The subscription model gathers pace.
I am a huge fan of subscription clubs, that's pretty self evident as I am a member of several and run several more myself, my nickname is even "The King of Clubs" so I have to approach this morning's news from Volvo with an obvious note of bias to the model.
This morning Volvo cars UK rolled out their new subscription model for buying a new Volvo car, it has to be said that throughout their history Volvo has been known as a business who are not afraid to push the envelope, despite their cars being known for safety they have pushed forward with hybrid technology and were one of the first to offer in-house leasing, where Volvo lead other's follow.
Reading into the info they've released (there is a link at the bottom of the page) the model differs from a leasing model in the same way that other subscription clubs do, with flexibility, rather than being tied into long term contracts your subscription lasts 12 months and can be ended with 3 months notice.
I am genuinely excited to see move by Volvo, as a huge proponent of the subscription model I think it's a fantastic way to move a market forward when a lot of people are being priced out the market for EV and hybrid cars or are scared that technological advances will harm resale values for what is going to be their second largest single expense.
The ability to be flexible is also a huge bonus as we don't know what next year will bring for employment, finances etc, I also assume it's going to also mean an opportunity to subscribe to a new vehicle or perhaps an nearly-new one for a reduced rate over time.
The real benefits of Volvo adding a subscription model to it's options is that as with all big business, they bring with them their technology and systems to any market they enter. Member tracking and communication is something I'm going to be watching closely as areas that are vital to running a subscription business and if their processes for mass subscription are innovative, then all the better.
Of course, large business has used subscription successfully for years, whether it be gyms who moved from annual contracts or tie-ins to no contract month-by-month subscription with great success or the corporate behemoth which is Nestle using it's model with Nespresso (with varied levels of success)
This year I have plans to open some more subscription based clubs and my faith in the models benefits for both subscribers and those who run the clubs is unshakeable, the important thing is the quality of the club, there are so many clubs out there (especially in the coffee space) but very few are run well and that leads to unhappy subscribers something not good for the subscribers, the business or the model as a whole.