Subscription business model

A business model that provides ongoing access to a product or service in exchange for recurring payments. It relies on continuing customer relationships rather than a single sale.

Recurring billing: An arrangement that automatically charges a customer at regular intervals for an ongoing product or service. It turns continued access into a predictable sequence of payments.
Software as a service: A model for delivering software over the internet, typically through a subscription. It is a prominent form of subscription business built around continuous software access.
Pay-as-you-go pricing: A pricing structure in which customers pay for each unit consumed or service used. It ties charges to usage rather than a fixed recurring access period.
Recurring revenue: Income a business expects to receive repeatedly from ongoing customer agreements. It is the financial stream that subscriptions are designed to establish.
Customer churn: The rate at which customers stop using or paying for a product or service. Each cancellation removes future revenue and raises the burden of replacing customers.
Subscription box: A recurring delivery service that sends curated physical goods to customers. It applies recurring payments to a sequence of tangible product shipments.
One-time purchase: A transaction in which a customer pays once to acquire a product or service. It produces an upfront sale instead of revenue tied to continued renewal.
Net revenue retention: A measure of recurring revenue retained from existing customers, including upgrades, downgrades, and cancellations. It shows whether existing subscribers expand or shrink in value over time.
Customer lifetime value: An estimate of the total value a customer generates over the duration of a business relationship. It measures how much recurring revenue a retained subscriber can generate.
Streaming media: The delivery of audio or video content over a network for playback as it arrives. Subscription services commonly sell ongoing access to streaming catalogs.

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