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Consumer Frustration With Proliferating Subscriptions Is Real

It often feels like death by a thousand cuts.  Ten bucks here, twenty bucks there.  Those monthly subscriptions to everything from streaming services to home meal kit delivery can be exceedingly difficult to keep track of.  With an average of 12 monthly subscriptions per person (and as many as 17 for millennials, according to Statistica), the monthly costs add up quickly.  In fact, most consumers significantly underestimate the amount that they’re spending monthly on their subscriptions.  And since most charges are on a credit or debit card, they’re easy to forget about unless you scrupulously review your monthly statement line by line.

As part of a recent client project, we investigated consumer sentiments regarding the proliferation of subscriptions and, not surprisingly, found significant frustration.  Interestingly, this frustration took several forms.  Some consumers complained about unannounced price increases, which they only noticed months later.  Others noted that trial periods can be difficult to monitor, and then even more difficult to cancel.  However, the biggest challenge reported by consumers was simply keeping track of all their subscriptions and then canceling the ones that they are no longer using.  Personal strategies for managing these subscription fees varied, but few people were satisfied with the status quo.

To tackle this challenge, some consumers have turned to subscription management tools which have recently grown in popularity.  For example, Rocket Money, which acquired subscription management tool TrueBill for $1.2B in 2021, enables users to manage all of their subscriptions through a single interface and easily cancel those that are unwanted.  However, adding a new subscription service to manage your other subscription services hardly seems like an ideal solution.

And now the FTC is jumping into the fray.  Last week they proposed new rules to make it easier for consumers to cancel free trials, auto-renewals and subscriptions.  According to FTC Chair Lina M. Khan, “The proposal would save consumers time and money, and businesses that continued to use subscription tricks and traps would be subject to stiff penalties.”  While the provision has not yet been finalized, I suspect that these proposed regulations will be warmly welcomed by consumers.

Subscription companies are all too eager to sign up new customers, but often make it challenging to say good-bye.  These new rules from the FTC and a range of emerging online management tools are turning the tide and helping make it easier for consumers to finally break-up with their unwanted subscriptions services.