An Industrial Paradigm Change: Is Subscribing the New Buying?

Abstract

Prominent market leaders are encouraging subscriptions rather purchases of machines, for instance. In response, a growing number of suppliers of industrial products are considering enhancing their portfolios with subscription offerings, promising value added, such as increased productivity or better predictability. Buyers will consequently have to weigh the benefits against the risks, e.g., of data security or dependence. Current literature examining subscription business models focuses on the suppliers of such offerings. There is, however, need for research that provides guidance to buyers considering, implementing and using subscription offerings for industrial products. We contribute to this subject by exploring enablers and challenges of subscription offerings for industrial products based on 16 semi-structured interviews with experts from several industries. This article provides initial insights into a buyer’s internal transformation in conjunction with subscribing, thus making it valuable to both buyers and suppliers of such models. Furthermore, we add to procurement and subscription literature by examining subscription offerings from the buyer’s point of view.