Customer Expectation Lessons from Subscription Services

What can a report on subscription services teach us about consumer expectations, customer retention, and reducing churn?

business hand typing on a laptop keyboard with Subscribe homepage on the computer screen follow subscription membership social media concept.
Voice of the CustomerInsights

Published: July 28, 2023

Rhys Fisher

global consumer study has revealed precisely what customers expect from their subscription providers, with the findings shedding light on the growing sophistication of consumer demands.

Commissioned by subscription management specialists Recurly, 6,000 respondents (1,016 from the UK) were surveyed about their subscription service preferences and expectations.

The findings reveal that despite the financial instability of recent times, UK consumers are still flocking to subscription suppliers in their droves, with an estimated 44 million new subscriptions over the last 12 months.

However, some customers are starting to feel the pinch. The data highlights that consumers are becoming more selective with their subscriptions, with almost half (47%) cancelling at least one service within the past year due to a general need to reduce their own expenses (37%) or because of price increases (36%).

The subscription sector is fertile but temperamental, like being flush in a casino but knowing that you’re only ever one bad hand away from losing it all.

But how can companies protect themselves against the whims of frugal consumers, and ensure that they not only attract but retain their customer base?

Personalisation is power

A familiar word in the customer experience sector in recent times, and for good reason; the ability to personalise an individual’s experience is no longer an added bonus, it is expected.

Consumers want to control how, when, why, and to what they subscribe; and they expect companies to cater to these desires.

74% of respondents listed personalisation as one of their top reasons for subscribing.

This is evidenced in the findings of the report, where 74% of respondents listed personalisation as one of their top reasons for subscribing.

Within the bracket of personalisation, features like the ability to upgrade or downgrade subscriptions as needed (83%), customise plans and pricing (81%), and add items when required (78%) all featured as key priorities.

Moreover, 65% of those surveyed admitted that flexibility to customise their plan based on what they use would lead to them changing their minds about cancelling a subscription.

By giving consumers the flexibility to adapt their subscription service to suit their lifestyles, companies are enhancing their chances of retaining customers.

If you want a loyal customer, reward customer loyalty

It may seem obvious, but in a competitive market, providing a quality product with a high level of service is not enough – customers want to feel valued and are more than happy to look elsewhere if the grass appears greener.

When asked what would make them feel like a valued subscriber, 60% of consumers highlighted the need for loyalty incentives. Indeed, over 80% of respondents revealed that they would stay subscribed if there were loyalty incentives involved in the subscription.

Cheaper subscriptions with longer “lock-ins” can help reduce churn by 42%.

Interestingly, when looking at the specifics within customer loyalty there is a clear pattern in the type of incentives and rewards that consumers prefer.

Financial rewards, such as lower subscription prices (76%) and discounts (74%) are markedly more popular than physical items like gift cards (36%) and unique products (46%).

Another notable finding from the report is the correlation between loyalty incentives and churn rates, with the results revealing that providers who offer cheaper subscriptions with longer “lock-ins” can help reduce churn by 42% – securing prolonged engagement with improved recurring revenue streams.

If you love something, set it free

‘Settings’, ‘Manage my subscription’, ‘Cancel subscription’, ‘Are you sure you want to cancel?’, ‘Are you really sure?’, ‘Are you really really sure?’, ‘No problem, call this number between 5:48am and 6:17am on Thursdays, but the line will probably be busy’.

We’ve all had to deal with the mild irritation (for those of a cooler demeanour), or the fury-inducing hell (for those who are prone to a bout of the temper tantrums), when it comes to cancelling a subscription.

So it is unsurprising to see ease of cancellation (84%) topping the list of the factors most likely to attract new subscribers, reflecting that so-called ‘dark pattern’ practices that make it very easy to sign up but extremely difficult to cancel are not beneficial to subscriber relationships.

77% of respondents stated that they would be more likely to subscribe if it was easy to cancel the subscription.

Whilst in the past, this method may have paid dividends with many customers giving up on cancellation out of frustration, consumers are far savvier these days – researching a company’s cancellation policy before signing up for their subscription services.

This consumer behaviour was highlighted in the report, where 77% of respondents stated that they would be more likely to subscribe if it was easy to cancel the subscription, with 71% admitting that the option to pause the subscription would make them more likely to subscribe.

The findings also revealed that it is essential for companies to allow customers to cancel their subscriptions online and avoid the dreaded cancellation phone call, with 59% of respondents stating that they would likely unsubscribe if they must make a telephone call to cancel a subscription.

In discussing the findings of the report, Theresa McEndree, CMO at Recurly, commented: “It’s promising that there is still a huge consumer appetite for subscription services, but it’s clear that consistency in both pricing and loyalty are the stand-out criteria for success in a fiercely competitive arena.

“The cost of living is hitting consumers hard and they aren’t willing to stick around unless they are getting the best content from streaming services or compelling products from retailers—all for a great price.”

MyCustomerUser Experience

Share This Post