SMEs encounter a renter’s dilemma
Many years ago when I was a young journalist living in London, back before the days of CDs and DVDs, we got our music from LPs and cassettes and our films from VHS tapes, rented from the local newsagent or, if you lived somewhere really fancy, Blockbuster.
Obviously, things have changed a lot since then although the one gadget in common back then and now was the TV, even if it has gone through many modifications over the years. I was the proud possessor of a TV and a VHS player. To be more accurate, I was the proud renter of both items through a company called Radio Rentals which, as far as I know, didn’t really do much business renting radios.
Anyway, the point is that I had not bought the TV or VHS player outright but preferred to pay a weekly subscription to use them. Nowadays, that too has changed and we tend to buy our TVs and there’s no need for a VHS or DVD player anymore as we stream films and TV programmes to our TVs, usually through a subscription to the likes of Netflix, Now, Disney+, Apple TV, Amazon Prime etc, etc.
The reason for this trip down memory lane is because of something I read in a story on the MicroScope website concerning the growing willingness of SMEs to sign up to subscription services.
According to research by Uswitch.com, 86% of UK business owners viewed subscription services as a benefit for cash flow and almost half of UK businesses had adopted some form of service. But what caught my eye was a sentence in the article highlighting the preference of business owners under 35 for a subscription model compared to a one-off transaction.
“The advantage of pitching subscription services is that most users have adopted them in their personal lives, so they understand the model and its benefits,” the article noted.
The Netflix of…
Uswitch argued people had become accustomed to paying a monthly fee for services through the adoption of video-on-demand platforms such as Netflix, and music services such as Spotify and Apple Music, along with similar options for gaming and food. It’s probably fair to say that, with the exception of those who opt for Dodgy Box and equivalents, the subscription model is widespread and familiar. As such, it is likely to become increasingly acceptable in the SME world.
This isn’t a new argument but whereas before it was still in the realms of the hypothetical, it’s now increasingly everyday reality. The interesting part of this shift is that it was adopted by you and me first, ahead of its implementation in the business sphere. This also means that you and I are more likely to understand this model when it is adopted in our workplace because we’ve been living with it for quite a while already.
I can’t end this article, however, without noting that there is a small counter movement towards owning music and, to a lesser extent, films and TV shows (through DVDs) rather than renting them. LPs are back and, more improbably, cassettes might be resurrected from the dead too, despite their inferior sound quality and propensity to get chewed up by cassette players.
The revival in vinyl has come at a cost, however, because the pricing of LPs seems so much higher than when I was buying them way back when. So much so that I wonder if anyone might consider starting up a subscription service for them?
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