Nearly a quarter of German consumers use online subscriptions for products such as razor blades, shampoo, or flowers. On average, they have three active subscriptions. This is according to research by the digital industry association Bitkom among more than 1,000 German consumers.
In subscription commerce, online shoppers commit to receiving one or more products delivered to their homes on a regular basis. These can be items that consumers would rather not run out of, such as razor blades, but also monthly surprise boxes with cosmetic products. Meal kits are another example of subscription commerce, with German companies HelloFresh and Marley Spoon among its best-known representatives.
The rise of subscription commerce
The rise of subscription commerce began around fifteen years ago. Research by ING in eleven different European countries showed that in 2018 households spent an average of 130 euros on subscriptions, accounting for around 5 percent of their household budget. The bank expected this share to grow significantly, but never conducted a follow-up study.
Analysts expect subscription commerce to grow rapidly
According to various other sources, subscription commerce has indeed grown since then, although retaining subscribers can be challenging. Analysts expect high double-digit growth rates in the coming years.
‘Consumers and companies benefit’
In Germany, there is still considerable room for growth: around three quarters of consumers there do not currently have a product subscription, according to the Bitkom study. Those who do have products delivered automatically on a recurring basis, have an average of three subscriptions. “Consumers benefit from the convenience and often also from price advantages,” says Bitkom expert Nastassja Hofmann about the advantages of the model. “Companies can plan recurring demand more effectively, make processes more efficient, and strengthen customer loyalty.”
‘Transparency is essential for the growth of subscriptions’
According to Hofmann, unfamiliarity with the ins and outs of the model means that product subscriptions are not yet popular with everyone: “For subscription commerce to gain a stronger foothold, transparent and easy-to-understand information is essential — for example about lower prices, flexible terms, and cancellation options.”
Social commerce in Germany
Bitkom regularly publishes research on online shopping behavior in Germany. Last month, it found that three in ten German consumers shop via social media, with Instagram as the leading platform for social commerce.
