Car Subscription Study Suggests Service Has Mainstream Appeal
- Insights from FINN Help to Inform New BCG Study Identifying the Key Trends and Success Factors for Rapidly Growing Market
- Average User Age is About 40 years old
- 78% Did Not Drive a New Car Before
- 62% Live in Places with Fewer than 500k Residents
- 26% Subscribed to a Battery Electric Vehicle in the Past 12 Months
NEW YORK, Jan. 10, 2023 /PRNewswire/ -- FINN, the leading car subscription platform in the U.S. and Germany, today announced that sanitized and aggregated data on consumer patterns and demographics it provided has been featured in a study by leading management consulting firm Boston Consulting Group (BCG) focused on the car subscription market. Co-produced with BCG’s Center for Mobility Innovation and titled, “Driving Success in Car Subscriptions”, the study explores best practices for success in the sector and, uncovers the benefits afforded to car subscription companies, as well as OEMs and dealerships by the emergence of this business.
Key themes from the study include: how car subscriptions are paths to EV ownership and sales; how car subscriptions are an e-commerce gateway for the retail auto industry; and, the consumer appeal of car subscriptions among first-time car shoppers.
Based upon its conversations with FINN leadership the BCG study outlines “Three Rules for Subscription Success”:
Rule #1: Probe Customers’ Product Priorities
- Price counts more than contract term.
- Product variety drives conversions.
- For multibrand providers, vehicle type outweighs brand.
- Customer experience is paramount.
Rule #2: Know the Subscription Customer
- Customers are younger than buyers, but the age range is broader than expected.
- Customers are value-minded.
- Customers aren’t just big-city dwellers.
- They’re not just consumers, but small-to-medium sized enterprises, too.
Rule #3: Master the Unit Economics
- Pursue scale.
- Apply profitability levers tied to vehicle sourcing, pricing and vehicle utilization, fleet management and operations, marketing, and remarketing.
- Manage risks, especially around residual values and fleet financing.
“FINN is pleased to have been asked by BCG for insights for its car subscription market success study,” said Max-Josef Meier, CEO and Co-Founder, FINN. “The data shows car subscriptions are becoming the fourth pillar of how people access new vehicles, next to leasing, financing and buying. Together with our OEM and car dealership partners, we are building an environment in which the entire industry, as well as our customers, benefit.”
FINN first launched in Germany in late 2019 before expanding to the United States in 2022, currently available to residents in 12 states in northeast USA including New York, New Jersey and Massachusetts as well as Washington, D.C. During its first six months in the U.S., FINN grew its subscription business twice as fast as in Germany in its first year, while also growing to 27 U.S. fleet partnerships. FINN recently announced that it has reached €100 Million in Annual Recurring Subscription Revenue (ARR).
For additional information found in the report please visit bcg.com.
FINN is a car subscription platform united by its purpose to make mobility fun and sustainable by providing all-inclusive, easy-to-book and quickly available car subscriptions. The car subscription platform offers transparency in pricing, as well as comprehensive insurance, maintenance and 24/7 customer support and roadside assistance. The company facilitates consumer adoption of electric vehicles and offsets the CO2 expended for every mile driven across its active fleet of vehicles. FINN makes driving a car seamless and convenient: with just a few clicks, customers can subscribe to a car that will be delivered straight to their door in just a few days.
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