Savvy Brits use subscriptions to navigate cost of living

413 Views

Subscriptions are playing an essential role in helping UK consumers to manage their finances and maintain an element of normalcy during the ongoing economic crisis, according to new research released by Zuora.

The research – which surveyed 2,000 adults in the UK – discovered that 83% of those surveyed agree that subscriptions are a good way to maintain an element of normal life. Furthermore, 86% believe subscriptions enable them to enjoy activities and services that they wouldn’t necessarily want to spend a lump sum on.

According to the poll, subscriptions are also proving to be a useful money management tool for many. In fact, when asked directly about finances, 84% of those surveyed believe that subscriptions enable them to worry less about their finances and 80% agree that it is easier to keep track of their spending using subscription services.

In terms of what they like the most about subscriptions, the ability to cancel whenever they like is the top-ranking feature consumers (26%) value the most. This is closely followed by the ability to get the services they require with minimal effort (20%). Other reasons for investing in subscriptions include that they are considered a feel-good treat (15%) and that they are both cost effective and flexible (14%).

Home entertainment, music and gaming subscriptions come out on top

Certain subscriptions are outperforming others in the current market. Home entertainment services – such as Netflix, Disney+ and Now TV – are seeing the most investment, with 4 in 5 (82%) respondents saying that they subscribe to at least one service in this category. Music (52%), gaming (30%), banking (27%) and gym (26%) subscriptions are also proving popular.

Coffee (14%), plant (11%), alcohol (12%) and dating app (12%) subscriptions are seeing less traction. However, one in 10 subscribers are still signing up to these services,

Unsurprisingly, over the last year, there have been some changes to spending habits, and certain subscriptions are viewed as more dispensable than others. The data shows that food (16%), gym (13%), music and book (12%) subscriptions have all been impacted the most by the cost of living, with more subscribers cancelling in the last 12 months.

As well as being the most common subscription service, home entertainment is also the least likely to have been cancelled within the last 12 months (only 7%). However, interestingly, this is the subscription that respondents are most likely to be considering cancelling currently (11%). Conversely, the subscriptions that respondents are least considering cancelling at the moment are alcohol, plants, coffee and dating apps (only 5%).

Londoners lead the subscription race

Regionally, London is the UK subscription ‘capital’, with the average Londoner signing up for at least 3 subscription services each. In fact, the data shows that 25% of Londoners have at least 5 subscriptions currently. In contrast, East England subscribes less than any other region, with 1 in 4 (24%) respondents only owning one subscription.

In terms of age group, millennials (25 – 34-year-olds) are the biggest subscribers with one in four (26%) having 5 or more subscriptions.

For the majority of consumers, cost (59%) is the leading consideration when selecting which subscription to invest in. This is particularly true for women (63%) over men (55%).

Interestingly, over one in five (22%) respondents admitted that the primary reason for cancelling one subscription was to spend money on another.

Subscription usage remains strong

In the majority of cases, respondents say they are utilising the subscription services that they pay for. In fact, over half use home entertainment (59%) and music (58%) every day. Meanwhile, over 70% of those surveyed use their subscriptions – including online fitness, beauty, coffee, alcohol and dating apps – at least weekly.

With this in mind, it’s hardly surprising that 51% of respondents say that their subscriptions being a part of their everyday life is the primary reason that they keep them. This is followed by it being a cost-effective way to enjoy a product or service (31%) and cutting costs in other areas (14%).

“As purse strings tighten and consumers try to cut costs, ‘non-essential’ services are often the first to go. This research has proven that subscriptions categorically do not fit into this bracket.” said John Phillips,  General Manager, EMEA at Zuora. “Instead, subscriptions are a cost-effective, convenient alternative to one-off purchases. They can enable consumers to achieve an element of normalcy even in the current challenging economic landscape. By contributing little and often – instead of laying down a large lump sum – subscribers are able to continue to travel, enjoy the latest tech and stay healthy.”