Kuala Lumpur: A new study from Juniper Research has found that the global market value of the subscription economy will grow to US$275 billion in 2022; rising from US$224 billion in 2021. (US$1 = RM4.195)
According to a statement, after evaluating 10 key subscription-based markets, the research identified the following three as generating the highest revenue in 2022, namely Physical Goods; Digital Video; and, Digital Music.
The new report, Subscription Economy: Future Strategies & Market Forecasts 2022-2026, found increased user demand for reliable, recurring deliveries of key items, owing to the Covid-19 pandemic, and the support of automation in subscription services, are key reasons for the uptake of subscription services across these three verticals; representing 75 per cent of global subscription market revenue in 2022.
The research identified that physical goods will account for the largest subscription revenue opportunity and are expected to represent 45 per cent of the global revenue by 2022.
The report confirmed that physical goods subscriptions have seen increased user demand, with users keen to secure reliable sources of medicines and daily essentials in the face of the pandemic.
Additionally, the report found subscriptions to digital services, including music, video streaming, spoken word, and video games, will be a major revenue stream; representing 39 per cent of global subscription market value in 2022.
The research established that support for alternative payment methods was key to growing future subscription-based services. In turn, it urges subscription economy vendors to support multiple payment methods, including Open Banking and digital wallets, to boost convenience to the end user.
Juniper Research recommends that platform providers should focus on the most popular alternative payment methods in their target countries, in order to minimise payment process friction, and so reducing churn.
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