Business Model Innovations in Subscription-Based Commerce

  • Authors

    • Ritu Sharma Department of Commerce, University of Hyderabad, India. Author
    • Kavita Nair Department of Commerce, University of Hyderabad, India. Author

    Published 2026-01-12

  • Subscription-Based Commerce, Business Model Innovation, Recurring Revenue, Digital Platforms, Customer Lifetime Value, Platform Economics; Service-Dominant Logic

    Issue

    Vol. 1 No. 1 (2026)

    Section

    Articles

    How to Cite

    Sharma, R., & Nair, K. (2026). Business Model Innovations in Subscription-Based Commerce. International Journal of Commerce, Finance and Digital Economy, 1(1), 26-40. https://worldcometresearchgroup.com/index.php/ijcfe/article/view/39

  • Abstract

    The subscription business has become one of the most radical business models of the digital economy changing the paradigm of value creation, delivery, and capture in industries. In contrast to the old-fashioned transactional models based on the one-time purchases, the subscription commerce refers to recurrent revenue, long-term customer relations and experience delivery on the constant basis. It has facilitated this by transformations to digital platforms, data analytics, cloud computing, and payment infrastructures that increase the capabilities of reducing transaction friction and increasing personalization capabilities. This manuscript explores the business model innovations in subscription-based business with the following query: Structural, strategic, and technological changes underlying sustainable competitive advantage. This paper synthesizes the current sources on subscription economics, value creation on a platform and the management of customer lifetime, and presents the integrative conceptual framework that connects the aspects of innovation to the outputs of performance of the firm. The paper explores the problem of how firms redesign value propositions, revenue structures, cost designs, and customer interaction processes through a mixed-method orientation based on conceptual modeling and secondary data analysis. The results show that the effective subscription model is based on such aspects as the dynamic pricing, modular service design, data-driven personalization, and ecosystem integration, as opposed to fixed offerings. Further, the findings confirm that digital-based companies are not the only ones to be innovative in subscription commerce but that the traditional industries are adopting it more rapidly, including retail, media, software, healthcare, and mobility. The paper has added to the literature by defining subscription-based business model innovation as a process of continuous adaptive change and offers some actionable advice to practitioners aiming to scale subscription strategies to volatile markets.

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