Attracting new customers is more expensive than maintaining existing customer relationships. Subscription commerce represents an efficient way for companies to strengthen their customer loyalty and create stable revenue streams. In times of market volatility and fluctuating demand, the subscription model can be a solid foundation for building long-term growth.

This article explains subscription commerce, its benefits, and the best products for a subscription model. We also provide an overview of the German subscription commerce market and explain how businesses can participate.

What’s in this article?

• What is subscription commerce?
  
• Subscription commerce in Germany
  
• What are the benefits of subscription commerce?
  
• What are the best products and services for a subscription model?
  
• How German companies can use subscription commerce
  

What is subscription commerce?

Subscription commerce—or subscription-based ecommerce—is a business model where products or services are delivered on a regular basis for a recurring fee. It is a special type of ecommerce that helps companies establish continuous revenue streams and long-term customer loyalty.

Subscription commerce can provide customers with flexible payment terms. Payments can be made monthly, quarterly, or annually, depending on the individual agreement. Typically, customers can manage or cancel their subscriptions anytime—online and hassle-free. Products and services will continue automatically until the subscription is canceled, without the need to place a new order.

Flexible subscription models in digital commerce

Subscriptions predate digital commerce, with more traditional examples including subscriptions to newspapers and magazines or gym memberships. However, the contract models involved in modern subscription commerce are significantly more flexible and varied. The classic subscription model is now more adaptable, replacing rigid subscription periods and automatic renewals with flexible alternatives.

Now, customers can often decide how often they want to receive a product or service and in what quantity. Subscription periods and payment intervals can also be adjusted to suit the individual. These flexible subscriptions are also known as “soft subscriptions.”

Subscription commerce in Germany

In Germany, subscription commerce has grown to become a permanent fixture of ecommerce. More and more, customers use subscriptions for products and digital services. In turn, businesses increasingly rely on recurring revenue. The data below provide an overview of the current market situation in Germany.

Subscription prevalence

Around 55% of internet users pay for online services in Germany. Over 14% of online shoppers use paid services and offerings more than once a month. On average, German households have more than four digital subscriptions—the most popular are for video and music streaming services.

Monthly spending averages €55 per customer. Customers’ average budget is €34, which can help explain why 59% are interested in discounted bundles. A study conducted in 2022 across eight countries in Europe showed that 42% of subscription customers are not aware that they are using a subscription model.

Subscription cancellation

While 9 out of 10 subscription commerce customers in Germany are satisfied with their subscriptions, only 4% intend to take out a new subscription within the next six months. Fewer than 20% are considering canceling a subscription. German customers want to cancel 1.28 subscriptions on average.

Business growth

German companies are investing heavily in subscription models. In a 2024 study, 76% of companies surveyed said they would invest in this area in 2025. A third were planning to introduce a new subscription service, while 53% wanted to expand their current range to include additional products and services.

What are the benefits of subscription commerce?

Subscription commerce offers a wide range of benefits for businesses and customers. Here is an overview of the key benefits:

Benefits for businesses

Stable revenue streams

Subscriptions can give businesses continuous and predictable sources of income. Unlike one-time purchases—where demand can fluctuate—subscription models provide companies with regular payments, which can make planning and liquidity management easier. This stable revenue stream can also allow companies to manage their financial resources, plan investments, and grow long-term. Plus, a constant flow of cash can put them in a better position to react to fluctuations in the market. This can be a major advantage, especially when market conditions become unpredictable. Businesses can also save on the costs of acquiring new customers by ensuring long-term customer relationships.

Customer loyalty

Subscription models can promote strong customer loyalty. Regular interaction with a product or brand can help foster lasting relationships. This emotional connection can also help make long-term subscribers less sensitive to price. Consequently, businesses can benefit from lower churn and longer customer relationships.

Personalized offers

Subscription commerce allows companies to personalize their services and offerings to the specific needs of individual customers. By regularly analyzing customer data, businesses can offer customized recommendations and packages that satisfy customers’ personal needs. This can create a better customer experience and improve satisfaction.

Better inventory and production planning

Regular and predictable orders can allow companies to plan their stock levels and production processes more efficiently. By better understanding demand, they can fine-tune their warehousing costs and avoid bottlenecks or overstocks. This planning can help with production and marketing because companies can better assess which products and services will be in demand in the upcoming period.

Cross-selling and upselling opportunities

Subscription models offer opportunities for cross-selling and upselling (i.e., offering additional or high-ticket items). For example, a customer who has taken out a monthly subscription for care products might also be interested in an exclusive bonus item. This strategy can significantly increase revenue per subscription.

Benefits for customers

Convenience and time savings

For customers, subscription commerce is convenient and saves time. Customers don’t need to make repeat or regular purchases of the products they need. With reliable deliveries of everyday products, customers can also avoid stock-outs at physical stores.

Exclusive offers and discounts

Subscription commerce customers frequently enjoy discounts and special offers. They also occasionally get access to exclusive or limited products and services that are only available to subscribers. This can create additional incentives to take out subscriptions.

Flexibility

With subscription commerce models, customers often get to decide how and when they want to receive their products. They can adjust delivery intervals, quantities, and what’s included to suit their current needs. This flexibility can encourage customers to purchase subscriptions without being bound by rigid contracts. This can be particularly useful for customers with needs that fluctuate according to the season or time of year.

Easy management

Subscriptions are user-friendly and generally easy to manage. Customers can manage their subscriptions via online platforms where they can amend, pause, or cancel deliveries anytime. This ease of use makes the service transparent and gives customers the flexibility to adjust their subscriptions to suit their needs.

What are the best products and services for a subscription model?

The subscription model can be applied to many product categories:

• Everyday items: Groceries, cosmetics, and household goods are products people need on a regular basis. A subscription can provide a reliable supply of these items.
  
• Food and drink: Subscription boxes for snacks, tea, coffee, and fresh food items are also popular. These items are consumed regularly, and customers enjoy the convenience of home delivery.
  
• Digital products and services: In the digital sector, subscriptions for streaming platforms, software, and digital newspapers and magazines are well established. Businesses that offer these subscriptions can experience greater scalability and lower production costs.
  
• Fashion and apparel: Customers can get shoes, clothing, and accessories delivered on a regular basis. Some models allow customers to keep selected pieces, while others operate as lending systems with the option to return and exchange items.
  
• Hobby and leisure products: Subscriptions for books, arts and crafts materials, toys, and pet accessories serve niche demands. This can help businesses establish long-term relationships with customers who have clearly defined interests.
  
• Tech and gadgets: Currently, there is a trend of subscription models for smart home products, health devices, and tech accessories, such as charging devices and cables. This also includes gaming subscriptions for game consoles.
  
• Fitness and health services: Gyms and online platforms offer subscriptions for live courses, apps, and nutrition advice. These subscriptions can also include fitness trackers or dietary supplements.
  

How German companies can use subscription commerce

Using subscription commerce requires a strategic approach and thorough planning. Here are a few of the most important steps:

Analyze target groups and select products

Targeted group analysis is the foundation of successful ventures into subscription commerce. You should know the best products or services for a subscription and your potential customers’ specific needs. For example, this includes knowing how much of a product or service they consume. This can help you understand the frequency of demand. You should also research avenues for personalized or exclusive offers that can add value.

Select subscription model and pricing

The next step is to decide on the best subscription model for your products. One option is the classic fixed subscription with regular deliveries at set intervals. Alternatively, you can offer a flexible “soft subscription” model, where customers can choose their own frequency and quantity.

You should also consider how much flexibility you want to give your customers. This can depend on how important it is to your company to be able to plan earnings. To appeal to as many customer groups as possible, you can offer differentiated price models. Flexibility when it comes to payment methods is important for satisfying customer needs and making subscription acquisition as easy as possible for your business.

Integrate billing systems

Managing recurring payments and subscriptions requires an effective billing system. You need to ensure your infrastructure is capable of processing regular payments and managing your subscription model. This is where Stripe Billing can help. Billing makes it easy to set up a subscription management tool and add flexible pricing options.

Billing also allows you to accept and manage recurring payments worldwide without the need for complex integrations. It offers features that can help companies minimize customer churn by collecting missed payments. Tools like these can help prevent revenue loss and keep cash flow stable. At the same time, they can strengthen customer loyalty through smooth payment processing.

Make subscription management simple

Customers want to easily manage their subscriptions. Therefore, a user-friendly subscription management platform is important to the success or failure of your model. Customers should be able to adjust their delivery intervals and pause or cancel their subscriptions anytime without having to go through a complex process. A transparent and easy-to-use tool can increase customer satisfaction and loyalty.

Personalize offerings

Because of regular interaction, subscription commerce allows you to personalize your offerings. Businesses should be capable of adapting their offerings to the specific needs of their customers based on analyses of customer data. For example, you can offer customized product packages or exclusive offers that have been personalized for customer preferences.

Use marketing strategies for customer acquisition

A successful subscription model requires a strong marketing strategy. This can help you acquire new customers and maintain existing ones. This strategy can include social media campaigns, influencer marketing, and targeted advertising. Special promotions—such as discounts for new customers or exclusive offers—can also help raise awareness of your subscription model. Another option is referral programs where existing subscribers recruit new customers in exchange for rewards.

Foster long-term customer loyalty

You shouldn’t just be aiming to attract new subscribers. You should also make sure your customers remain loyal to your company long-term. An important part of this is continuous communication. You should react to your subscribers’ wants or problems as quickly as possible.

Automatic retention tools—such as those integrated into Stripe Billing—can also help you keep customers who want to cancel their subscriptions or bring back those who have already left.