Subscription psychology

A not-quite-blog post; a few thoughts from a Twitter thread…

Woke up thinking about the psychology of subscriptions like the goddamn nerd I am.

One seemingly simple question is when it makes sense — or just feels right for whatever reason, logical or not — to go for monthly vs annual payment plan.

Would you rather subscribe to something for say $5 / month or $60 / year?

I’d usually go with $5 monthly because it feels like such a low number, almost a tiny impulse buy…but if the annual plan was $50 instead I’d likely go with that b/c then I feel like I’m getting a deal.

The weird thing is that if annual was $99, I might actually be more likely to consider! At that point feels like there’s a reason it’s higher, not just different frequency but a more premium plan…& psychologically feels more like a one time commitment vs a decision each month…

Anything you subscribe to where you opt for annual not for the savings but simply because it feels like a lower stress thing?

Or maybe feels more like you’re “all in” and more committed to taking advantage of the thing you’re paying for?

At higher numbers of course the thinking shifts.

$25/m vs $300/yr I’m less likely to go annual b/c the # is so high. Though may not go monthly either…unless it’s a ~donation~ in which case I have several! But those feel more like an obligation than something I’m buying

Similarly I feel a lot more comfortable keeping a Patreon or Substack (etc.) contribution going for a few bucks a month indefinitely, vs something like…a coffee of the month, or niche movie sub, where I’m more inclined to constantly evaluate if I’m getting enough “value” from it

And then of course there are subscriptions that are either a literal utility or that feel like one, a notable case of the latter being Amazon Prime…

Amazon has done a fiendishly great job of obscuring the value of Prime as a multi-layered thing that makes it hard to evaluate

(Maybe you recognize this internal monologue: “hmm maybe I should cancel Prime, I haven’t been ordering that much stuff…ah but there have a couple movies on there I’ve been meaning to watch…also y’know Prime Now does come in handy sometimes…guess I’ll stick with it for now…”)

So, there’s a lot out there about pricing psychology and e.g. why different rates sometimes feel right or wrong in terms of the value they deliver and so on.

But what I’m realizing is just how often subscriptions aren’t even based on “value” in an economic sense at all!

You very well may subscribe to something:

  • Out of a sense of duty or obligation (patronage, donations)
  • For a sense of belonging (memberships)
  • Because something feels like a utility you have to have for whatever confluence of reasons…

At work, subscriptions are core to our business model. Personally, I subscribe to many things and even think about the economics quite a bit.

But I don’t often think about my own psychological patterns or hear a lot about others’ …I think it’s interesting to consider!