‘Most of us are worried about the cumulative cost’: Australians caught in subscription trap
The average number of subscriptions held by each Australian household is rising each year, and with this comes the creeping concern that we are paying too much.
This is according to Deloitte Media and Entertainment Consumer Insights 2024 report, released on Monday morning, which shows Australians spend an average of $63 on digital subscriptions, with each household having an average of 3.3 subscriptions each.
Both these figures have creeped up over recent years – from an average of 2.3 subs per household in 2021, and a cost of $57 a month, in 2023 – which Deloitte puts down to a number of streaming video services both raising prices and launching ad-based tiers, increasing overall subscription volume.
These subscriptions are primarily music and streaming video – with those two categories making up 85% of all subs.
Not surprisingly, this creep has consumers worried.
75% of respondents are worried about the cumulative cost of having multiple subscriptions, which the report suggests is “an indicator that could drive cutbacks next year”. This seems especially pertinent where considering the break-down of those average costs into generations.
Gen Z, who earn the least, also spend the most on subscriptions, with the average Gen Zer shelling out $88 a month for digital subscription.
The spend decreases with age: Millennials spend an average of $82 a month, Gen X spend $55 a month, Boomers $48, and what Deloitte charmingly refers to as ‘Matures’ are spending just $42 a month, less than half than Gen Z.
Worryingly, 54% of Gen Z feel they overspend on digital media.
Rising costs and the diluting of streaming options means that consumers are likely to switch between subscription offering, with close to half of viewers changing their paid subscription video stack over the last six months.
This switching is highest in gaming subscriptions, which Deloitte reasons is because “younger generations are more inclined to explore new options and switch subscriptions to find the best fit”.
Given the seasonal nature of sport, it’s not surprising to see viewers drifting to and from those services as seasons begin and end.
At the end of the day, Australians may be concerned about the price rises, but they ultimately accept them.
Deloitte sees a rosy outlook for streaming video, regardless of the hurdles.
“Despite increasing prices, the crackdown on account sharing, and the introduction of ad-based tiers, most of us expect to have the same number of SVOD subscriptions next year.”
Keep up to date with the latest in media and marketing
Linkedin
Have your say