandemic has impacted not only our personal finances, but also consumer behavior, among the host of other things in our personal as well as professional lives.
The most notable change in consumer behavior is a shift towards subscription based pricing models, instead of mid to long term ownership. According to a conservative estimate, the global revenues from subscription services could attain US $1.5 Trillion by the year 2025.
Well, the uncertainty that has been brought along by the pandemic is preventing the masses from making long term commitments associated with ownership. Secondly, consumers find this idea of subscription models empowering as well.
As soon as a customer of any subscription service feels dissatisfied, all that needs to be done is not to renew the process, and just walk away. This decision process is also being fuelled by the vast choice that is now available to consumers in most of the cases.
It is not that businesses are not liking this whole new move towards subscription based concept. Enterprises are using this consumer behavior as a means to drive an ongoing process of improvement and innovation in their products as well as services.
To stay ahead of the competition and woo potential customers, businesses will have to outperform the competition, or stand out from the crowd in one way or the other. At the end of the day, this innovation drive is also adding more value for the customers.
When we come to the management of businesses, and other key stakeholders, they are also fine with subscription based pricing models. Such services are now becoming a constant source of steady revenue for businesses, which can be channelized elsewhere.
These subscription based models are also eliminating entry barriers for businesses to new demographics and geographical areas. With no huge upfront investments involved, many consumers are willing to try the new product or service, and then decide accordingly.
Many industry analysts believe this trend is likely to pick even more momentum over the coming months and years, which is something to be seen and monitored.