Announcing the 2022 State of Subscription Commerce report from Recharge

Are you also excited to know about the E-commerce report and stats? So let's dig into this topic by first looking at what subscription commerce is. You must be tired and annoyed of traveling and then paying monthly bills for your favorite services and products. Why worry when this can be quickly done for you automatically? For that, there is Subscription Commerce. It is a business model through which we purchase and sell different products, goods, and services

This model has immensely made purchasing easier and technically made life more leisurely.  When we analyze the state of E-commerce, we start by reflecting on 2020 as it was the quarantine period, and people spent more time at home than ever. It was the time when everything was being done from home, including work, attending school as online classes, and, of course, online shopping.

The era of Subscription Commerce:

As a result, with the passing years, subscription commerce saw dramatic growth throughout the world. That is when subscriptions come up with excellent stability for consumers.  Also, in 2021, brands experienced colossal growth in advance order value.  Upon Analysis, it was seen that Recharge touched over 12000 merchants that served25 million of customers across almost the whole world.

Impact on Subscription Commerce: 

Although Brick and mortar services reopened and led to in-person shopping by consumers, subscription commerce continued to grow. It wasn't the same as in previous years but was consistent and balanced across all GMV cohorts and all verticals.

Customer growth in different verticals:

Here, we will be focusing on seven key categories:

Vertical Breakdown:

Customer Growth

  • Personal and Beauty care

                      25% growth

  • Fashion and clothing

                      13%  growth

  • Health care

                    34% of growth 

  • Home goods

                      39% growth

  • Food and Beverages

                      41% growth

  • Pets and Animals

                      64% growth

            (Highest level of growth )

Subscriptions grew their overall customer base by an average of 31% across all verticals. This Analysis shows that customers and consumers worldwide are embracing subscriptions in their lives.

Monthly recurring revenue and average order value by verticals :

Overall, MRR has increased by over 89% in recent years, with a 138% MRR increase in health and wellness; this indicates how much consumers are relying on subscriptions for their health and self-care routine. 

The average order value grew about 11%.

Although people have started going out for different activities, subscriptions still resonate in large numbers.

Lifetime Value:

The next Analysis is of lifetime value which roughly increased by about 15%.

Customers' lifetime value can be increased to 30% if brands enable SMS communication.

Gross Merchandise Value:

In this part of the Analysis, we made a cohort breakdown for the merchant pool.  It was analyzed that the higher the merchant's annual GMV, the more integrations will be utilized. As there was an increase in GMV, an increase in the use of emails and SMS was also found.  It is also fundamental Analysis that higher GMV doesn't translate as a higher lifetime value and higher average order value as in Analysis higher LTV and AOV were seen in cohort with much lower GMV all that due to higher engagement of customers and more active subscribers.

Customer Retention:

Customer retention is the supreme factor in a merchant's Subscription. Retained subscribers indicate brand loyalty as they continue contributing more to recurring revenue and increasing lifetime value.  You see, starting months of Subscription are a crucial window when the brand or company makes an initial positive impression and establishes trust.

Subscription Commerce Report

The E-commerce report 2022 tells about the expected growth of the E-commerce industry by 11trillion dollars in the coming years.  Similarly, in 2022 sales are also likely to reach 5 trillion dollars. As merchants observe customers' demands, more and more online brands are popping up, leading to customer competition.  According to an E-commerce report, the merchants spend far more than they gain to gain immense customer traffic and achieve goals. 

Brands that rely on short-term performance marketing will have the most challenging time competing in the increasingly crowded retail sector. By now, it seems that brand creation will be at the core of 2022 marketing plans for the most successful firms around the globe.



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