Zuora, Inc. , a leading monetization suite for modern business, released the findings of its Understanding the Modern Subscriber study, which found consumers, particularly younger generations, seek flexibility to shape their payment options around their specific needs and unique consumption habits.
“Acquiring and retaining subscribers have always been about providing ongoing value, but businesses need to diversify their offerings to meet the strong desire for flexibility in landscape”
consumers are increasingly discerning, looking for options that align with their individual buying preferences and usage patterns. The Subscribed Institute at Zuora® commissioned The Harris Poll to conduct a study in May 2024 among more than 2,000 U.S. adults to shed light on consumer habits and preferences tied to how they’re using recurring products and services, such as subscriptions. The findings reveal that the modern consumer seeks flexibility in pricing and convenience, uncovering opportunities for businesses to embrace personalization and value to foster stronger customer relationships, and ultimately, reduce churn.
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Key findings from Understanding the Modern Subscriber include:
- Flexibility is paramount: 80% of respondents said that flexibility in how they buy and pay for recurring products and services was either important, very important or absolutely essential. And when asked about pricing model preferences, across generations, consumers expressed interest in a variety of options.
- Usage-based pricing is an important tool, and critical for certain product categories: Preference for usage increases for certain product categories, with the highest interest in usage for travel (62%), food/restaurant delivery (60%) and retail (58%) services. For recurring products and services as a whole, 22% of all respondents said usage pricing is a preferred method, with even higher interest from Gen Z (32%).
- Cost often drives interest in tailored offerings: Consumer choices are heavily influenced by cost, with 48% of respondents preferring bundles for better value and 30% choosing à la carte offerings when cheaper than a bundle. This value-driven preference for bundles is stronger in older generations (58% of Boomers/Seniors, 52% of Gen X) compared to younger ones (43% of Millennials, 35% of Gen Z). While cost is king, personalization also plays a role, with 23% overall (and 29% of Boomers/Seniors) favoring à la carte when they only want parts of the offering.
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- Subscribers like to come and go as they please: 36% of respondents have canceled and rejoined the same service within a year, while 57% of respondents said that they have subscribed to a streaming service specifically to watch a certain series or event, and then unsubscribed afterwards. Additionally, 78% of respondents said they would be interested in the option to temporarily pause a recurring service, as opposed to canceling.
- Affordability and convenience matter: The top three benefits of subscription services overall are affordability (51%), value for money (37%) and convenience (32%).
“Acquiring and retaining subscribers have always been about providing ongoing value, but businesses need to diversify their offerings to meet the strong desire for flexibility in landscape,” said Amy Konary, Senior Vice President and Founder of the Subscribed Institute at Zuora. “By tailoring to ever-evolving consumer preferences, recurring revenue businesses can foster stronger customer relationships to unlock new avenues for growth and long-term success.”