The average American now holds 5.2 subscriptions, spending about $69 (£55) per month, or $830 (£660) annually, according to a survey of 2,500 US consumers by subscription-bundling service Bango. However, nearly a quarter of respondents said they are spending more on subscriptions than they can afford, with the figure rising sharply to 41% among Gen Z participants.
As subscription costs rise, many consumers are willing to accept more advertisements in exchange for lower prices. The study found that 36% of Americans would tolerate twice as many ads if it reduced their monthly bill. This willingness is even higher among younger generations, with 46% of Millennials and 49% of Gen Z agreeing to the trade-off.
Major streaming services are seeing significant portions of their subscribers open to ad-supported tiers. For instance, 52% of Apple TV users, 48% of Disney+ users, 47% of HBO Max users, 44% of Netflix users, and 40% of Amazon Prime Video users said they would accept more ads for cheaper subscriptions.
The subscription model has exploded in recent years, with a 2023 Harvard Business School study finding that nearly 75% of direct-to-consumer companies now offer subscriptions. Services range from coffee and car washes to niche hobby boxes and even subscription management tools.
Some consumers are growing weary of the trend. Shonit Kaluri, 27, told The New York Times: “I don’t think there’s a single thing you can sign up for at this point that isn’t trying to give you a subscription. You end up wasting a lot of money through subscriptions because you think you’ll save money up front.” Kaluri previously paid $50 a month for a coffee subscription but found he did not use it enough to justify the cost.
The average cost of digital subscriptions has risen 19% since 2020, according to banking site DepositAccounts. This has prompted 37% of consumers to cancel at least one subscription in the past six months. Services with the biggest price increases include Disney+, Apple TV, Xbox Game Pass, the New York Times, and Hulu.
