Switch to Subscription Model, Before Its Too Late!


Oct 9, 2019 • 3 min read

blog6 (1)The era of owning a product or a service is as old as box television sets. This is the new age of subscription. To keep up with the trends, businesses need to convert into a subscription business. 

Subscription is a booming field, one great example of a company flourishing with this model would be Adobe. 

Below is Adobe market share after they moved to a subscription model. 


Tien Zuo, who earned his MBA from Stanford Graduate School Of Business in 1998, written in his recent book, Subscribed: Why the subscription model will be your company's future - and what to do about it , "If you're not shifting to this business model now, chances are that in a few years you might not have any business left to shift."  Further on in his book, he also talks about how the economy is not about "unknown customers' but actually the customers you have currently. 

Simply put, ownership is dead. Almost everyone is using a subscription plan, be it Grab package, Netflix package, or even the daily newspaper at your doorstep every morning. You may not have noticed, but now you are fully immersed into the subscription world. 

Your concern now may be, if you have to collect the full sum of your product over a period of time instead of collecting it upfront. Wouldn't that mean that you will mess up your revenue and cause it to plummet? 

Well, there are 2 options for you.

  • One, you continue to sell your current physical product and add on an additional digital subscription, such as yearly maintenance/upgrades and what not.
  • Or Two, you can just fully switch to a subscription business, which Thomas Lah and J.B.Wood dubbed this action as swallowing the fish

No, not what you're thinking, not literally swallowing a fish. Come, let us enlighten you. 

Below, presenting to you, the Fish Model. 

Fish model

Source: StanfordBusiness

First glance at this model, you will notice that costs goes up and revenue drops at the start of the switch into a subscription model. However, following the graph, after full transformation into the subscription model, costs will actually go down and revenue will eventually come back up. 

Relating this model back to Adobe, they completely switched to subscription and the revenues were down for a period of time.  Following this drop, Adobe did not sack their staff to commensurate to their revenue. Instead, they did some adjustments to cost and gave detailed metrics to Wall street, 24 hours later they were back up on their feet. 

The subscription model is a low risk, high return business strategy, you would not need to worry, as long as you are keeping your customers needs and wants as your priority.

What else are you waiting for? Jump on the subscription bandwagon if you do not want to get left behind. 

Interested to know more about subscriptions, or keen to banter about subscription models? Request our demo now! We are always ready to provide you with all the information that you need to kick-start your subscription journey.

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Kerenjni is a writer from Singapore who writes articles...considering that you are reading this, it makes perfect sense, doesn't it? Other than writing, she is pretty much obsessed with bubble tea, just like any normal person would be...right?