Companies transitioning to a subscription model face several challenges. Firstly, there is an initial drop in revenue as the company moves from a one-time purchase model to a recurring revenue model. This can be a significant financial hurdle for many companies. Secondly, there is a rise in expenses as the company needs to invest in new systems and processes to manage the subscription model. Thirdly, the company needs to manage the customer relationship in a different way, focusing on customer retention and satisfaction over the long term rather than just making a single sale. Finally, the company needs to adapt its product or service to fit the subscription model, which may not be straightforward for all types of products or services.
Subscription services have grown revenues 8X faster than the S&P500 and 5X faster than US retail sal...
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