Consumers’ use of automated payments for subscription services has grown steadily, but growth has been particularly substantial over the past two years. This behavior aligns with consumers’ increased appetite for subscription services, with many now subscribing to TV streaming, online gaming, digital music, online software and connected devices, consumer retail products, financial services, education and training and a host of other services.
More than 80% of consumers have at least one subscription, up from 72% in February 2020, but the number of consumers with subscriptions leveled off during the first half of 2021, according to “Optimizing Subscription Payments,” a PYMNTS and FlexPay collaboration based on a survey of 2,195 consumers in the United States.
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The most popular category of subscriptions is streaming services. That has held a relatively steady rate of customer acceptance over the past year, though, meaning that other product categories have accounted for much of the market’s recent growth. The faster-growing categories include online gaming services, digital media subscriptions and consumer retail product subscriptions.
Although the number of consumers with subscriptions has leveled off, those who do have subscriptions are continuing to pick up more. The average consumer had 2.3 types of subscriptions as of July 2021, nearly twice as many as the average consumer held in February 2020. This is prompting subscription service providers to examine how they can entice and retain consumers who already have at least one subscription.
When paying for their services, subscribers are inclined to tap traditional banking products. Thirty-eight percent of consumers who pay for subscriptions say they use debit cards to do so, making it far and away the most common payment method. Credit cards come in second place (28%), followed by PayPal (17%), digital wallets (9%) and bank account transfers (7%).