The 30 Must-Know Subscription Economy Statistics in 2024

Over the past decade, subscriptions have boomed in popularity. Today, millions of consumers subscribe to thousands of products and services across every industry.

Almost every company has a subscription offering, and some of the most popular subscription services include Netflix, Amazon Prime, and Udemy Business.

The growth in consumer demand is set to fuel the subscription economy’s expansion to $1.5 trillion by 2025.

If you’re interested in learning more about the phenomenal growth of this ecosystem, consumer trends and behavior, and how companies win customers, these 30 subscription economy statistics are an essential read.

Table of Contents
  1. 1. The Subscription Economy Is Set to Grow to $1.5 Trillion by 2025
  2. 2. Digital Subscription Companies Have a Market Cap of $14 Trillion
  3. 3. Subscription Businesses Have Grown 4.6x Faster Than the S&P 500
  4. 4. The U.S. Consumes 53% of All Digital Subscriptions
  5. 5. The Average Monthly Spend on Subscriptions Is $273
  6. 6. 89% of Consumers Underestimate Their Spend on Subscriptions
  7. 7. Millennials Lead the Way With 17 Entertainment Subscriptions
  8. 8. 98% of Consumers Subscribe to a Streaming Service
  9. 9. Streaming Video Is the Most Popular Category for New Subscriptions
  10. 10. OTT Subscriptions Are Set to Reach 2 Billion by 2025
  11. 11. Amazon Prime Commands a 21% Market Share in the U.S.
  12. 12. eCommerce Subscriptions Are Set to Reach $904 Billion by 2026
  13. 13. The Subscription Box Market Will Reach $105.4 Billion by 2032
  14. 14. The Global SaaS Market Is Worth $197 Billion
  15. 15. The Creator Economy Has Tens of Millions of Subscribers
  16. 16. Patreon Creators Earned $1.5 Billion Through Subscriptions
  17. 17. Udemy Business Has an ARR of $443 Million
  18. 18. 36% of Edupreneur Creators Plan to Start Offering Memberships
  19. 19. Free Trials Convert 61.7% of Users
  20. 20. Slack Achieved a 30% Conversion Rate for Freemium Users
  21. 21. It Costs 5x More to Acquire a Customer Than to Retain an Existing One
  22. 22. The Average Subscription Churn Rate Is 4.1%
  23. 23. Dollar Shave Club Has a 54% Quarterly Retention Rate
  24. 24. Businesses Risk Losing 1% of Subscribers Due to Involuntary Churn
  25. 25. PayPal Is the Most Preferred Subscription Payment Option
  26. 26. 53% of Consumers Are More Likely to Unsubscribe Because of Payment Issues
  27. 27. 80% of Consumers Are More Likely to Subscribe if They Can Cancel Online
  28. 28. Incentives Reduced Cancellation by 32%
  29. 29. Subscription Billing and Management Is Set to Reach $7.4 Billion by 2027
  30. 30. 66% of Professionals Believe Online Communities Boost Customer Retention
  31. Conclusion
  32. Frequently Asked Questions

1. The Subscription Economy Is Set to Grow to $1.5 Trillion by 2025

The subscription economy is one of the fastest-growing industries. As of 2020, millions of subscribers supported thousands of companies in building an industry worth $650 billion.

Consumers are increasingly moving towards the subscription purchasing model, which has become a prevalent trend. In fact, over the past nine years, the subscription economy has grown by 435%, and it is set to become a $1.5 trillion market by 2025.

The current state of the Subscription economy and projected growth
The current state of the Subscription economy and projected growth

Fueling the subscription market growth is a combination of consumers seeking more recurring products and companies creating subscription packages to grow their businesses.

Almost every company has started offering subscription packages due to the solid and predictable cash flow they can produce. In fact, the subscription business model growth is largely due to the steady nature that allows companies to expand, grow, and be more attractive to prospective investors.

By becoming subscribers, consumers get many benefits, including convenience, customization, and cost reduction. Streaming services, delivery companies, and ride-sharing apps are good examples of the kinds of businesses offering these benefits.

A day in the subscription economy (source: UBS)
A day in the subscription economy (Source: UBS)

2. Digital Subscription Companies Have a Market Cap of $14 Trillion

A digital subscription is a product or service provided over the Internet. Some of the most common examples are streaming services such as Netflix and educational platforms such as MasterClass.

Currently, the total combined market cap of all digital subscription companies stands at $14 trillion.

Streaming services are part of the media and communication services vertical, representing 34% of all digital subscriptions. Other industries included in the vertical include 5G, WiFi, and music streaming services.

Digital subscription economy verticals (source: UBS)
Digital subscription economy verticals (Source: UBS)

3. Subscription Businesses Have Grown 4.6x Faster Than the S&P 500

Subscription businesses have outpaced traditional ones in the race for growth. According to the Zuora Subscription Economy Index, subscription businesses have grown 4.6 times faster over the past decade compared to the S&P 500.

Why is this telling? Because the S&P 500 is a stock index of the largest 500 public companies in the United States, many of which are decades old and operate in traditional industries.

One of the keys to future growth for traditional businesses may be introducing membership and subscription models to their business plans.

For example, according to a recent report by Manifesto Growth Architects, 70% of businesses were looking to incorporate these monetization methods.

4. The U.S. Consumes 53% of All Digital Subscriptions

The United States consumes 53% of all digital subscriptions, which is far beyond any other nation. Despite having comparable populations, Europe’s combined consumers only represent 21% of all digital subscriptions, which is less than half of the United States’ share.

Many of the most successful digital subscription companies—including Netflix, Disney+, Uber, Amazon Web Services, and Adobe—were founded in the United States, which is a contributing factor.

Region-wise of digital subscription consumption (source: UBS)
Region-wise of digital subscription consumption (Source: UBS)

5. The Average Monthly Spend on Subscriptions Is $273

The growth of the subscription economy resulted in an increased rate of consumer spending on subscription services.

For example, between 2018 and 2021, the average amount a US consumer spent on recurring purchases increased by $430 per year, which is a growth of 15%.

Today, the average monthly spend on subscriptions stands at $273, and this figure includes popular recurring purchases such as cell phone plans and WiFi.

Average monthly subscription spend in the US (Source: West Monroe)
Average monthly subscription spend in the US (Source: West Monroe)

6. 89% of Consumers Underestimate Their Spend on Subscriptions

The growing number of subscription purchases has led to consumers losing track of their spending. In fact, according to a West Monroe report, an astonishing 89% of consumers underestimate how much they spend on subscription services.

In fact, 66% of consumers underestimated their monthly subscription costs by more than $200, while 13% underestimated by more than $400.

Unused subscriptions are another issue that consumers face, with 42% admitting they have forgotten about a subscription and continue to be charged for it.

The most forgotten subscription types are mobile phone subscriptions (31%), Internet (30%), TV/movie streaming (22%), and Amazon Prime (16%).

Most forgotten types of subscriptions (Source: C+R Research)
Most forgotten types of subscriptions (Source: C+R Research)

In terms of generations, Gen Z (55%) was most likely to forget about a subscription, followed by Millenials (48%) and Gen X (43%).

There are several other studies that show similar results. One research has shown that 30% of the monthly subscriptions are unused, while another study found that Brits waste a staggering £25 billion yearly on unwanted and unused subscriptions.

7. Millennials Lead the Way With 17 Entertainment Subscriptions

In a recent study looking at entertainment and media subscriptions, Statista found that the average consumer in the United States had 12 paid subscriptions.

When considering the number of subscriptions by age, Millennials lead the way with 17 each, while the demographic with the lowest number of subscriptions was Matures, with just seven each.

Number of subscriptions by age (source: Statista)
Most forgotten types of subscriptions (Source: Statista)

The total number of paid subscriptions is likely far higher, as this study only accounts for one vertical.

However, Millennials don’t just lead in entertainment and media subscriptions only. They also take the biggest share in retail subscriptions with 39%, while Baby Boomers and Seniors take the other end with only 16%.

8. 98% of Consumers Subscribe to a Streaming Service

Video streaming subscription services are the most popular subscription model, with 98% of consumers subscribing to at least one service and 75% subscribing to two or more.

The most popular streaming services are Netflix, Hulu, and Disney+, each offering shows for different ages and audiences.

Other popular categories that consumers subscribe to are mobile apps (53%), news (39%), and box subscriptions (37%).

Most popular subscription categories (Source: Brightback)
Most popular subscription categories (Source: Brightback)

9. Streaming Video Is the Most Popular Category for New Subscriptions

According to Recurly’s State of Subscriptions Report 2023, streaming video is the leading subscription category, with over 56% of new subscriptions starting in this category in the preceding 12 months. The next popular categories for starting new subscriptions are streaming audio (29%) and gaming (22%).

This is not surprising, given that entertainment is always in demand, and streaming services offer a convenient and affordable way to access a wide range of content.

Subscription CategoryPercentage
Streaming Video56%
Streaming Audio29%
Gaming22%
Health & Fitness20%
Food & Beverage15%
In-Person Entertainment12%
Software11%
Consumer Goods & Retail11%
Top subscription categories (source: Recurly)

Top subscription categories (Source: Recurly)

10. OTT Subscriptions Are Set to Reach 2 Billion by 2025

The enormous increase in OTT TV and video subscribers is set to continue, and it’s estimated that the industry will grow to reach 2 billion subscribers by 2025.

For example, only at the end of 2023, Netflix, the most popular OTT subscription company, had grown to over 260 million subscribers across 190 countries.

Three significant trends will propel this growth: traditional media outlets moving online, many companies incorporating subscriptions into their business, and 5G technology allowing for streaming on the move.

Additionally, traditional broadcasters will be forced to compete with the likes of Netflix, Disney+, and Amazon Prime for audience attention.

11. Amazon Prime Commands a 21% Market Share in the U.S.

According to Statista, the most popular subscription video-on-demand (SVOD) service by market share in the U.S. is Amazon Prime Video. The company had a market share of 21%, compared to Netflix (20%) and Max (15%).

These stats were based on the users’ interests by adding content to their watchlists.

However, just based on the number of subscribers, Netflix is the leader with 80.13 million paying subscribers reported in the U.S. and Canada.

12. eCommerce Subscriptions Are Set to Reach $904 Billion by 2026

During the COVID-19 pandemic, eCommerce companies saw an unprecedented demand for their products, propelling the eCommerce subscription industry to be worth $72.91 billion in 2021.

However, signs of demand haven’t slowed down. The industry is set to keep growing at over 65% year-over-year to reach a market size of $904.28 billion by 2026.

Another report comparing the growth of different subscription services verticals between 2022 and 2023 found that Beauty & Personal Care saw a 21% increase in the average order value (AOV), while Food & Beverage had an 11% AOV increase.

eCommerce subscription AOV vertical-wise (Source: Recharge Payments)
eCommerce subscription AOV vertical-wise (Source: Recharge Payments)

13. The Subscription Box Market Will Reach $105.4 Billion by 2032

Subscription boxes have become a popular type of recurring eCommerce purchase. There are thousands of examples, including clothing, beauty, pet food, baby food, and fitness boxes.

Today, the market size of subscription boxes stands at $32.9 billion and is expected to grow to $105.4 billion by 2032.

One of the most popular subscription boxes is HelloFresh, a meal delivery service with recipes and ingredients. Although HelloFresh saw a decline in the number of active subscribers in 2023 (7.07 million) compared to 2022 (8.5 million) it still keeps a solid position on the market.

HelloFresh subscription growth (source: Statista)
HelloFresh subscription growth (Source: Statista)

14. The Global SaaS Market Is Worth $197 Billion

SaaS (Software as a Service), also known as on-demand software, is the business of giving software access to subscribers using a licensing model.

Today, the industry has grown to house thousands of companies and is worth an estimated $197 billion, with projections to reach $232 billion by the end of 2024. Some popular SaaS companies include DropBox, Slack, HubSpot, and Salesforce.

Dropbox was founded in 2008 as a cloud services company where users can upload and host files on their cloud for a monthly fee. The company has grown to over 700 million registered users and 18.04 million paying customers, earning DropBox a reported revenue of $622.5 million in 2023.

15. The Creator Economy Has Tens of Millions of Subscribers

A recent trend in the creator economy is incorporating subscriptions and memberships into platforms. Some of the most prominent platforms have millions of subscribers supporting millions of creators.

Patreon and Substack are examples of subscription-based creator platforms. They allow fans to subscribe to creators, receiving exclusive content in return. Exclusive content includes newsletters, photos, videos, and Q&A sessions.

Many venture funds have invested in these companies to support the rapid user growth on subscriber-based platforms. For example, in 2021, Patreon raised over $155 million, and Substack raised $90.2 million in five rounds to help expand its platforms.

16. Patreon Creators Earned $1.5 Billion Through Subscriptions

Patreon is one of the leading subscription platforms that enables creators to connect with their fans. Through this service, users can subscribe to their favorite creators for a monthly fee and access exclusive content.

Patreon creators earned $1.5 billion through the platform’s subscriptions in 2021, and Patreon raised a total of $412 million in the span of nine years, from 2013 to 2021.

Patreon creator earnings chart
Patreon creator earnings chart

Currently, the top-earning creator is the yard, with 32,834 paying patrons and an estimated monthly payout of $214,797. However, the most popular Patreon show by the number of patrons is Matt and Shane’s Secret Podcast, with over 80K subscribers.

17. Udemy Business Has an ARR of $443 Million

Udemy is an online course platform through which creators can host and sell courses. The company monetizes courses through two methods: one-off purchases and subscription access for businesses.

Udemy Business has been growing quickly, and in 2023, the annual recurring revenue (ARR) increased to $443.1 million.

Online learning platforms are increasingly moving away from one-time payments over to subscription models of monetization. One example of a platform that has made this transition is MasterClass, which has over 1 million paid subscribers.

18. 36% of Edupreneur Creators Plan to Start Offering Memberships

Subscription-based memberships are gaining in popularity even for independent knowledge creators. For instance, Thinkific, a popular course creation platform, found that 36% of edupreneurs planned to create a membership site in 2022.

Top products creators want to sell
Top products creators want to sell (Source: Thinkific)

Kajabi, another popular membership platform, found the number of memberships purchased through the platform increased from 1.4 million in 2021 to 1.7 million in 2023.

There are many benefits that membership sites offer creators. Financially, one of the biggest is that they give a more predictable income stream. For users, the benefits of being a member include more ways to learn and consume content and greater access to course creators.

19. Free Trials Convert 61.7% of Users

Subscription companies use a variety of offers to promote their products & services, and free trials have to be the most significant one.

According to an AMIC media report, free trials retained 61.7% of consumers from the first to the second month. The same report found that paid trials retained 82.1% of users, which is even greater.

While retention from paid trials might look more attractive, it doesn’t take into account the conversion rate of website visitors to subscription trials.

So, it’s essential for subscription companies to experiment with offers and test what works best for their industry.

20. Slack Achieved a 30% Conversion Rate for Freemium Users

Another popular approach to marketing subscriptions is adopting the freemium model, where you have a limited free subscription and a premium subscription.

Slack, a popular communication platform, runs on a freemium model, giving its users access to a lifetime free account.

As per a report, 30% of Slack users convert their free accounts to paid accounts. This offer helped propel the company to over 10 million active users.

21. It Costs 5x More to Acquire a Customer Than to Retain an Existing One

Many companies spend vast amounts of money to acquire new customers through paid advertisements, so keeping users subscribed for as long as possible is essential to recoup the expenses and be profitable.

In fact, a recent study by Investpcro found that it costs five times more to gain a new customer than to retain an existing one.

Moreover, Investpcro found that once a customer has become a subscriber, their chances of buying another product or service increase to 60-70%, which further improves the customer’s lifetime value.

22. The Average Subscription Churn Rate Is 4.1%

Churn rate is a metric that describes how many existing customers are unsubscribing from the company. It is one of the most essential metrics when assessing the performance of subscription companies.

For membership companies to grow, their churn rate must be lower than the rate they acquire new customers.

According to Recurly, the average churn rate for the subscription industry is 4.1%, and the vertical with the highest churn rate is Digital Media & Entertainment (6.9%).

Software has the lowest churn rate of all verticals at just 3.5%. Since many SaaS companies sell their services to other businesses (B2B), their churn rate is low.

Industry-wise churn rate (Source: Recurly)
Industry-wise churn rate (Source: Recurly)

23. Dollar Shave Club Has a 54% Quarterly Retention Rate

Dollar Shave Club is a direct-to-consumer brand focusing on men’s grooming products. In 2020, the company saw a boom in sales due to the pandemic trend of quarantine beards and haircuts.

The company has retained most of its new customers through its unique product offerings and convenient delivery model. Additionally, they bucked the industry trend of low quarterly retention rates with an industry-leading rate of 54%, as reported by Second Measure.

24. Businesses Risk Losing 1% of Subscribers Due to Involuntary Churn

An involuntary churn is when a user unintentionally unsubscribes from a subscription company. The most common reasons for involuntary churn include failed payments, expiring cards, and credit card declines.

Businesses risk losing 1% of their subscribers each month due to involuntary churn. The number of users at risk of loss varies between industries, from a low 0.8% for SaaS subscriptions and up to 2.5% for Media & Entertainment subscriptions.

Subscription services average churn rates (Source: Recurly)
Subscription services average churn rates (Source: Recurly)

Companies can reduce involuntary churn by using decline management strategies, including automated payment retries and sending out reminders to update payment information.

25. PayPal Is the Most Preferred Subscription Payment Option

As far as subscription payments go, PayPal is the #1 option among consumers, with 45% of them suggesting it as their preferred mode of payment.

It is followed by credit cards (39%), ACH/debit/checking account withdrawal (23%), digital wallets (18%), and in-app payments (16%).

26. 53% of Consumers Are More Likely to Unsubscribe Because of Payment Issues

There are many problems with subscription business models, but payment is the one that’s affecting both customers and subscription businesses.

Nearly 53% of consumers will unsubscribe from a subscription service if a payment issue causes a disruption in their service. Conversely, 61% of consumers would subscribe to a service if they had the freedom to choose their own payment date.

Payment plays a critical factor in the number of subscriptions
Payment plays a critical factor in the number of subscriptions (Source: Recurly)

27. 80% of Consumers Are More Likely to Subscribe if They Can Cancel Online

One factor consumers consider when subscribing to a new product or service is the ease of cancellation. Many customers are looking for a risk-free way to sample the subscription offered.

Brightback, a retention automation software company, found that 80% of consumers were more likely to try or buy a new subscription if they could cancel it online. Additionally, their study revealed that if customers have a negative experience while canceling a subscription:

  • 80% are less likely to make future purchases from the same company
  • 79% are less likely to recommend the subscription to their friends and family

28. Incentives Reduced Cancellation by 32%

When customers try to cancel a subscription, companies will oftentimes use incentives to encourage them to stay. There’s a good reason for this, as incentives offered during the cancellation process can reduce cancellations by 32%.

The same Brightback report that we previously mentioned found that the most effective way to change someone’s mind about canceling was by offering a discount, with 49.13% of customers being retained through this approach.

Other successful retention methods include giving customers account credit, offering a downgraded plan, and pausing plans.

Different incentive types for reducing cancellations (Source: Brightback)
Different incentive types for reducing cancellations (Source: Brightback)

29. Subscription Billing and Management Is Set to Reach $7.4 Billion by 2027

The complexity of the subscription business model has increased dramatically. Founders now have many metrics to track, such as churn, retention, and cancellation rates. In addition to the metrics, the average company size is also growing.

Many billing and subscription revenue management companies have come up to support the growth and complexity of the industry.

Driven by the growing market size and demand for payment and analytics software, the subscription management and billing industry is set to grow to $7.4 billion by 2027.

30. 66% of Professionals Believe Online Communities Boost Customer Retention

Community building has been a major trend across all online niches and verticals over the past few years, and it has emerged as one of the most effective ways to boost customer retention.

As per a study, 66% of professionals say that their online community has positively impacted customer retention.

By having a community, users can discuss problems and ideas and have conversations with other subscribers, creating a sense of personalized customer support.

Users deeply value real-time interaction, with 74.5% of consumers agreeing that access to an online community makes them feel more valued as customers. Another study found that 20% of consumers state the sense of community as a reason for signing up for a subscription.

Conclusion

In this article, we’ve seen how consumers are driving the subscription economy trend for all kinds of products and services and how thousands of businesses are meeting this demand.

Over the next several years, the trend is set to continue, with the subscription economy growing even more.

Whether you’re a business owner looking to ride this wave or a consumer intrigued by this sector, we hope you found our subscription economy statistics interesting and insightful.

We’d love to hear from you, so let us know in the comments what you think!

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