As the saying goes, necessity is the mother of invention. In times of sudden upheaval, what might have taken years to transform under normal circumstances can reach a tipping point overnight. For example, the lightning-speed manufacturing of ventilators and personal protective equipment, or the production of hand sanitiser by the drinks industry.
As our generation faces its biggest challenge, we’ve seen a huge impact on economies across the world. Nevertheless, life continues regardless, and people have looked for new ways to maintain normality as best they can.
Nowhere is this more apparent than the way consumers have changed their buying habits. Whereas once we could pop to the shop and buy last-minute essentials, people have been forced to look for new ways to get what they need.
As a result, online grocery shopping is expected to grow by more than 30% in 2020. This stands to reason. It makes sense to buy online when you’re not meant to leave the house – especially for those who need to shield themselves for health reasons. With many more people having now experienced the convenience of online shopping, this growth is set to stay.
But online shopping alone isn’t the answer. Why? Because it relies on a consumer searching for what they need, manually placing an order, getting a delivery slot that suits and then waiting for the van to arrive on the allotted day.
This is no good if you need something immediately. For example, ink, which you may require urgently to print a document while home working or a piece of schoolwork for your child. Having watched ink, and indeed printer sales increase over the last few months, we know this is a reality. So, imagine if technology could take care of this for you and enable you to have ink delivered to your door, when you need it.
The subscription economy takes hold
This calls for a new approach to ensure products are always available. It calls for a change in mind-set among consumers, away from short-term purchasing decisions to a more
sustainable one that will help minimise costs, time, consumables and environmental impact. In short, it calls for a subscription. And that’s exactly what’s happening.
People are turning to subscriptions in their droves. When they need something on tap, there needs to be supply running constantly. Consumers have decided that a subscription model – where they buy outcomes, not ownership – is better than struggling to find something at the last minute, on an ad hoc basis. For example, they want to be able to print, when they want, and how they want. Not when the local shop is open or online retailer can deliver it to them.
The subscription economy has really come of age during lockdown. Moreover, the data proves it. According to Zuora, a subscription management platform company, in the first quarter of 2020, the annual rate of sales among some of the 500 largest businesses in the US contracted by 1.9%i. Meanwhile, subscription-based revenue continued to grow at 9.5%.
Initially, the subscription economy was driven by the media and telecoms industry. Most people are used to paying for ongoing access to a phone, internet services or streaming such as Netflix or Spotify. In fact, across the continent, 79% of people subscribe to a phone and 68% to internet servicesii.
This has shifted in recent years and people can now subscribe to everything from razors to protein drinks, and cars to gaming. This benefits consumers in many ways. Instead of businesses being obsessed about a one-off product sale, it requires them to focus on the customer and their needs and experiences. To retain clients, firms need to constantly innovate and please their subscribers to build long-term loyalty.
Our own research shows that people like the idea of subscribing to life’s essentials. In focus groups carried out across, France, Germany, Italy, Spain and the UK, people said convenience was a major factor. They don’t need to leave home to get what they want. In fact, they don’t need to do much at all. Overall, they believed an ink and printer subscription would be simple, comprehensive and stress freeiii.
They also believe a subscription on a monthly basis helps them manage costs. It aligns with their salaries or wages, allowing for better cash flow and planning. Monthly outgoings are also lower compared to quarterly or annual – making it more manageable and less of a high-profile payment. Furthermore, they can be conveniently reviewed or changed if they wish to do so.
To address this, we’ve seen parts of the consumer printing industry shifting towards a subscription model. For our part, we’ve accelerated the availability of ReadyPrint, a range of subscription services that ensure people have the printer they need and the ink to go with it, as they need it. It’s delivered directly to their door as ink runs out and offers savings of up to 90% on overall costs.
The lockdowns we’ve seen have accelerated the growth of the already booming subscription economy. The world of work, school and entertainment won’t be the same again. As a ‘new normal’ settles, it will be one where people are more aware of the things that they need instant access to – and a model to ensure it’s always delivered when they need it most.