Posted on: Online Payment on September 15, 2021
Subscriptions and recurring payments are here to stay post-COVID-19: new yStats.com report.
The new report from Hamburg-based market intelligence firm yStats.com, “North America Subscriptions and Recurring Payment Market 2021” offers a comprehensive overview of the current state and new developments in the market of subscriptions and recurring payments in North America during the post-COVID-19 phase. Among other findings, the publication reveals that the markets are forecasted to be growing at constant two-digit figures, and businesses are expected to increasingly adopt the subscription method of purchasing and payment.
Consumers worldwide are increasingly opting for subscriptions
During the onset of the pandemic, consumers worldwide realized the benefits of the subscription purchasing methods, and according to a 2021 survey of over 1,500 respondents across the globe, almost two-fifth of them acquired new ones to be able to better cope with the pandemic and restrictions. Consumer spending on various subscriptions increased globally by more than 30% in 2020 compared to the previous year, and in the United States by over 25%. Among the subscription categories, various entertainment services and online news services ranked first in 2021. They were followed by downloadable software, and varied education and cloud-based services, as detailed in the new yStats.com publication.
Businesses willing to implement subscriptions have to pay special attention to certain metrics
There are several E-Commerce business models available for firms that desire to offer subscriptions to their customers. A so-called “Subscription Box” is one of the most used to date, however, there are some others that certain businesses may find much more beneficial, according to the new report by yStats.com. Moreover, subscription businesses must pay attention to specific metrics to succeed on the market, and this applies regardless of the region where the enterprise operates. These include, for example, customer lifetime value – one of the most important metrics for companies that offer subscriptions. If applied correctly, the metrics provide major benefits for businesses. For instance, improved revenue predictability, which allows companies better and more efficient future planning.
Subscriptions increased in the United States during COVID-19 and growth is likely to continue post- pandemic
In the United States, over half of the total music industry revenue in the year, 2020 was brought in by subscriptions such as Spotify and Amazon Music. Furthermore, with market revenue growing by about a quarter between 2019 and 2020, the market share is unlikely to decrease in the post-pandemic times. During the last year, the market growth rate was especially pronounced in the sector of consumer retail products and digital media. Moreover, to secure a superior customer experience, research included in the new yStats.com report suggests that companies offering subscription services need to collaborate with payment service providers that have recurring payment services in their portfolio. According to the recent evaluation of such PSPs operating in the United States, Square ranked first, followed by PayPal and QuickBooks Payment, as detailed in the new yStats.com publication.