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Woman receiving delivery.

Subscription boxes are the gifts that keep on giving. It’s so simple and so irresistible; punch in your credit card information and for a small, regular fee, a package shows up at your doorstep each month filled with fun new treats.

There’s no denying the subscription box business model is incredibly popular. There are thousands of services to choose from offering a wide range of products. But with every new trend comes yet another way for people to spend money, so it’s important for savvy consumers to make sure they’re spending wisely.

We talked to some financial and consumer experts on the draw of subscription box services. We aimed to figure out why these things are so darn addictive and what you can do to make sure you aren’t spending more than you should on these fun treats.

The Growing Popularity Of The Subscription Box

Subscription boxes have seriously blown up in recent years. From meal kit delivery services to boxes filled with clothes based on your style preferences, the subscription trend has proven to be extremely popular with consumers and extremely lucrative for the companies that sell them.

“If we just look around, we can see that consumers value convenience and time and are willing to pay for it. This is evidenced by the explosion of services that eliminate daily hassles from our lives – we now can get our groceries delivered, meals planned and delivered (we don’t even have to select the ingredients), whole outfits delivered without ever picking out the clothes or even browsing a website,” said Veronica L. Thomas, Associate Professor of Marketing at Towson University and expert in consumer psychology.

What About These Services Attracts Consumers?

M. Kim Saxton, Clinical Professor of Marketing at Indiana University’s Kelley School of Business, said there are three reasons why people like subscription services:

  • Convenience: “Some items you need on an ongoing basis – dog food, razors, vitamins, etc. It’s just easier to have them sent automatically. It makes it easier for you. This is the logic behind Amazon Subscribe and Save.”
  • Variety: “This is the most popular reason people buy subscription boxes. They like variety and don’t want to do the work to shop for it. Instead, they want someone to do that work for them. They then pick and choose what to keep. These are the food and clothing boxes like Stitch Fix and Blue Apron.”
  • Special access: “Some people like to have the ‘inside’ track. They are willing to pay up front to get special rewards.”

Leslie Tayne, a financial attorney and author of “Life & Debt: A Fresh Approach to Achieving Financial Wellness,” echoed that convenience is a big factor in the popularity of these services.

“We live in a time where convenience is everything. So much of what we do has and is becoming digitized. And we as consumers love the concept of pushing a button and having what we need show up at our door 2 days (or less!) later,” she said.

Another reason? People like getting mail.

“People enjoy gifts because of the surprise and anticipation. Receiving a subscription box every month resembles receiving a gift – except that you’re paying for it,” said Laurice Wardini, manager and writer at Subscriptionly.net.

Why We Stay Subscribed (Even When It’s Not Working Anymore)

There’s nothing wrong with subscribing to one of these services to try it out and see if the boxes are useful to you. But we often sign up, enjoy it for a while and continue to stay subscribed even after the initial excitement fades.

“Most people realize after a few months of receiving the boxes, the novelty has worn off or the products are no longer useful to them. How many aluminum water bottles with catchy phrases does one actually need?” Tayne said.

So why continue to pay for a product or service that’s no longer useful to you?

Because the price is automatically deducted from your account, you may become complacent in continuing to pay for it. The amount also may not be significant enough to make an effort to cancel the subscription. Additionally, because the payment is structured so it generally bills on a monthly basis, you likely aren’t thinking about the long-term cost.

“It feels as you’re not spending as much when you divide the expense to months,” Wardini said.

In our minds, paying a small amount of money each month might not seem like a big deal even if it adds up to be a significant chunk of change.

“Companies work to facilitate this desire for convenience and ease the financial burden (something known as ‘the pain of payment’) by lowering consumers’ perceptions of cost via weekly or monthly billing,” Thomas said.

Are They Ever Truly Worth It?

Sometimes subscription boxes deliver items that (while are nice or fun to have) you probably wouldn’t have bought yourself if you had to make the conscious choices to go to the store and buy each item individually. Even though you might be getting a good deal on items you could easily do without, you’re probably not spending your money very wisely by staying subscribed.

However, that doesn’t mean that they’re all a waste of money. In fact, many people greatly benefit from these services.

For example, if you’re someone who values a nutritious home-cooked meal but doesn’t have a lot of time during the week for grocery shopping or food preparation, a meal kit delivery service can be extremely beneficial.

Subscription boxes that deliver something you already use regularly can be similarly useful because they’re providing you a product you already pay for while making the process of buying it easier. Subscription boxes that regularly deliver personal care products (such as razors) are a good example of this.

There can also be a lot of value in buying something simply because it brings you joy. For example, if you enjoy experimenting with different makeup and beauty products, a cosmetic subscription box can be a great purchase even if it’s not necessarily something you need.

How To Make It Work For You

The key to deciding if a subscription box is money well-spent is by thinking about whether it’s worth it to you. Do you get a lot of use out of the products? Does it make your life easier in a significant way?

“Consider how often you use the items that come with it. If you are only liking or utilizing one or two items out of the whole box, it may be a waste. Since typically you don’t choose what comes in your package, the items may not be what you would use. Or you’ll only use something for a short amount of time,” Tayne said.

Tayne advised that consumers should consider how the subscription is affecting their budget and if that money could be going to something more useful. Essentially, you need to ask yourself if the products you’re receiving are worth the money you’re spending to stay subscribed to the service.

“Consider the value of the items that you use and the ones you don’t. Be sure that you are getting your money’s worth and not overpaying for unused items,” Tayne said.

Know When To Quit

Don’t be passive about the money you spend. If what you’re paying for your subscription service doesn’t feel worth it anymore, you probably need to click “unsubscribe.”

“Examine if you are getting your money’s worth or not, and if you’re not, it takes minutes to cancel. Just be sure to look at your monthly statements to make sure after you cancel you are no longer being charged,” Tayne said.

Once you’ve made that decision, an unexpectedly difficult step can be the actual act of ending your subscription. It can be easy to put it off or to say “I’ll just wait for next month’s box to come and then I’ll cancel.” But the longer you put it off, the more money you spend.

“While, yes, subscription boxes provide a fun treat each month and they’re well-suited to our modern mindset of convenience, not being able to choose what’s coming to you most likely means we’re paying for more than we use, which means it may be time to click unsubscribe!” Tayne said.

This Post Has 4 Comments

  1. I found your article very informative!

    What are the subscription services that you think will become even more popular and will never go away? Why do you think so?

    1. Thanks, Liz! I think it’s hard to say which subscription services are going to stick around. There’s so much competition and all of these spaces whether you’re into food, music, movies and TV or clothing. I think the ones that are likely to stick around are the ones that have a niche consumers are really into that they’ll pay for on a regular basis. People have limited funds, so while I think that there’s space for multiple players for different tastes, you do have to find your segment of the market.

  2. Great article Molly!

    I particularly like what you said about passivity. That’s how I feel about the subscription box industry. It creates a customer base that is passive about their money and their participation in the program which eventually turns into disappointment and churn. While we can’t deny that subscription boxes disrupted the retail and e-commerce industry, I also think that the churn rates are showing that they are not going to stand the test of time. I believe the role of subscription boxes was to prepare the average consumer for new and unique ways of shopping so that other, more personalized technological solutions could come along.

    Just my two cents, loved the article!

    Veronica Lieberman
    Make It Hapin

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