Growing "subscription economy" services in Korea
- 5 years ago
1. Time now for our "Life & Info" segment... where we focus on information useful for your everyday life whether you are in Korea or somewhere else in the world.
We have our business correspondent Kim Hyesung in the studio today to discuss a growing trend in Korea called the "subscription economy."
Hyesung, tell us more about the subscription economy.
Mark, the subscription economy refers to a business model in which companies provide regular products and services to consumers that subscribe and make recurring payments.
Netflix streaming services, Amazon e-books, Melon music services are some examples.
Subscription economy is not a new concept, it's an extension of monthly newspaper subscriptions, but the range of products and retail services online is growing rapidly.
There are shirts, shower towels and even blankets on offer.
Every month, this blanket subscription company will deliver a blanket to the customer's home.
It includes a mattress cover, blanket, and two pillow covers.
All sterilized and cleaned.
"It takes on average three-to-four hours to clean and dry the blankets at laundromats. But I can get clean blankets delivered with a click of an app. It's convenient and saves me time."
2. Are those blankets owned by the consumer or are they rented from the company?
You can either buy the blanket or rent it.
You can buy two sets of blankets for around 200 U.S. dollars, and get monthly cleaning services for 25 dollars a month. Or rent it from the company for 30 dollars a month.
If you calculate it, it's cheaper to buy the blanket set and own it if you subscribe to the service for more than six months.
You may wonder why would you want to borrow blankets, used by someone you don't know, even though it has been cleaned...but there is demand, like foreigners or students visiting Seoul for just a few months.
It's more reasonable for them to subscribe to it for a month or two, then you don't have to throw the blanket away. It's also clean.
Most companies offer various, personalized options under their subscription services, including a socks company that delivers three pairs of socks a month at 8 dollars, all different designs.
"Most of our customers are in their 30s and 40s. They can get it delivered easily and regularly. It's also about 30 percent cheaper than buying one pair at a time."
3. I see. What are some other industries that provide subscription services?
The traditional auto industry is also adopting subscription economy services via mobile apps.
Hyundai Motor Company started one in which customers can get three kinds of different cars, including sedans and SUVs for 600 dollars a month.
The auto company is in charge of cleaning and managing the car.
This is modeled after other countries that rent out expensive sports cars monthly on a subscription basis.
Global shoemaker Nike also launched a subscription services for kids aged two to ten. Four pairs of shoes a year and plans to expand it for adults who need to replace their shoes
We have our business correspondent Kim Hyesung in the studio today to discuss a growing trend in Korea called the "subscription economy."
Hyesung, tell us more about the subscription economy.
Mark, the subscription economy refers to a business model in which companies provide regular products and services to consumers that subscribe and make recurring payments.
Netflix streaming services, Amazon e-books, Melon music services are some examples.
Subscription economy is not a new concept, it's an extension of monthly newspaper subscriptions, but the range of products and retail services online is growing rapidly.
There are shirts, shower towels and even blankets on offer.
Every month, this blanket subscription company will deliver a blanket to the customer's home.
It includes a mattress cover, blanket, and two pillow covers.
All sterilized and cleaned.
"It takes on average three-to-four hours to clean and dry the blankets at laundromats. But I can get clean blankets delivered with a click of an app. It's convenient and saves me time."
2. Are those blankets owned by the consumer or are they rented from the company?
You can either buy the blanket or rent it.
You can buy two sets of blankets for around 200 U.S. dollars, and get monthly cleaning services for 25 dollars a month. Or rent it from the company for 30 dollars a month.
If you calculate it, it's cheaper to buy the blanket set and own it if you subscribe to the service for more than six months.
You may wonder why would you want to borrow blankets, used by someone you don't know, even though it has been cleaned...but there is demand, like foreigners or students visiting Seoul for just a few months.
It's more reasonable for them to subscribe to it for a month or two, then you don't have to throw the blanket away. It's also clean.
Most companies offer various, personalized options under their subscription services, including a socks company that delivers three pairs of socks a month at 8 dollars, all different designs.
"Most of our customers are in their 30s and 40s. They can get it delivered easily and regularly. It's also about 30 percent cheaper than buying one pair at a time."
3. I see. What are some other industries that provide subscription services?
The traditional auto industry is also adopting subscription economy services via mobile apps.
Hyundai Motor Company started one in which customers can get three kinds of different cars, including sedans and SUVs for 600 dollars a month.
The auto company is in charge of cleaning and managing the car.
This is modeled after other countries that rent out expensive sports cars monthly on a subscription basis.
Global shoemaker Nike also launched a subscription services for kids aged two to ten. Four pairs of shoes a year and plans to expand it for adults who need to replace their shoes