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23 November 2011

Gartner analyze recommends subscription model like that of kalmstrom.com

Gartner, Inc. claims to be the world's leading information technology research and advisory company. Today I read one of the Gartner reports, and since it was about subscription models I found it very interesting.

What is a subscription?
Gartner defines a subscription business model as a model where a product or service is paid for on a continuous, periodic basis. The model gives the customer ongoing access to the product/service for the life of the subscription agreement. Gartner also remarks that the model fosters a degree of customer experience or customer loyalty that is unique and different from what you get with a purchased product.

kalmstrom.com Community ‒ the right decision
This month I have written two blog posts about the kalmstrom.com subscription model, one about the two year anniversary for kalmstrom.com Community and another one about the statistics of that duration. In both posts I could conclude that transferring to a subscription payment model was a good decision, and now Gartner has come to the same conclusion about subscriptions in general.

Expanding payment model
Gartner predicts a strong increase of the "subscription economy". Especially companies who provide products that can be delivered electronically or digitally should consider this alternative. Gartner recommends businesses who are not offering subscriptions yet to put a priority on assessing this alternative now, to not miss the opportunity.

Subscription models raise new concerns
The kalmstrom.com team has long ago learned that the subscription payment model brings some new factors into the customer relations, and Gartner also points out that the subscription business models raise new concerns regarding managing subscriptions and subscribers. To kalmstrom.com this closer relationship to the user organizations is nearly always something positive. We were aware that the relation would change when introducing the Community, and we looked forward to it.

kalmstrom.com on the right track
As I said in the earlier blog posts we are very satisfied with our transfer to a subscription model, but of course it feels good to know that world leading analysts recommend others to do just what kalmstrom.com has already done. We are also happy about all Community Members who understand and appreciate the benefits of subscribing to kalmstrom.com Office applications instead of buying them.