Consumers Prioritize Products Over Memberships as They Cut Subscription Spending

As consumers reduce their monthly spending, PYMNTS data reveals many prioritize tangible products over certain services.

The Context

As consumers make difficult choices about which recurring payments stay and which they have to cut out, they are more interested in getting physical products than they are in more nebulous benefits such as the exclusivity that comes from paid memberships or the entertainment they can get from streaming services.

Certainly, consumers are looking for convenient ways to get items.

“Customers aren’t looking to go to 10 stores to buy 10 different things. If they can go to one place and they can get seven or eight of those 10 things, it just streamlines our lives,” President and CEO Brian Bogosian told PYMNTS’ Karen Webster in an interview. “It streamlines the time it requires to make these decisions.”

This preference for retail subscriptions may also come in part from how hard retail product subscriptions work to retain their customers.

“We want to ensure we’re delivering really amazing value,” Allison Vigil, president of Rocksbox, a monthly subscription service that rents jewelry to customers with an option to buy, told PYMNTS in an interview. “So we are really working hard to provide access to beautiful products through a curated assortment that meets customer needs for fashion jewelry. This must be as engaging and as seamless an experience as possible.”

By the Numbers

Research from PYMNTS’ new study “The One-Stop Bill Pay Playbook: Drivers of Consumers’ Bill Payment Priorities,” a collaboration with Mastercard, which draws from a December survey of more than 2,100 U.S. consumers, looks at which subscriptions people cancel first when they are unable to pay all their bills.

The survey found that retail subscriptions rank above other kinds of subscriptions on consumers’ lists of priorities. Some 1 in 4 retail subscribers would prioritize paying those bills in full over others, while fewer than 1 in 5 would do the same for membership subscriptions, and streaming subscriptions are first on the chopping block.

Plus, only 36% of those surveyed said that they would cancel their subscriptions for specific retail products as times got tough, while half of all consumers said they would do the same for membership subscriptions, and 55% for streaming subscriptions.

bill payment priorities