One of the best ways to gain customer loyalty? Offer a subscription service. And that’s what Goldman Sachs is recommended that Apple do: Offer an Apple subscription service that includes premium content, certain services and iPhone products. All in the name of growth and loyalty.
Where have we seen this model before? Amazon Prime, which has seen strong growth and loyalty. And as PYMNTS reported earlier this month, Amazon is even getting college kids hooked on the product so they become customers for life.
“This strategy would help Apple fend off smartphone commoditization and position it well versus Amazon and Alphabet as content shifts to streaming,” analyst Simona Jankowski wrote in a note to clients Sunday (Oct. 30). “In our view, Apple needs to invest with urgency and scale in a tightly integrated content strategy.”
This comes as the iPhone is becoming less dependable as a growth source. But this Apple subscription service would help ward off competitors.
Jankowski’s group recommends a plan that, on top of the smartphone’s own monthly subscriptions, for $50 per month, the bundle might include Apple TV, Apple Music, freemium model access to the iTunes library, plus rewards as the customer uses the subscription. This would allow Apple to take on varying competitors, like Samsung and Amazon.
In addition, Goldman recommended that Apple begin producing its own unique content similar to Netflix’s “House of Cards” and Hulu’s “The Path.” Goldman also said Apple could find a special, untapped opportunity in offering live sports content in partnering with sports networks, like ESPN and Fox Sports. Much of this could be an add-on offering of $10 per month through the subscription.