Super Subscriptions π¦ΈββοΈπ¦ΈββοΈπ¦Ήπ½ββοΈ
This past week, Amazon announced it was adding Grubhub delivery to its Prime subscription (Read the news about Amazon and Grubhub here). The goal of Amazon Prime (and other subscription services) is to make the subscription so pervasive that it's sticky. Don’t like Prime movies? Ok, but you love free Grubhub delivery. If you don’t need feature X and want to cancel, you realize you still need feature Y and keep paying for the subscription.
This past week, The Wall St. Journal’s Christopher Mimms shared that companies like WhatsApp keep tacking on services to their apps—akin to what Amazon is doing with Prime (Read the full WSJ article here). Mimms calls these apps "super apps" because one app can do the work of many. While this approach is more popular in the Asian market, we can make a comparison to help us understand its power in the U.S. market. Imagine that instead of downloading Google's 10 apps, Google bundled them into one.
Much like a subscription service that offers a wide variety of benefits, a super app gives the app maker a competitive advantage. If you’re going to download an app, you’ll likely pick the super app. The ol’ fashion software world operates this way, too. For example, you need a free email service. Since you already use Google for its advertising services, you start using its free email service.
If Mr. Mimms had asked me, I’d have suggested he write about super subscriptions. Similar to what we’re seeing with Amazon Prime and Grubhub, software services are ballooning with features and become chockablock with offerings and inescapable. Yes, apps are powerful—but they are a subset of software, and part of a larger trend where companies keep expanding to become platforms. There’s an old horror movie called the The Blob. The blob is a monster that expands across water, and in our case, it is a software company that expands and expands and kills other startups. (If this were a movie, the startups would be played by precocious college kids.) We’ve chatted about subscriptions (a search on our site for this term produces 79 results) and platforms (214 results) before. The intersection of these two is super subscriptions. Salesforce.com and Amazon likely add a new service to their subscriptions every year. While Google is not technically a subscription service like Prime, in many ways it feels like one; it just keeps expanding the offerings of its free subscriptions.
Bridge uses this strategy, too. We have traditionally offered brands Product Syncing, and recently added Wholesale Ordering. We want to keep adding new features to the subscription. To help us accomplish this, the Bridge team recently pitched new, exciting business ideas, which we’re working on.
A question arises: when do we include a feature in the existing bundle, and when do we charge for it separately? How did Prime decide to include Grubhub for free rather than charge for it? There are a few factors that determine this, and a simple answer is that a new service may be bundled with others in order to increase adoption and determine its value. For example, Bridge recently added an invoicing system. We can’t bill for this yet as we’re still building its features. Plus, the goodwill it creates by giving it away may be greater than what we can charge for it.
We have some other projects on the horizon that may be included free as part of the Bridge subscription (membership!):
An online calendar
An online to-do list
Homework:
Think of popular subscriptions. It may be one that you use or don't. What has the entity that offers it done to expand its offering in the last two years? Has it added a new feature or service? What is that service, and did it charge extra for it?
As a reference, these are some popular online subscriptions: