Sharing Economy Is Shifting to Subscription Economy
We're seeing a shift in our economy toward subscription-based programs.
We are seeing a major shift in the way we think about our purchases — moving from ownership to membership, from buying one time to making repeated, automatic transactions once a month. Customers enjoy the convenience and value services like Netflix, Scribd, and Birchbox offer them, and every business wants a piece. But companies need to consider what value they bring to the consumer by offering this pricing model, or else they'll lose the loyalty of their customers.
“It is a massive transformation that is changing the way organizations engage with their constituents,” says Robbie Kellman Baxter, author of The Membership Economy, in an interview with PRI. “It’s about a move from ownership to access, from transactional to relational.”
“It’s a little bit more like a marriage, where the consumer commits and the supplier says, ‘I’m going to look out for you, watch your back, and treat you right.’”
It's being a part of a membership — a community. This idea isn't new; in fact, a lot of magazines used to do it and public radio stations still do it. But more recently a number of companies have been asking for $X a month to send you specialized items, like razors, beauty products, or a geeky crate of curated toys and merchandise. These memberships add a value that can't happen through an individual transaction — there's a relationship that forms when deciding to subscribe and with it comes expectations.
“It’s a little bit more like a marriage, where the consumer commits and the supplier says, ‘I’m going to look out for you, watch your back, and treat you right,’” says John Warrillow, author of The Automatic Customer. However, engaging customers in this way doesn't work with all business models.
"Brands get into trouble when companies start "thinking more about their brands than ... about the products or the services."
Baxter explained: “There's a lot of 'me too-ism' right now, like companies are just saying, 'We wanna be a membership company,' or, 'We wanna have a subscription model,' but they haven't really thought through the value to the consumer — they've been more focused on the value to themselves.”
She cites Adobe's switch to a subscription-based service for their one-time purchase software model as a prime example. This move created a lot of backlash with their consumers; after all, what value did it offer them to change?
Brands get into trouble, Lucas Conley says, when companies start "thinking more about their brands than ... about the products or the services." Every business wants to be an Apple and form that cult mentality with their consumers. But you can't have that if you're not meeting your consumer's needs first.
Malcolm Gladwell teaches "Get over yourself and get to work" for Big Think Edge.
- Learn to recognize failure and know the big difference between panicking and choking.
- At Big Think Edge, Malcolm Gladwell teaches how to check your inner critic and get clear on what failure is.
- Subscribe to Big Think Edge before we launch on March 30 to get 20% off monthly and annual memberships.
We take fewer mental pictures per second.
- Recent memories run in our brains like sped-up old movies.
- In childhood, we capture images in our memory much more quickly.
- The complexities of grownup neural pathways are no match for the direct routes of young brains.
It's not just a case of "what doesn't kill you makes you stronger."
- A new study suggests children who endure trauma grow up to be adults with more empathy than others.
- The effect is not universal, however. Only one kind of empathy was greatly effected.
- The study may lead to further investigations into how people cope with trauma and lead to new ways to help victims bounce back.
It's one of the most consistent patterns in the unviverse. What causes it?
- Spinning discs are everywhere – just look at our solar system, the rings of Saturn, and all the spiral galaxies in the universe.
- Spinning discs are the result of two things: The force of gravity and a phenomenon in physics called the conservation of angular momentum.
- Gravity brings matter together; the closer the matter gets, the more it accelerates – much like an ice skater who spins faster and faster the closer their arms get to their body. Then, this spinning cloud collapses due to up and down and diagonal collisions that cancel each other out until the only motion they have in common is the spin – and voila: A flat disc.
SMARTER FASTER trademarks owned by The Big Think, Inc. All rights reserved.