The subscription service economy is trending hot these days. Long gone are the times when consumers invested in big purchases. Instead they are opting for monthly subscriptions to access the product or service. College students, mostly in their 20s, have spurred the growth of this industry, so the Dankook Herald (DKH) decided to take a closer look.
The subscription economy is not a new concept in distribution services, but it has seen its list of products and services grow rapidly over the past decades as the internet continues to develop. Media streaming services, such as Melon or Genie are examples of subscriptions services seeing a rise in users. Consumers "subscribe’ to the music or video streaming services to access their favorite tunes and movies for a regular monthly fee or yearly subscription. Digital technology has enabled people to enjoy their favorite content anytime, anywhere. Subscriptions also cover a variety of other products and services that can be tailored to suit the tastes and needs of consumers. There are subscriptions for beverages, lunch boxes, cosmetics, flowers, daily necessities as well as coffee or beer. According to the online traffic research firm Hitwize, 18.5 million Americans visited at least one U.S. subscription commerce site in the first quarter of this year. This is a 24 percent increase from the previous year. In February 2019, a survey conducted by McKinsey found that 15 percent of online shoppers subscribe to one or more subscription services, thus proving that the subscription economy is expanding its customer base every day and is expected to continue doing so.
The DKH looked at a number of subscription services that may be of interest to our students. DNA Urban Lock Service or "DNA Dosirak" was a service that enabled consumers to customize their lunch boxes and delivered one meal per day to your home. The service was first introduced in early 2019 by the crowdfunding program called Wadiz. It may sound like a typical lunchbox delivery service, but there was a huge difference. The folks at DNA lunch box started by sending you a simple personal gene identification kit before they delivered you any food. This kit enabled the experts at DNA Dosirak, to examine your results and determine what nutrients you were lacking. After that, they sent out a lunch box that was suitable for your dietary needs. Although this subscription service got a great reaction in Wadiz funding, but it did not commercialize yet so unfortunately currently not available.
Another subscription service that might be useful to Dankookians is ‘Daily Shot’, an affordable alcoholic drink service. ‘Daily Shot’ is a membership service that offers liquor to customers at the lowest possible price, for 9,900 won a month. Many students feel burdened by the price of beer and cocktails. With Daily Shot, students can purchase and enjoy a variety of delicious, expensive and diverse drinks at an affordable price. There are two more advantages to ‘Daily Shot’. First, they clean and meticulously manage their beer taps, providing the freshest tasting beverages. Second their beer lineup varies from month to month giving you access to an excellent variety of products trending on the market. The only downside to ‘Daily Shot’ is its locations. You can only find them in Hyehwa and Sinchon, which are both quite far from Dankook University.
|▲ Daily shot is a kind of Subscription economy, and you can subscribe a beer. (Photo from Google)|
The last service the DKH looked at is the fresh vegetable delivery service known as “Mannabox”. Mannabox is an agricultural venture company developed with smart farm technology. They deliver fresh produce to college students at an affordable price. For example, the ‘Ready-mix daily pack’ is a small amount of greens delivered every week at a cheap price. With this service, there is no excuse for students not to eat healthy meals.
The subscription services that the DKH introduced are new, or are not available commercially yet, but they don’t explain why the subscription economy is in vogue. The reason is that the social atmosphere is different from the past, especially when it comes to consumption patterns. For the older generation, ownership of the economic product itself was important. But society has changed. Compared to previous years, the number of single-person households have increased and those in their 20s seeking reasonably priced consumption items have also increased. Most of all, however, the biggest reason for this change is a desire for a variety of products that suit our ever changing tastes. Currently, many 20 somethings care more about the experience than the ownership of the product, so the subscription economy satisfies these needs. That's why the scope of the subscription economy, which was previously restricted to water purifiers and newspapers, has seen tremendous growth and expansion recently.
The subscription service economy is still in the early stages of development. However, studies show that it will grow into a market worth about 594 trillion won in 2020. This is about 30% bigger than it was in 2015. So while we don’t know what creative services will be added and the market continues to evolve from an ownership-oriented economy to one that values experience, we know for sure that new ideas will continue to be launched, that satisfy different consumer wants and needs.
|▲ The market of Subscription economy continues to grow. (Photo from Credit Swiss Report)|
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