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North America Subscriptions and Recurring Payments Market 2021

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Description

Countries Covered: Canada, USA

Pages: 56

Publication Date: 21/09/2021

Questions Covered in the report:

  • How did the COVID-19 pandemic affect consumer spending on the top 100 subscription applications globally and in the United States?
  • What are the top reasons to cancel subscriptions for global consumers in 2021?
  • What are the top features provided by subscription merchants in the United States in 2021?
  • Which payment processor ranked first among others that offer recurring payments in the United States?
  • What is the share of respondents who has subscriptions for physical goods in Canada in 2021?

Key Findings:

Subscriptions and recurring payments are here to stay post-COVID-19: new yStats.com report.

Consumers worldwide are increasingly opting for subscriptions

During the onset of the pandemic, consumers worldwide realized the benefits of the subscription purchasing methods, and according to a 2021 survey of over 1,500 respondents across the globe, almost two-fifth of them acquired new ones to be able to better cope with the pandemic and restrictions. Consumer spending on various subscriptions increased globally by more than 30% in 2020 compared to the previous year, and in the United States by over 25%. Among the subscription categories, various entertainment services and online news services ranked first in 2021. They were followed by downloadable software, and varied education and cloud-based services, as detailed in the new yStats.com publication.

Businesses willing to implement subscriptions have to pay special attention to certain metrics

There are several E-Commerce business models available for firms that desire to offer subscriptions to their customers. A so-called “Subscription Box” is one of the most used to date, however, there are some others that certain businesses may find much more beneficial, according to the new report by yStats.com. Moreover, subscription businesses must pay attention to specific metrics to succeed on the market, and this applies regardless of the region where the enterprise operates. These include, for example, customer lifetime value – one of the most important metrics for companies that offer subscriptions. If applied correctly, the metrics provide major benefits for businesses. For instance, improved revenue predictability, which allows companies better and more efficient future planning.

Subscriptions increased in the United States during COVID-19 and growth is likely to continue post- pandemic

In the United States, over half of the total music industry revenue in the year, 2020 was brought in by subscriptions such as Spotify and Amazon Music. Furthermore, with market revenue growing by about a quarter between 2019 and 2020, the market share is unlikely to decrease in the post-pandemic times. During the last year, the market growth rate was especially pronounced in the sector of consumer retail products and digital media. Moreover, to secure a superior customer experience, research included in the new yStats.com report suggests that companies offering subscription services need to collaborate with payment service providers that have recurring payment services in their portfolio. According to the recent evaluation of such PSPs operating in the United States, Square ranked first, followed by PayPal and QuickBooks Payment, as detailed in the new yStats.com publication.

1.Management Summary

2.Global Developments

Subscription Market Sales, in USD billion, and Year-on-Year Change, in %, 2020 – 2025f
Consumer Spending in Top 100 Subscription Applications, by App Store and Google Play Store, in USD billion, 2019 & 2020
Key Metrics for a Subscription Business, October 2020
Key Benefits of a Subscription Business, October 2020
Top E-Commerce Subscriptions Business Models, November 2020
Top Purchased Subscription Categories, in % of Respondents, May 2021
Frequency of Adding a New or Renewing Existing Subscriptions, in % of Respondents, May 2021
Top Purchased Subscription Categories, in % of Respondents, May 2021
Top Factors When Choosing a Subscription, in % of Respondents, May 2021
Preferred Payment Methods for Subscription Contracts, in % of Respondents, May 2021
Share of Respondents Who Prefer Automatic and Manual Subscription Renewals, in %, May 2021
Breakdown of Preferred Pricing Models, in % of Respondents, May 2021
Top Reasons to Cancel Subscriptions, in % of Respondents, May 2021
Annualized Subscription Economy Revenue Growth Compared to the S&P 500 Revenue Growth, in %, Q4 2019 – Q4 2020
Annualized Subscription Economy Average Revenue Per Account Growth Rate, in %, Q4 2019 – Q4 2020
Payment Options Available for Recurring Payments, by B2B and B2C Companies, in % of Payment Decision-Makers, September 2020
Technologies Used to Handle Recurring Payments, in % of B2B and B2C Payment Decision-Makers, September 2020
Percentage of Customers with Failed Payments that Turned into Churn, by B2C and B2B, and B2B Only Companies, in %, September 2020
Implications for B2B & B2C Businesses from Recurring Payments Fails, in % of Payment Decision-Makers, September 2020
Investment Plans Regarding Recurring Payment Service Providers, in % of B2B and B2C Payment Decision-Makers, September 2020
Benefits of Adopting a Recurring Payment Solution, in % of B2B & B2C Payment Decision-Makers, September 2020

3.North America

3.1.United States

Paid Subscriptions Market Revenue, in USD billion, 2019 & 2020
Consumer Spending in Top 100 Subscription Applications, by App Store and Google Play Store, in USD billion, 2019 & 2020
SVOD Revenue, in USD million, 2019 & 2020e & 2025f
Share of Adult Consumers Who Have Select Types of Subscriptions, in %, February 2020 & July 2020 & February 2021
Features That Subscription Merchants Provide, by Provider’s Index Score, incl. Top 30, Middle, and Bottom 30, in %, February 2021
Limited Tier Paid Subscriptions Market Revenue, in USD million, 2019 & 2020
Share of Paid Subscriptions, in % of Total Music Retail Revenue, 2020
Annual Average of Paid Music Subscriptions, in millions, and Y-o-Y Change, in %, 2016 – 2020
Number of Streaming Services in Use, in % of Adults, April 2020 & December 2020
Per Month Average Payment for All Streaming Services Combined, in USD, April 2020 & December 2020
Average per Month Spending for Subscription Services, in USD, by Age Group, September 2020
Top 7 Streaming Services Subscribed or Have Access to, in % of Adults, April 2020 & December 2020
Subscription and Select Internet Activity, in % of Consumers, February 2021
Top Payment Processors for Recurring Payments, incl. Overall, Pricing & Contract, Recurring Payment Types, General Features, and Expert Scores, May 2021
Top Payment Processors for Recurring Payments, incl. Pros, Cons, and Recurring Payment Features, May 2021

3.2.Canada

Share of Respondents Who Has Subscriptions for Physical Goods, in %, March 2021
Share of Consumers Having Certain Number of Subscriptions, in %, April 2020
Estimated Change in the Number of Subscriptions in the next 12 Months, in %, April 2020

  • Amazon
  • Apple Pay
  • Books Payment
  • Disney
  • Google Pay
  • HBO
  • Hulu
  • JustFab
  • NatureBox
  • Netflix
  • PayPal Pay
  • Simple Quick
  • Square
  • Stax
  • Stripe
  • Thrive Market
  • Wave
  • Youtube

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