1088 sats \ 5 replies \ @k00b 25 Jan freebie \ on: Applebees offers subscription service - have we reached peak fiat? econ
I think you're onto something. This trend is weird.
I'd love to read a data supported pro/cons for both consumers and producers. I sense consumers are taking a net financial loss given the (dated) stats I've seen about gym memberships. It often makes sense for businesses to lose money on new customers (CAC) when they know they'll recoup it over the customer's lifetime on average (LTV). But, maybe all consumers are giving up is future choice (eg when I go out, I go to applebees for dinner vs somewhere else on average).
It's also possible that subscriptions have always been desirable to both parties but were difficult to implement until recently.
I was thinking about the recent conversation about gift cards. Part of why they work is the company gets paid in advance, so it's basically a zero interest loan from the customer. Then as a bonus, as with gym memberships, the customer usually doesn't use it all.
What's in it for the consumer is harder to pin down, but it's probably a (misguided) belief that they will come out ahead by using it regularly.
reply
I bet it depends on the product/service somewhat too. If a product is nearly identical to a competitor's offering and the customer would otherwise switch between them frictionlessly and frequently (eg Door Dash vs Uber Eats), I can imagine a company offering a subscription with real benefits. Otherwise, it seems like a company only benefits by making me spend money I wouldn't otherwise.
reply
it seems like a company only benefits by making me spend money I wouldn't otherwise
This is gift cards, though, and consumers love them for some reason. In every respect (unless I'm missing something), it's better to just have more cash than a gift card.
reply
reply
That's where my mind was going as well, but a lot of gift cards are for luxuries, like fancy coffee. Maybe that's because the gifter wants them to treat themselves, though.
reply