What if the best customer for a subscription isn't the person who loves it, but the person who forgets they still have it?

That sounds a little cynical. It is also one of the most important ideas in the subscription economy.

Netflix doesn't need every customer to binge every night. A gym doesn't need every member to show up. A software company doesn't need every subscriber to use every feature. They need something simpler: keep the card attached.

That is the beautiful part of recurring revenue from a company's perspective. With a normal sale, the company has to convince the customer to buy again.

With a subscription, the company already has the payment relationship. The default is renewal. Silence becomes revenue.

Subscribe to keep reading

This content is free, but you must be subscribed to Penny Brief to continue reading.

Already a subscriber?Sign in.Not now