Understanding the Subscription Business Model

The advantages of subscription services: For companies and customers

Low initial outlay — encourages adoption that otherwise couldn’t be afforded

Greater flexibility — lower risk

Constant revenue stream

Subscriptions may align with costs incurred

Limitations of the subscription business model

Buyer preferences to resist recurring payments

High churn in subscribing customers

High user-churn can have high onboarding costs

Further thoughts: Examples of subscriptions services

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Startup Sloth

Startup Sloth

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Helping startups, small businesses, and freelancers develop a strategy, write a business plan and successfully compete.