The term “subscription” means purchasing and reading books, newspapers, magazines, etc. These subscription services have recently expanded to include various types of groceries and household goods, as well as clothing and content. Here, the subscription service refers to a business model that regularly provides products or services to convert consumers into subscribers. One of the factors behind the recent rapid growth of the subscription economy is the “COVID-19 epidemic.” As the demand for non-face-to-face consumption increased due to concerns over the spread of the virus, the demand for subscription services also increased. Aside from these situational factors, the subscription economy is growing rapidly, centering on the MZ generation. Then, why is the MZ generation so enthusiastic about subscription services?
First, this is because one can reveal one’s values and beliefs through subscription behavior. One can reveal one’s values and beliefs through subscription behavior. If existing consumers set the standard of consumption at the quality or price of the product, MZ generation consumers set the standard in accordance with values and beliefs. Second, subscription services are consistent with the consumption tendency of the MZ generation, which values experience rather than ownership. The MZ generation is a generation that considers diverse and exotic experiences as competitiveness. In the past showing off the ownership of expensive products such as cars and luxury bags through SNS was common, but the MZ generation has recently used SNS as a means to display their hobbies and careers which is their experiences. Then, what are the subscription services used by the MZ generation?
Dividing representative subscription services into material consumption and experience consumption, material consumption subscription services include luxury rental services, early morning delivery services, vehicle subscription services, and personalized life-related services. Luxury rental service is a service that allows consumers who are burdened with high prices to use luxury bags at the price of a cup of coffee a day. In addition, early morning delivery services are mainly fresh food, and similar to luxury rental services, there are many people who subscribe to rental services for domestic travel and camping and car camping rather than car purchases. Personalized life-related services are services that provide products that suit consumers’ tastes and bodies, such as salads, nutritional supplements, cosmetics, and underwear.
Next, the experience consumption subscription service is characterized by the fact that it can provide and consume products without restriction in the online service market compared to limited real materials, attracting many consumers. There are OTT online video streaming services, news and magazines in various fields, as well as current events, essay subscription services, e-book subscription services, and educational services and platform services. Recently, SK Broadband launched an all-in-one Playbox PLAYZ product targeting MZ generation of consumers who mainly use OTT. In addition, the education industry also launched subscription services, unlike the existing education operating system, it launched a subscription service that provides one-week delivery, one-on-one mentoring service, and a total of 12 weeks of completed subscriptions for 10,000 won per month. Messenger programs and subscription services are also eye-catching. There is a subscription service called Emoticon Plus by Kakao Talk, the No. 1 messenger user in Korea, which offers unlimited use of existing emoticons and emoticon plus limited emoticons for 4,900 won per month.
What are the advantages and disadvantages of such subscription services? Considering the advantages, it is too convenient for consumers. Modern people’s days are too busy and it is cumbersome to find and do the services they need every time. I can spend my life well and increase the efficiency of my work through subscription service. Also, it is an economic benefit. “Subscribe” means that consumers and businesses promise to continue a long-term relationship. Therefore, consumers can use the goods and services they want at a relatively low price. Companies can also secure customers who continue to use their services, ensuring stable profits.
However, there is a limitation in that subscription services make users who receive them passive. Users will accept products or information as selected and planned by the company providing the service. In the case of OTT services, AI provides various images based on user information. It seems like an advantage on the surface, but paradoxically, it makes users who watch recommended content in this way passive viewers. In addition, users may unintentionally accept indiscriminate and distorted information as it is. In particular, in the case of subscription services such as ‘newsletter’ based on information provision, the inspection of the information is very important. On the other hand, rental services are not privately owned by consumers, so there is a risk of compensation, and food subscription services have been controversial overpackaging and hygiene.
Currently, many platform companies are launching various subscription services targeting the MZ generation. Of course, it is also good for companies to launch subscription services using new items, but in order to prevent the leaving existing subscribers using the services, subscription services must be constantly developed to suit the tastes of subscribers. In addition, as individual values and tastes that are different from others are important, subscription services and custom DIY subscription services that can more delicately match individual tastes should be released. It may also be a unlikely story, but I hope that various companies will collaborate to launch a new subscription service that integrates subscription services from the same stock. For example, I think the launch of an integrated subscription service that combines ‘Netflix’ and ‘Watcha’, which are leading in the domestic market share of otte service, will reduce the burden on consumers who have to pay for multiple services every month.
We live in a world of subscriptions. Beyond milk, newspapers, and magazine subscriptions, the range of subscriptions has expanded beyond physical products to virtual worlds, from regular subscriptions to automobiles, mobile phones and Metaveres. Our daily lives and subscriptions are closely related, and we cannot go back to before experiencing subscription services. However, I am worried that I could pass all the work of thinking about what would be a better product for me and which movie could resonate greatly with me to the subscription service. Why don’t you take the time to find out what I really want sometimes?
K-UNIV
Asia Journal
