Consumers are now paying for entertainment, food, beauty products and garments, even bacon, all via monthly rate subscriptions, according to new research.
Soon, according to global subscription experts Zuora, the typical consumer will have everything set up to a monthly subscription payment: cars, fuel, groceries, music and TV, and so much more.
- An estimated 58 million Brits (89% of the British adult population) now subscribe to services, as businesses continue to join the Subscription Economy
- 9 out of 10 Brits choose to subscribe to their favourite stores, brands and services instead of purchasing them on a ‘one-off’ basis, demonstrating an 11 percent uplift from the previous year’s results
- UK consumers’ average monthly spend on subscription services has tripled in the past year, from £18.49 in 2016 to £56 this year, driven by an increase in the number of businesses offering subscriptions to their customers as an alternative payment option
The Zuora study, ‘A Nation Subscribed,’ reveals that nine in 10 Brits choose to subscribe to their favourite stores, brands and services instead of purchasing them on a ‘one-off’ basis, demonstrating an 11 percent uplift from the previous year’s results.
The uptick in adoption has driven the UK adult population to spend on average £56 per month on subscription services, with 35 – 54 year-olds spending the most at £62 every month. Last year’s report found that the average UK adult spends approximately £18.49 per month on subscription services seeing the average monthly spend effectively triple in the past year.
This rise is expected to have been driven by an increase in the number of businesses offering subscriptions to their customers as an alternative payment option in recent years.
The study found:
- A stark rise in the number of ‘conventional’ businesses adopting subscriptions. For instance:
- An estimated 1.7 million people in the UK opt for subscription-based grocery shopping services instead of the traditional weekly shop
- Nearly 600,000 Brits have regular meal-kit subscriptions rather than buying one-off ingredients
- The healthcare sector is also experiencing the same shift with 12% of British adults choosing to pay monthly for prescriptions and private healthcare services.
- The technology industry appears to rapidly be gaining traction among consumers, with an over 7 million UK consumers subscribed to data storage services like Google Drive and Dropbox
- These companies adopting subscription models are in fact growing at a far faster rate:
- The Zuora Subscription Economy Index (SEI) reveals that subscription businesses grew revenues about 9 times faster than S&P 500 company revenues (15.2% versus 2.0%) from January 2012 to March 2017
- Over the past six months, European subscription companies grew even faster at a rate of 22% YoY. Compare that to Euro area economic growth (GDP at just 1.7%)
- This is converting into a rise in the amount that UK consumers are spending on subscriptions every month and a millennial generation that are becoming accustomed to this monthly spend model:
- The nation’s adult population spend on average £56 per month on subscription services, with 35 – 54 year-olds spending the most at £62 every month
- The nation’s adult population spends on average £56 per month on subscription services, with 35 – 54 year-olds spending the most at £62 every month
- Last year’s report found that the average UK adult spends approximately £18.49 per month on subscription services alluding to a significant rise in Britain’s subscription-based spending
- Over a quarter of the UK population believe they will be using more subscription services in five years from now, which rises to more than half among 16-24s
About the research
All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 2,144 adults. Fieldwork was undertaken between 26/07/17 – 30/07/17. The survey was carried out online. The figures have been weighted and are representative of all UK adults (aged 16+).
Figures are extrapolated using ONS population data (source)
View the annual study, A Nation Subscribed, in partnership with YouGov here.