How Millennials Helped Create the Success of Subscription Services

Read Time: 4 min

The newest push in the eCommerce market is somewhat of a shock, recurring payments. While in the past consumers preferred making one-time purchases, the shift has now focused on recurring payments that occur monthly, weekly, and sometimes even bi-weekly. The most surprising catalyst for this market shift is millennials, or maybe that’s not so surprising.

Millennials are credited (and sometimes even blamed) for shaking up numerous industries over the last decade, from cable services to even chocolate consumption. While it’s easy to join in on the harping and cast blame on this generation, millennials have shed light on easier business practices. Their outreach has even extended to market changes that benefit other groups of individuals as well.

The Influence of Meal Subscriptions

Woman preparing a pan of salmon from subscription service

Consider meal subscription boxes for a moment. Born out of necessity, these recurring services first catered to consumers who were unfamiliar with being in the kitchen. If millennials are charged with one accurate offense, it would be a significant lack of household or ‘adulting’ skills. No matter the reason behind this association, it holds up for a lot of self-identified millennials. Early meal preparation boxes solved this problem with simplistic recipes and easy-to-follow guides. Suddenly a flip was switched and subscription boxes made a lot of sense.

Today, meal subscription boxes provide cooking expertise to a varied consumer base. Many have found these subscription services to be convenient and educational. While it’s increasingly easy to eat out or even prepare the same set of meals, food boxes spice up the everyday consumer’s life. Even seasoned cooks have been known to dabble in meal subscription boxes to learn new recipes or experience alternative flavor profiles. While these services were first geared toward young adults, now they reach a wide variety of subscribers.

Convenience and subscription services

The second aspect of generalized millennial habits is the striving toward convenience in just about every aspect of life. Perhaps the most attractive quality of subscription services is the convenience they bring to their subscribers’ lives.

Where there was a time when recurring payments would have been seen as an extreme negative, now they’re praised for convenience. Especially for millennials who are being charged straight from an account and don’t equate the money being taken out with the goods they are receiving. Instead of having to make separate purchases each time, recurring payments bring convenience into everyone’s least favorite aspect of subscribing to a service. This negative option billing process benefits both the consumer as well as the merchant. On one hand, the subscriber is being presented with a consistent service without much thought to billing. Likewise, the merchant can rely on a steady influx of recurring revenue.

The Value of Subscription

Another positive monetary aspect of continuity subscription services or boxes is the consumer’s perception of getting the biggest bang for your buck. An advantage of these services is that more often than not, the consumer is getting a better deal than buying the products on their own. And for service providers, partnerships and sponsorships allow them to offer these prices while still turning a profit. In addition, having something delivered to one’s residence cuts the time needed to shop for those same products. Saving time and money is the recipe for a happy customer experience–especially for a millennial.

The concept of exciting consumers with deals or promotions is not a new, groundbreaking notion. In fact, there have been multiple studies that have researched the direct effect of promotions on consumer habits. Subscribers are after those same rewards. It’s not uncommon to see subscription services offering free boxes or friend referral codes to entice the circulation of their business. And frankly, the efforts have actually paid off. Once subscribers have a taste of the offerings a service provides, they’re more likely to continue the subscription.

Social Media’s Role in Attracting Subscribers

Group of millennials on cellphones

The influence of technology has affected each generation in a different way. For Millennials, social media specifically has proven to be an instrumental tool in influencing purchasing decisions. But it’s not the advertisements on the platforms that are making the most headway. Social media influencers or individuals who have a large following on the platforms have been known to sway consumers’ purchasing habits.

This has been especially true with popular subscription box services like HelloFresh and FabFitFun. Influencers pose with the boxes, displaying the contents or are captured using the items. Typically there are personal codes associated with these sponsorships which benefit both the influencer as well as the service.

Due to the influential nature of social media on millennials, these platforms provide an easy way to advertise. To the consumer, it may not feel like a direct advertisement, but all of these sponsorships are in fact advertising. Because social media users see their favorite influencers using subscriptions, it prompts them to want the same things.

All in all, the influence millennials have had on the subscription space is noteworthy. From inception, subscription services have provided convenience and excitement to subscribers’ lives.