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11:00 PM 23rd May 2024
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Subscription Surge - The Hidden Cost Of Convenience

 
Image by Markus Winkler from Pixabay
Image by Markus Winkler from Pixabay
Over the past ten years there has been a dramatic surge in the subscription market, with services including fresh food, beauty products, pet food and video streaming becoming increasingly popular. This trend shows no signs of slowing, with subscription-based businesses projected to be worth £1.8 billion by 2025 and the average Brit currently spends £500 per year on their subscriptions.

Technology advancements, social media exposure, and the pandemic lockdowns have all fuelled this massive growth. The convenience of regular deliveries, potential savings, and personalised offerings have driven the subscription model's popularity, resulting in a steady stream of boxes arriving at our doorsteps.

However, new research from Citizens Advice has revealed a darker side to this subscription boom. Over 13 million people, or 26% of UK adults, have accidentally taken out a subscription in the past year. These unwanted subscriptions, covering everything from fitness apps to food delivery and magazine subscriptions, have cost consumers a staggering £688 million over the last 12 months. This marks a significant increase from the £306 million reported at the end of 2022.

Citizens Advice warns that the issue of 'subscription traps' is deepening. The most common reason for these accidental subscriptions is auto-renewal without the consumer's knowledge, accounting for 40% of cases. Close behind, 39% of individuals signed up for free trials but forgot to cancel before the subscription kicked in. Alarmingly, nearly one in four (24%) believed they were making a one-off purchase, only to find themselves locked into a recurring payment.

Stephanie Hood, from TheCMO.com says:
"Take a proactive approach in managing your subscriptions. It's easy to lose track of the services you're subscribed to, especially with the sheer number of options available today.

"Regularly reviewing your subscriptions can help you identify any unwanted or unused services, potentially saving you hundreds of pounds each year.

"Many people don't realise how much they're spending on subscriptions they don't use. A thorough review can reveal opportunities to cut costs and redirect those funds towards more important financial goals.

"As living costs rise and many people find their expenses outstripping their income, it's crucial for consumers to take charge of their finances. Businesses that depend on customers forgetting to cancel free trials are taking advantage of busy, financially strained individuals, and this practice is unacceptable.

"Consumers should have the option to choose whether their subscriptions auto-renew and decide if they want to continue after a free trial."


Stephanie’s advice:
Review subscriptions regularly to identify and cancel unused services
Set reminders to cancel free trials
Monitor bank statements for unexpected charges
Set the money aside from the subscriptions into a savings pot