Subscription Overload: The Rise of Recurring Revenue
The number of products and services we sign up for is ballooning as almost every industry latches onto the subscription business model. This is because businesses can make more money up-front and over time by selling subscriptions and building loyalty. They can also mine subscribers for data to tailor their services—just like streaming services collect information on what you watch and use it to suggest new titles.
From Car Washes to Taco Bell, Subscriptions Are Everywhere
Car washes are doling out memberships. Pet toys and treats come in recurring bundles. More of us are subscribing to meals, as the market for food delivery boxes grows. The personal care and grooming market has pivoted to subscriptions: Razors, makeup, and personalized hair-care products arrive monthly in the mail. Even Taco Bell offers a subscription service—$10 a month for a taco a day.
The Reality Check: We're Spending More Than We Think
The average consumer spends $219 on subscriptions every month, per C+R Research. But we're only aware of about 40% of that spending. Customers' forgetfulness when it comes to subscriptions can boost companies' revenues by up to 200%, according to economists at Stanford and Texas A&M.
Some people are feeling overwhelmed by the number of subscriptions they have. Now there are app services that track and clean up your subscriptions for you—and offer their own premium tiers...as a subscription.
What to Do About Subscription Fatigue
Here are a few tips:
Review your subscriptions regularly. Check your bank statements or credit card bills to see what you're paying for.
Cancel subscriptions you don't use. If you haven't used a subscription in a while, it's probably time to cancel it.
Set up alerts for when your subscriptions are about to renew. This will give you a chance to cancel before you're automatically charged.
Use a subscription management service. There are a number of apps that can help you track and manage your subscriptions.
The Future of Subscriptions
Subscriptions are here to stay. But as consumers become more aware of subscription fatigue, businesses will need to find ways to make their subscriptions more valuable and easier to manage.