Why Did TIER Launch a Subscription Model for Its myTIER E-Scooters?

Why did TIER, which operates in 160 European cities and has an estimated annual revenue of $205 million, decide to launch a subscription model?

Garima Singh

Product Marketing Manager

TABLE OF CONTENT

Update: TIER merged with Dott at the beginning of 2024, and in October 2024 the combined company announced that TIER would become Dott, with all vehicles moving to the Dott brand by early 2025 (Dott press release). This case study describes TIER's myTIER subscription as it launched in 2021.

Key takeaways

TIER launched a monthly subscription for its older myTIER e-scooters in 2021 instead of only selling them.
The goal was a stable, predictable revenue stream alongside the pay-per-use sharing business.
Giving older scooters a second life also supported TIER's climate-neutrality goals.
circuly powered the subscription pilot: checkout, recurring billing and subscription operations.

If you lived in a European city between 2018 and 2024, you probably either heard of TIER or used one to get from point A to B.

TIER Mobility was a Berlin-based startup founded in 2018. TIER developed, offered and operated a digital platform that offers micro-mobility solutions on a pay-per-use and rental basis.

They are constantly innovating their product line and “changing mobility for good” as highlighted by them.

When TIER decided to launch a new e-scooter model with replaceable batteries in the market, they decided to sell the old model to private customers.

The old TIER scooters were first seen in the market for purchase in November 2019. Reselling the old TIER scooters was an important milestone in order for TIER to become carbon neutral.

So even though TIER had a plan for their old scooters, why did they decide to launch a subscription model?

Building a stable revenue stream

TIER decided to launch a monthly subscription model for their myTIER scooters because they wanted a build a stable and predictable revenue stream.

Subscriptions are a great way to build a predictable and stable revenue stream.

Despite all the discussion about customer churn, subscriptions are and will remain a way to have better control over the company’s finances.

TIER launched a subscription business model in 2021, and in 2022 all their scooters are sold (rented) out already.

Becoming climate neutral

For startups like TIER, sustainability is not just a word used for PR but is often embedded in the DNA and, as a result, influences key decisions and operations.

TIER is fully committed to becoming climate neutral. To achieve that they go beyond reducing carbon emissions linked to charging and also include production, operation and transportation emissions.

By recycling and providing second life to their old generation scooters, they keep their scooters from ending up in landfills and thus directly reduce their carbon footprint.

Launch of a subscription model

Launching a subscription-based business model for a physical product is oceans apart from launching a digital subscription business. Automation of operations and collection of relevant data play a big role when it comes to scaling such a business model. What TIER needed was someone who could help them with the launch of their pilot project. circuly provided the know-how, technology and expertise required in launching and scaling a subscription business model for physical products.

Frequently asked questions

Does TIER still exist?

TIER merged with Dott at the beginning of 2024 and the brand moved to Dott, with the transition expected to complete by early 2025.

Why do micromobility companies offer subscriptions?

A monthly subscription turns one-off scooter or bike sales into recurring revenue, keeps the vehicles in the company's fleet, and makes it possible to refurbish and re-rent them later.