Study: Cost could slow subscription economy

While subscription services continue to launch for everything from meal planning to beauty products, one new report indicates there could be a slow-down ahead. That slow-down, according to data from Fetch, will come because of the costs of subscription services.

by Kristina Knight

The new report, The Mobile-First Consumer and the Subscription Economy, found that a growing number of consumers, which still happy with their subscription services, are also wary of the total cost for the different services to which they subscribe.

"Subscription pricing models are at the core of almost every disruptive service we see today, from streaming video and music to news and gaming and now beauty, grocery, and retail," said Guillaume Lelait, CEO, Fetch US. "It is not a surprise that consumers are beginning to reach a state of price sensitivity. Marketers of subscription services must become more strategic in the ways they acquire and retain customers and in how they price and package services."

The data shows that 75% of subscription service members currently subscribe to more services than they did a year ago, with video subscriptions leading the way. Researchers also found that most subscription service members "tolerate advertising" in a trade-off for a lower monthly subscription cost.

But perhaps most interesting is that mobile subscribers - and mobile is the preferred device for the path to subscription - decide after their first trial of a service whether or not they want to continue. Meaning that mobile-first services must provide value and create on-going interest within their first subscription box.

The full Fetch data set can be accessed here.

Tags: advertising, ecommerce, Fetch, mobile marketing, subscription economy, subscription service trends