Why everything has a monthly membership now
There was a time when you heard the word subscription and all that came to mind was Netflix and that monthly gym membership you used twice and then never went back to. Cut to 2026, and monthly memberships and subscriptions are ubiquitous. Your car’s remote start needs a subscription, and so does your printer’s ink cartridge. Even your coffee beans have a monthly membership plan.
There’s a reason why your car manufacturer and your cappuccino vendor are all selling memberships. It’s got to do with recurring revenue. Businesses get more repeat revenue from selling access to a product or service on a regular basis than what they would from a one-time sale, even if it’s a pretty big one. Consumers are happy with the convenience and savings, but there’s also sound business logic behind the subscription and membership economy, as Way.com examines here.
The numbers behind monthly memberships
Here’s how big the membership economy has gotten. A C&R study in 2024 found that the average American spends $219 a month on subscriptions. West Monroe put the number even higher, at $273 a month, and that was back in 2021. Considering inflation, it’s reasonable to expect those numbers have gone up since then. This isn’t a U.S.-only trend either. A 2021 Zuora survey found that 78% of adults across 12 countries had some sort of subscription.
Subscriptions are less of a niche trend now and more of a reliable way to make money every month.
What it takes for the membership model to succeed
Not every membership model works. Amazon Prime, with more than 200 million worldwide and 180.1 million in the U.S., and Netflix, with 325 million paid subscribers, show that it can work really well. But Quibi and Blue Apron, now cited as cautionary tales, demonstrate that it can fail. Then, there’s BMW, which thought it would be a great idea to charge for heated seats. Customers were not happy, and the blowback forced the carmaker to abandon the plan.
The success of a monthly membership model comes down to the value customers see in continuing to pay. Businesses that clearly communicate that value before purchase and deliver on it after are the ones that do well.
Member-only discounts, exclusive offers, loyalty perks and early access are all examples of the value members look for and what keeps them coming back. Businesses should also make billing transparent, cancellation easy and benefits simple to access. Even a great offer can lose members if the whole thing is confusing.
There’s a clear demand for memberships, and it’s growing. Gen Z spends more per month ($377) on subscriptions than any other generation. Millennials are second, spending $276 per month. These generations grew up with subscriptions as the default, not the exception. While this is good news for businesses looking to cash in, it also means these customers may be more willing to switch when a new membership offers better value.
Before launching a membership model, businesses should ask themselves three questions:
- Is the value renewed each cycle?
- Does the customer feel that renewal is worthwhile?
- Is there a one-time purchase that would work just as well?
Get those right, and the economics of a monthly membership can work for other businesses too, just as they did for Adobe.
This story was produced by Way.com and reviewed and distributed by Stacker.
