Subscription Services Market in Japan: Key Research Findings 2021

Domestic Subscription Services Market for FY2020 Attained 875,960 Million Yen (Total 7 Categories)

Yano Research Institute (the President, Takashi Mizukoshi) carried out a survey on the domestic subscription services market and found out the market trends of major/noteworthy categories, the trends of market players, and the future perspectives.

Transition and Forecast of Domestic Subscription Services Market (Total 7 Categories)
Transition and Forecast of Domestic Subscription Services Market (Total 7 Categories)

Market Overview

The market size of domestic subscription services (total 7 categories, fixed-term delivery services of food and cosmetic products included) calculated based on the payment by end users (consumers) for FY2020 has expanded by 28.3% to generate 875,960 million yen, and is expected to rise by 13.8% to reach 996,500 million yen by FY2021.

Many of the market sizes of each subscription service are still small, except for the categories of digital contents and fixed-term delivery services.

As a result of the researches carried out so far by Yano Research Institute on subscription providers, the challenge for growth of the services was “not successful in increasing the users despite improved awareness.” The COVID-19 pandemic in 2020, however, somewhat diversified the consumers’ lifestyle as well as workstyle, which has drastically changed the market conditions.

What was common to each category of the services in FY2020 was that new users not just registered for services but actually subscribed and experienced the services. The restricted various activities in the COVID-19 calamity seemed to have triggered people to have a try in using subscription services to find usefulness. By developing promotions such as a free trial offer, each service vendors has substantially increased new users. Therefore, not every service has not directly increased the users who pay for the service, but the service vendors have successfully guided the users from “being aware of to actually experience the service,” which was the very challenge for them to overcome. FY2020 became the year that triggered consumers to use subscription services.

Noteworthy Topics

Residence Subscription Providing Multiple Residences Attracting Attentions in COVID-19 Pandemic

The subscription services for multiple residences in various locations were supposed to grow as a niche market by people with specific purposes such as to build relationship with regional communities or to lead dual lives. However, the market has suddenly attracted attention as lifestyles and workstyles diversified in the COVID-19 calamity in and after 2020.

Immediately after COVID-19 infections started spreading, some service vendors temporarily reduced the occupancy rate, as people at first just stayed at home when telework has begun recommended. After June when the state of emergency was lifted, rising demand for working locations far away from urban areas led the sales at those vendors to recover. Those vendors with many residences just outside the urban areas have started exploring suburban and regional areas, which increased the number of residences held by service vendors.

In addition, another topic for FY2020 is the entry by accommodation service providers. As a measure against sharply plummeted inbound tourism demand stemming from the COVID-19 pandemic, some hotels started lending rooms at monthly payment. Nevertheless, such service is likely to end after the COVID-19 subdued and as accommodation demand recovers when the Olympic and Paralympic games are carried out.

Future Outlook

The COVID-19 pandemic has affected variously at each market since 2020, but it also triggered many services to acquire new users. While some services diminished their users in the calamity, the services are considered to expand when the pandemic are subdued and when the users rejoined after temporarily leaving the service during the calamity, synergistically with new users who became the members during the calamity.

For such reasons, the subscription service market as a whole is expected to grow stably, because many of the services are regarded to enter the phase for full expansion after the COVID-19 pandemic ends.

Research Outline

1.Research Period: January to March 202
2.Research Object: Subscription providers and their supporting service vendors (B2C), subscription business supporting service vendors (B2B), etc.
3.Research Methogology: Face-to-face interviews by the expert researchers, and literature research

What is the Subscription Service Market (Total 7 Categories)?

A subscription service in this research indicate an existing service that a user can use continuously without minding the period of time, the frequency, and the type, by paying an amount of money at regular intervals.

This research targets the following seven B2C services, i.e. for consumers: 1) Clothing/fashion rental 2) Food services (subscription of food, beverages and other products including dining at a restaurant) 3) Life related services (furniture, home appliances, daily necessities, domestic chores, etc.) 4) Residence (letting the users to change residences within a short period of time, or freely move and live in multiple residences by paying monthly. Share houses and monthly paid rental houses are not included.) 5) Language education (interactive contents and services, excluding correspondence education) 6) Digital contents (music and movies provided by paying monthly) 7) Delivery service (Applicable food, beverages cosmetics, etc. delivered using subscription platforms by paying a certain amount of money regularly.) The market size is calculated based on the payment by end users (consumers).

<Products and Services in the Market>

Clothing/fashion rental, Food services, Life related services (furniture, home appliances, daily necessities, domestic chores, etc., Residence (letting the users to change residences within a short period of time, or freely move and live in multiple residences by paying monthly), Language education (interactive contents and services,) Digital contents (music and movies provided by paying monthly,) Delivery service (Applicable food, beverages cosmetics, etc.,) subscription service vendors and their supporting service vendors (mainly for B2C, those for B2B are included as reference)

Published Report

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