How The Subscription Model Put An End To Ownership And Conscious Spending

The endless cycle of the subscription model.

Remember when you used to buy a CD or purchase a razor without needing to commit to a monthly delivery box? Well, those days are long gone. Over the past decade, subscriptions have had a chokehold on the consumer experience. From music and movies to clothing and fitness apps, we have all become victims of a subscription economy. Worse yet, most of us are paying this price without realizing how much it really costs.

On the surface, subscriptions seem to be a win-win. For a company, it’s relatively easier to retain a customer paying $10 per month indefinitely than to convince them to just pay $75 upfront. Meanwhile, for the consumer, $10 per month just instinctively feels cheaper than $75, making it seem like a good deal. Not only that, a subscription model also gives consumers the choice to stop using a service at any time. Straight up buying a service often obligates consumers to keep using it, even if they don’t like it. A subscription model, on the other hand, means that consumers can stop using a service even just a month later, with only a $10 loss. This is exactly why Spotify has so quickly replaced buying individual albums, and Netflix has replaced DVD collections. But subscriptions aren’t just for a few entertainment or tech softwares anymore. According to one 2024 report, the average U.S. consumer now has 7 to 10 active subscriptions at any given time. Businesses love this model because subscriptions guarantee a predictable, recurring stream of revenue. 

But that $4.99 here and $12.99 there can add up to hundreds per year if you forget about them. Many consumers don’t even realize how much they’re spending until they run their bank statements. A 2023 survey from C+R Research found that 74% of Americans have been subscribed to a service that they no longer use. On average, people underestimated their monthly subscription spending by over $130. 

Many consumers fall into what experts have described as “subscription fatigue”: the psychological and financial stress from juggling too many ongoing services. Aside from budgeting pressures, subscriptions take up a lot of brain power for the average person. Whether it’s remembering to cancel a free trial before it charges, choosing between five streaming platforms, or feeling guilty for not taking advantage of the fitness subscription you’re still paying for, these seemingly small stresses can be overwhelming. 

With this in mind, companies often make it easy to sign up and difficult to cancel subscriptions by hiding cancellation buttons or requiring you to call customer service. As a result, the shopping experience is now passive, as our charges renew automatically every month. The option of whipping out a credit card and making a conscious choice of saying no is gone. In many ways, this system benefits businesses more than it does consumers. Instead of planning for a few large purchases, people now need to track dozens of micro-payments. If income is inconsistent, as it often is for freelancers, students, or hourly workers, it’s easy to incur overdraft fees or credit card debt from small recurring charges.

Moreover, there is a tension of ownership. Even though we rent songs, movies, and software apps, we don’t actually own them. If you cancel, your access will be revoked almost immediately. These short-term subscription models aren’t inclusive. For low-income consumers, the need to subscribe, whether to apply for jobs using LinkedIn Premium or access homework through online textbooks, can be a barrier to equity. And while many services offer free trials, these often require a credit card, which many people don’t have readily at hand. As a result, subscriptions favor consumers who are highly online, organized, and financially literate. While some know how to cancel on time, set reminders, or use third-party tracking apps, most people struggle to juggle all these financial responsibilities.

But it’s not all bad news, and you don’t have to cancel every single one of your subscriptions. Here are five quick tips to sift through your subscriptions:

1. Check your accounts: Review your bank and credit card statements for the past three months. Make a list of all your active subscriptions.

2. Categorize by necessity: Which ones do you use often? Which ones could you cancel?

3. Use a subscription tracker: Apps like Rocket Money, Truebill, or even a spreadsheet can help you see everything in one place.

4. Set calendar reminders: If you start a free trial, set a notification a few days before it ends so you can cancel if needed.

5. Rotate subscriptions: Use one streaming service for a couple of months, then cancel and switch to another. You don’t have to pay for all of them all the time.

Subscriptions can be convenient and even cost-effective when used wisely. However, as consumers, we need to continually ask ourselves if we are paying for value or simply forgetting to cancel.