Contrasting customers’ perceptions for pay-per-use vs. subscription : implications for communications

Abstract

This dissertation carries out a causal study between intention, regret, and attitude towards two different pricing strategies; the subscription model and the pay-per-use model. The constructs were used to determine the viability of offering a combination of the two strategies in high-end health clubs. The two local health clubs considered for the purposes of this study were Cynergi and StudioFifteen.

Due to the lack of empirical research on the introduction of a pay-per-use pricing scheme in the health club industry it seemed like an interesting and useful study to conduct. The use of a quantitative study comprised of two separate questionnaires that allowed the researcher to determine the two groups’ mindsets regarding the three constructs in relation to each pricing strategy. The study was aimed at university students and young full-time workers who are typically too occupied to attend a health club on a daily basis. Therefore, this study targeted participants between the ages of 18-41.

The results revealed that intention was fairly similar amongst the two groups, however, attitude was deemed to be overall more positive towards a pay-per-use model, whilst respondents anticipated feeling a greater sense of regret if they did not meet their intended usage levels when paying a subscription.