Subscriptions are no longer just a niche player in the industry—they’ve become a force shaping the way businesses operate and how consumers buy products and services. But as we head into 2025 and beyond, the focus is shifting. 

While acquisition rates are on the decline, going from  4.1% in 2021 to 2.8% in 2024, subscription companies are now prioritizing retention and building subscriber loyalty—because, in a saturated market, keeping customers is just as critical as attracting them.

Our very own Rachel Sheriff, Chief Customer Officer, and Jeff Sheldon, Chief Architect at Recurly, sat down with product leaders from Yahoo, Amazon, academia.edu, THG, and more to discuss how you can build a scalable strategy to secure the loyalty of your customers from the word go.

💡 Check out the full report or keep reading to get the highlights. 

Market growth and where we are now

According to Forbes, the global subscription market value is projected to reach $1.5 trillion this year, with the average American household already spending $273 monthly on subscriptions. From streaming to SaaS platforms, businesses across every sector are leveraging this model to achieve steady, predictable revenue alongside stronger customer relationships.

Yet the landscape is crowded. “Everybody wants to get into subscriptions,” says Prashant Ramarao, SVP of Engineering, Product AI Research and Architecture, at Yahoo. New players enter daily, making it increasingly difficult for brands to differentiate themselves. Success requires more than offering another monthly service—it demands innovation, a compelling value proposition, and, most importantly, loyal customers.

Challenges and lessons learned in 2024

Scaling subscriptions in a competitive market isn’t without its hurdles. Here are the key obstacles you must overcome and actionable solutions.

1. The ease of cancellation

With new regulations like the U.S. Federal Trade Commission’s one-click rule, consumers now demand and expect the ability to cancel subscriptions easily. While this rule eliminates dark pattern practices, it adds extra pressure on companies to improve their systems for cancellations and potential reactivations. 

Did you know that 20% of acquisitions are actually from re-engaged subscribers? Businesses must provide not only outstanding experiences but ensure their cancellation process is smooth and welcoming for future re-engagements.

2. Customization vs. standardization

How do you strike the perfect balance between personalized subscriptions and operational scalability? Customers increasingly expect services tailored to their preferences; however, over-customization can lead to inefficiencies and complexity on the business side.

Bart Coppelmans, Senior Director of Product Management at HERE Technologies, explains that scalability is key to facing this challenge. Start by identifying a base-tier subscription package and provide premium add-ons that match customer needs. This lets companies meet individual needs while ensuring their operations remain efficient.

3. Meeting expectations for convenience

Today’s subscriber isn’t just looking for value—they expect seamless experiences. Whether it’s the ability to stream content on every device or receiving a meal kit box precisely when expected, customers are demanding effortless interactions across all sectors. To thrive, you need to prioritize user-friendly features like automation, high-quality service delivery, and personalized onboarding.

Rethinking subscription strategies

The next stage in subscription growth isn’t about throwing generic offerings to see what works—it’s about fundamentally rethinking what today’s customers value and how innovation can meet those demands.

  • Innovate with personalization and AI: Artificial Intelligence (AI) is proving a game-changer for personalization and customer insights. By analyzing user behavior, AI helps you tailor offerings, predict churn, and proactively engage with customers before dissatisfaction sets in.

  • Keep a subscriber-first mindset: A smooth, hassle-free onboarding process is critical for building loyalty from day one. Simplifying sign-ups with automation, providing clear and personalized recommendations, and creating straightforward account management interfaces are all must-haves. Make sure all channels have a simplified sign-up process, no matter the device or channel they are coming from.

  • Use analytics to track preference: Behavioral data is gold in today’s subscription economy. By analyzing how customers interact with services, companies can uncover valuable insights that guide both marketing and product development strategies. Whether it’s identifying patterns of seasonal use or discovering underutilized features within your product, acting on data leads to better customer experiences and stronger retention rates.

Why retention is the new growth

Retaining a customer isn’t just cheaper than acquiring a new one—it also fosters long-term growth and has the potential to turn satisfied subscribers into loyal advocates. But the competitive subscription landscape in 2025 will leave no room for complacency. Businesses must deliver value consistently, meet rising customer expectations, and innovate to stay ahead.

The path forward lies in understanding what subscribers truly want and creating personalized, adaptive experiences that keep them engaged. By balancing innovation with operational scalability and leveraging tools like AI, businesses can thrive in a customer-centric market.

💡 Keep reading the report to get more insights.