Subscription models aren’t just for software – they are transforming how traditional brick-and-mortar businesses grow and serve customers. According to the Subscription Trade Association (SUBTA), the global subscription economy was worth $3 trillion in 2024, up from $2 trillion in 2023. This boom reflects a shift from one-time transactions to long-term relationships and predictable revenue streams.

But here’s the thing: not every business should dive headfirst into subscriptions. Some thrive on one-time interactions. Others have an opportunity to build loyalty and increase lifetime value with the right subscription offering.

So how do you know if it’s right for you? Let’s explore it together…

What Is a Subscription Model?

A subscription model is a recurring billing structure where customers pay a consistent fee – monthly, quarterly, or annually- for continued access to a product or service. The benefits for businesses are undeniable: predictable revenue, improved retention, and more accurate forecasting. On the customer side, subscriptions deliver convenience, cost savings, and uninterrupted service. In essence, it’s about moving from transactions to relationships.

Benefits to the Business:

• Predictable revenue: Regular subscription fees enable more accurate financial forecasting and budgeting.

• Improved customer retention: Ongoing relationships foster loyalty and reduce the need for constant customer acquisition.

• Easier forecasting: Anticipated demand helps in planning and decision-making.

• Higher lifetime value: Loyal subscribers typically spend more over time.

Benefits to the Customer:

• Convenience: Automated deliveries or services save time and effort.

• Cost savings or perceived value: Bundled offerings often provide better value than individual purchases.

• Continued access without interruption: No need to reorder or reschedule every time.

Real-World Examples: From Brick-and-Mortar to Subscription Magic

Many businesses have found creative and profitable ways to embrace this model. Let’s look at a couple of examples showcasing how the right subscription model can resolve key friction points in traditional offerings.

Volvo – “Care by Volvo” Program

• Before: Buying or leasing a car meant upfront costs, insurance hassles, scheduling service, and loads of paperwork.

• After: A monthly fee includes the vehicle, insurance, maintenance, and the flexibility to switch models. Hassle-free mobility.

BarkBox

• Before: Dog owners made unpredictable pet store visits and struggled to choose new toys or treats.

• After: Monthly curated boxes provide convenience, novelty, and guaranteed quality. BarkBox wins loyalty and predictable revenue.

Is your business “subscribable?” Let’s Evaluate Your Readiness

To assess the subscription potential of your business, it’s important to look beyond enthusiasm and do an unemotional, practical evaluation using the Business Readiness Checklist for “Subscription-izing” your business.

Your Business Readiness Checklist:

• Frequency of purchase: Do customers interact with you monthly or more?

• Customer loyalty: Are you seeing repeat business?

• Operational capacity: Can you deliver consistently and reliably?

• Billing systems: Are you set up for automated recurring payments?

• Modular offerings: Can you package your products/services into consistent units?

• Customer value: Would subscribers save time or money?

• Market demand: Are customers asking for this or already expecting it?

• Competitor activity: Are others in your industry succeeding with subscriptions?

• Scalability: Can you grow without losing service quality?

• Compliance: Are there legal considerations for subscriptions in your space?

If you check most of these boxes, then get excited; your business is ripe for implementing a subscription model. But what subscription model will you use? There are many and the truth is you may have to experiment a little bit to see what resonates and is valuable to your customers. With that said, let’s take a look at a few subscription models.

3 Subscription Models to Consider

Once you’ve identified that your business is a strong candidate for subscriptions, the next step is designing the right structure. Here are three common – and effective – subscription types to consider:

1. The Loyalty Builder (Flat Fee Access) This model offers customers unlimited or discounted access for a fixed price. It works best when marginal costs are low and usage drives more engagement.

• Example: $99/month for unlimited yoga classes.

• Best for: Service businesses with consistent availability.

• Upside: Encourages frequent use, increases word-of-mouth, simplifies billing.

2. The VIP Plan (Tiered Access) This model introduces pricing tiers that offer various levels of service, access, or perks. It gives customers choice while unlocking higher-value options.

• Example: $29/$59/$99 plans with early access, premium support, or bonuses.

• Best for: Businesses with layered offerings (e.g., med spas, coaching, digital services).

• Upside: Maximizes customer choice, drives upgrades.

3. The Replenisher (Product Delivery) Perfect for consumable products, this model ensures timely refills and ongoing engagement. It works well when customers need regular replenishment.

• Example: Monthly skincare refills or pet food shipments.

• Best for: Consumable product businesses.

• Upside: Improves retention, streamlines inventory planning.

In 2025, the subscription model isn’t just for software companies. It’s for any business ready to build deeper customer relationships, unlock predictable revenue, and serve people in a way that aligns with how they actually live.

So, is your business ready? Take stock of your offer. Talk to your customers. Run the numbers. Because if the fit is there, a subscription model might not just grow your business – it might completely transform it.