Luxury without Commitment: The Next Frontier in Subscriptions

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Back in 1987, you might have got a cassette single of Springsteen’s “Pink Cadillac” delivered in the mail through your music subscription service. Thirty years later, there’s a subscription service that will deliver an actual Cadillac to your doorstep. This isn’t just a story about Cadillac: it’s a story about the future of commerce.

“BOOK by Cadillac,” a subscription service announced in the first week of 2017, is a genuinely new take on the auto business. For $1,500 a month, subscribers to the service get “app-enabled access” to drive a current-year, premium-trim Cadillac of their choice, “delivered via white-glove concierge.” Once your Caddy’s delivered, it’s yours to drive as much as you like, wherever you want. The subscription fee pays for insurance, maintenance, roadside assistance — everything but gas.

Once you’re ready for a new Caddy, a tap in the app will summon a new car that suits your mood, up to 18 times a year. Ready to slip into something more comfortable for the winter? Swap your sporty ATS for a roomy Escalade. Order up a distinguished CTS when you’re ready to spend more time out on the town. For now, the service is only operating in the New York metro area, but Cadillac has “plans to debut in other markets” soon.

Cadillac’s marketing chief Uwe Ellinghaus says the service is “an innovative option targeted at a growing class of luxury drivers searching for access to various cars over time, dependent on their individual needs.” From our perspective, it’s even more than that: it’s a key moment in the evolution of subscription commerce. Here are three commerce trends that Cadillac’s new service gets exactly right:

• It’s innovative. Bewildering the older folks is never all bad for marketers, and “BOOK by Cadillac” is likely to do just that. For many people of a certain age, “throwing money away” on a vehicle you’ll never own is good reason not to lease a car — much less subscribe to one by the month. Younger consumers, by contrast, are just not interested in car ownership — but they are definitely interested in having a convenient, on-demand experience of driving. This subscription service offers exactly that.
• It’s luxurious. Subscription commerce has now decisively shed its down-market reputation. It’s no longer just cassette tapes and romance novels that come month-to-month: today, premium brands are realizing the benefits that come from taking control of long-term customer relationships. Pay-as-you-go models are making everything from haute couture to private jets available to more people, more of the time.
• It’s experiential. We talk about “the end of ownership,” as younger consumers drive an overall shift away from mere possessions and toward fulfilling experiences. And for some people, driving a brand-new Caddy would be a very fulfilling experience indeed. Access isn’t just about lowering costs: after all, $1,500 a month is considerably more expensive than leasing or renting a Cadillac. What luxury-minded subscribers get with “BOOK by Cadillac” is more than a car: they get commitment-free access to an experience. By talking about the “white-gloved concierge” as much as they talk about the cars, Cadillac is selling the value of the total experience, not just the merchandise.

Learn more about the future of subscription commerce; read our white paper, The Subscriptions Generation.