According to research by McKinsey and Company, the online subscription market, led by giants like Netflix and Amazon Prime, has grown annually by more than 100% percent for the past 5 years. To really put that in context, if the entire market made $100 million in 2014, then this year they made over $3.2 billion. A bit of a leap, right?

Calling subscription services ubiquitous feels shockingly understated. Research conducted across 12 countries by The Harris Poll found that the percentage of adults with at least one subscription has grown from 53% to 71% since 2014.

But why exactly are subscription services so popular these days? Is it because of some technological hurdle that we’ve overcome? Or is it due to an elemental shift in our minds and culture? And will the market continue to grow at this exponential rate, or is the bubble about to burst?

With B2C subscription-based businesses, essentially all can be classified as either “subscription boxes” (a delivery of themed goods, usually physical, on a regular schedule, usually monthly) or a digital streaming service delivering film and tv, music, and similar products. Subscription boxes are not technologically dependent and are largely indistinguishable from, say, a magazine subscription from the middle of the 20^th century.

While streaming technology predates the meteoric rise of subscription, internet connections did have to reach a high enough speed, as most of us Australians are painfully aware, to make streaming services a viable product. It is hard to argue that the constant prevalence of easily accessible, high-speed internet doesn’t play a role in making subscriptions account for 62% of total music sales, but again, music streaming isn’t brand new.

If technological advancement is not the deciding factor, the popularity of subscriptions must therefore be due to changing perceptions. Age is certainly a factor, as most subscribers are between 25­–44 years old, but what is the difference between us and previous generations? The same study that tracked the rise in subscription use also found a shift in our psychology towards material goods. The Harris Poll found that 68% of adults believe that status isn’t determined by what we own, 70% view subscriptions as freeing us from the burdens of ownership (e.g. maintenance and clutter), and more than half stated they wish to own less stuff. The suggestion is that people are progressively becoming less materialistic, that time and accessibility have greater value than the pride of ownership.

This trend is beginning to be recognised by businesses — this is why all purchasing processes are being streamlined, from saved credit card details to food delivery — and it is very rapidly spreading to the corporate, B2B sphere. In what should come as a surprise to absolutely no-one, software companies were some of the earliest adaptors of this model. Adobe, for instance, first announced their Creative Cloud subscription in 2011, and it has been the only method for accessing their products since 2013.

On the purchasing side of B2B subscription relationships, the advantages of this new reality are manifold and game-changing, especially for smaller, fledgling businesses. Operational costs are reduced significantly by taking away the burden of needing to purchase resources (consider the difference between buying a printer and getting a document printed at Officeworks), but even more important than these base cost-saving benefits is the mobility they provide. Subscriptions give access to an essentially limitless pool of resources, allowing businesses the freedom to acquire what they need when they need it, and then release it at times when they don’t.

For small to medium-sized enterprises (SMEs), there is added value in subscription services that provide intangible resources. Today’s business environment is highly dynamic in such a way that ongoing organisational success relies on regular development of employee skills and abilities, yet most SMEs have limited budgets, not to mention time, to implement appropriate training. Subscription L&D services, like LinkedIn Learning or our own AIM Access program, efficiently allow for individuals to self-service their professional development and build long-term business value.

If we take a change in cultural psyche to be the driving force behind the growth of subscription services, then it’s hard to predict exactly how the industry will grow in the long-term. The lesson to take away from subscription’s success, however, is very clear: the easier it is to access your product, the more likely your customers will make it to purchase.

When it comes to professional development, organisations often only budget learning and development for selected levels, so many employees miss out on critical training. AIM Access is revolutionising learning by providing personalised development at scale with subscription access to AIM face-to-face short courses at five campuses across Australia.

Find out more