It should come as no surprise that internet shopping is booming right now. Thanks to the current state of global affairs, in the UK alone, 2020 saw the highest online sales growth in 13 years. Thanks to nationwide lockdowns, retail closure and stay-at-home orders, the country experienced its highest annual web sales growth seen since 2007, up 36 per cent year-on-year, according to the IMRG Capgemini Online Retail Index.
For example, Amazon’s UK sales soared by 51% last year to a record $26.5bn (£19.4bn), whilst Uber Eats’ hit a revenue of $1.4bn (£1bn) in the three months to 30 September, jumping 124% from the same period in 2019.
It seems increasingly difficult for brick & mortar stores to compete with these surges in web-based shopping, even when retail reopens for business on the 12th April. Many big names have already succumbed to the realms of administration, or in some cases, liquidation…
The Subscription initially established itself as a popular model for newspapers and magazines, before cementing itself online in music, games, film and TV media. And now it sets its dominance on the rest of the retail markets.
But how far can the subscription model go, and is it possible to live on them alone?
First of all, let me define what I consider a “subscription”. Forget direct debits or repeat orders for identical purchases, I’m talking about the popular “crate” model (or “part works” model) and how numerous services and businesses have applied the novelty of variety in return for a regular payment.
Secondly, let’s define “living”. I see this as two camps. The things we NEED, and the things we ENJOY. However, for the purpose of this article, I’m focusing on the needs. What we require in order to live, as opposed to that which brings frivolity.
So, what do we “need”?
On a survival level, according to Abraham Maslow’s “Hierarchy”, our basic physiological needs include food & water, clothing, and shelter.
As of 2021, according to allsubscriptionboxes.co.uk, there are 93 different food crate services in the UK alone. It’s an incredibly saturated market. Of these 93, 37 of them focus on Groceries, whilst 15 offer a recipe-based service , and another 15 for ready-prepared meals. With both of the latter 2 varieties, the general principle is the same. Each month, a new set of dishes are available to chose from their respective websites, and depending on the tier you have chosen, you pick which you wish to receive. The menus are regularly updated to keep the choices new and exciting. Some of the more popular food crates include Hello Fresh, Gousto, Odd Box, Balance and Abel & Cole. For those of us on a tighter budget, there are simpler “spice & herb” crates from the likes of Simply Cook, The Spicery and Silly Greens.
The clothing market has its own fair share of subscription models. Ranging from monthly socks and underpants, t-shirts and formal wear, right the way up to watches, pretty much all needs can be catered for via one box or another. (There’s now even a monthly subscription box for fashionable face masks and filters, courtesy of Mrsk Club). However, sites like Stitch Fix and Thread take things that little bit further with a “personal stylist” approach. Register with either site and fill in an online questionnaire, give some ideas about your fashion tastes, and they’ll pick out and send you a number of clothing items at a time for you to try. Best of all, you only pay for what you decide to keep.
So what about shelter? How do you “crate” accommodation?
As Lauren Razavi wrote in her Medium article entitled “The Rise of Subscription Living“, there has been an enormous increase in the number of “digital nomads”, people working remotely who favour mobility and flexibility over physical ties.
It’s no surprise that COVID-19 has a major part to play, not just in this area of growth, as people reassess their work/life routines, but also in the dramatic fall in global tourism, and the need for hotel groups and hospitality chains to refocus their efforts.
The devastated hospitality industry has been forced to do some lateral thinking in response to the challenges of Covid-19. Tourism isn’t projected to return to pre-pandemic levels until at least 2024, while hotel occupancy rates are expected to remain 30% below normal levels throughout 2021.Lauren Razavi, “Remote work has kickstarted a hotel subscription-living movement“| Digiday.
In addition, the traditional model of renting or owning your home are far from flexible, particularly in the realms of freelance or contract-based employment. As a response, and in looking to a future Post-COVID economy, several subscription-based accommodation services have arisen. For example…
For $2500 a month, the Inspirato Pass will land you a stay at any of 60,000 luxury vacation homes, hotels, suites and resorts. The caveats being that a) only one reservation can be made at a time, unless you opt for the $5000 or $7500 a month packages, and b) that rooms and resorts are available as pre-packaged holidays, meaning dates and the room or resort capacity are already set.
Meanwhile, from $1550 a month, the Oasis Passport lets you rent out swanky apartments across 14 cities: Austin, Barcelona, Bogotá, Buenos Aires, Denver, London, Madrid, Mexico City, Miami, Paris, Rio de Janeiro, Rome, Santiago, and São Paulo. You just have to stay for 30 nights in one of their 350 homes before you decide to jump to the next one, with either 3 or 6 month packages available. Add to that the promise of no cancellation fees, and no advanced notice requirements, and it does sound pretty impressive.
Stay offers 169 apartments across London, with the additional benefit of utilising workspace at their 8 “LABS” co-working spaces. Added benefits include a tailored welcome grocery pack from Melrose and Morgan; pre-loaded Oyster cards or UBER credit; virtual concierge and gym access.
Meanwhile, Zoku’s sites in Amsterdam, Copenhagen and Vienna can be experienced at €2,750 a month for cosy studio “loft” accommodation, co-workspaces and events.
So who is this all for?
The subscription model is clearly here to stay, and increasingly permeates every corner of the consumer world. However it’s quite clear that with many of these services, there is a target, affluent audience, and as with most capitalist ventures, those looking to gain the most are the ones with most. A box of food is far more approachable than a 30 day stay in Miami.
Still, if these ventures prove successful enough to encourage more businesses adopt a similar sub-based avenue, and the markets open up for more affordable services, we could see a genuine shift in the way we purchase goods, services and even living spaces.