The food and restaurant industry is focusing on subscription services. Various types and forms of subscription products are being launched one after another, ranging from coffee to side dishes.
According to industry sources on 14th, Starbucks Korea launched its subscription service "Buddy Pass" in December last year. Buddy Pass is a service that Starbucks has launched exclusively in South Korea. By paying 7,900 won per month, customers receive a 30% discount on manufactured beverages and food products every day at 2 p.m. Other benefits include the provision of free delivery coupons.
Starbucks conducted a trial operation for two months prior to the launch of Buddy Pass. A Starbucks representative said, "During this period, we analyzed the consumption patterns of Buddy Pass subscribers, and it was found that the amount spent in stores and the frequency of visits increased by 61% and 72%, respectively, compared to before subscribing." They added, "The benefits received by subscription service users averaged 23,300 won per month, which is three times the subscription fee."
As Buddy Pass received a positive response, Lotte GRS also revamped its subscription service. Lotte GRS recently launched a renewed version of its monthly subscription service, named "Ogle Pass," for its donut franchise brand Krispy Kreme.
Ogle Pass is available in two types: donut or coffee subscriptions, each costing 20,000 won. First, customers can have three original glazed donuts for 63% off the regular price, available for use 10 times a month. The regular price for three donuts is 5,400 won, meaning they can be used for just 2,000 won. An Americano (M) can also be used 25 times a month at a price approximately 81% lower than the regular price, making it cheaper than low-cost coffee brands at around 800 won per cup.
NongHyup Economic Holdings has been operating a periodic delivery subscription service called "Monthly NongHyup Flavor Selection" since April 2023. This includes the "Seasonal Premium Fruit Selection" (50,000 won), "Kimchi Flavor Selection" made from 100% domestic agricultural products (20,000 to 40,000 won), and the health functional food subscription service "Health Flavor Selection" developed by a traditional herbalist (30,000 to 40,000 won).
From this year, there are plans to expand the items to include rice, meat, and traditional liquor. As of last year, subscription service sales amounted to 10.5 billion won, a 150% increase compared to the first year of its launch in 2023.
There are mainly three types of subscription services: membership type, periodic delivery type, and rental type. The membership type includes services such as Buddy Pass or Ogle Pass, where subscribers pay a monthly fee to use the service.
Monthly NongHyup Flavor Selection is of the periodic delivery type. It is a service that regularly delivers products based on the amount paid for a set period. The rental type involves paying a monthly subscription fee and then returning the product after the contract period, which includes water purifiers and furniture rentals.
According to the KT Economic Management Research Institute, the domestic subscription economy market was valued at approximately 40 trillion won based on 2020 data, and it is expected to grow to 100 trillion won this year. The reason consumers continue to seek subscription services is due to the advantage of being able to conveniently use frequently purchased products at lower prices.
In particular, with food periodic delivery services, the intermediate distribution process is minimized, allowing customers to receive products in fresh condition. Each company can secure a fixed customer base through subscription services. This is known as the so-called "lock-in" effect, and they can provide customized services through customer data analysis.
An industry insider noted, "The key to the success or failure of subscription services is how many diverse options are provided to consumers and whether services tailored to individual consumer preferences are being offered."
The growth of the food subscription service market is a global trend. According to the market research firm Miraculous Market Research, the food subscription service market is projected to grow at an average annual rate of 8.6% from 2024 to 2031, reaching a scale of $12.75 billion (approximately 18.4 trillion won) by 2031.