Subscription economy to be worth almost $1 trillion globally by 2028

A new study by Juniper Research found that by 2028, subscription economy revenue will reach $996 billion, up from $593 billion in 2024; a substantial rise of 68%. This growth will stem from the proliferation of subscriptions into a broader range of segments, such as Mobility-as-a-Service, physical goods boxes, and delivery services. 

Subscription management platforms, such as Recurly and Zuora, increasingly offer ways to reduce churn and support diverse payment options, fostering overall growth.

Subscription Platforms Must Prioritise Churn Prevention

Several prominent subscription markets are currently undergoing regulatory changes. The US is among the first to implement regulations, ensuring easy cancellation with its ‘click to cancel’ bill. While this will increase churn, subscription merchants will increase their investment in customer retention; creating opportunities for subscription management businesses.

Juniper Research found that to move into this space, subscription management platforms need a greater focus on churn reduction technologies, including intelligent card retries. By employing machine learning capabilities, merchants can gain a greater understanding of consumer reasons for cancellation, proactively issuing personalised loyalty rewards to counter churn.

Hyper-personalisation Will Improve Customer Retention

The research found hyper-personalisation can significantly improve retention, especially via algorithm-powered product tailoring. The two industries which have moved furthest into this space, digital music and digital video, are forecast to reach a combined revenue of $370 billion by 2028; facilitated by personalised products like ‘Spotify Wrapped’.

The research recommends subscription management platforms invest in AI for consumer tracking. Enhanced data insight capabilities will significantly aid in sustaining customer relationships; enabling optimised marketing strategies.

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Find out more about the new report, Global Subscription Economy Market 2024-2028, or download a free sample.