This holiday season is going to mean big business for brands and retailers that offer gift subscriptions.
According to a new study conducted by subscription management and billing platform Recurly, 63% of consumers say they would consider giving subscriptions as a gift, while 70% expressed interest in receiving one. This momentum is largely being driven by Gen Z and millennials, nearly three-quarters of whom expressed interest in giving and receiving subscriptions as holiday gifts.
At the heart of consumers’ interest in gift subscriptions is their desire to experience something new, a sentiment that was cited by 60% of consumers.
“This holiday, consumers are looking for gifts of experience and utility, and that translates directly to a desire for subscriptions. As subscription brands begin holiday planning, optimizing their gifting experience is key,” said Theresa McEndree, chief marketing officer at Recurly.
“Subscriptions as a gift allows consumers to try something new or dig deeper into something they already love. And, with the wide range of consumer subscription types, there is something perfect for everyone on their list – from the pet-lover to the gamer to the fashionista.”
Brands and retailers looking to capitalize on the increased interest in gifting subscriptions would be wise to start offering discounts now, as 22% of consumers have already started their holiday shopping, and 40% plan to start their holiday shopping sometime in November. Overall, it is imperative to understand the customer psyche as the current economy will likely impact how they give gifts this year.
Another consideration to make is comparing the price and the length of the subscription offering and looking at subscriptions as an acquisition tool. The majority surveyed (72%) revealed that they would spend under $100 on a subscription service gift, and 34% of surveyed consumers said they would sign-up for a 6-month subscription for their gift recipient.
The good news for brands and retailers is that they stand a chance to turn these new subscribers into long-term customers. Fifty-two percent of the surveyed consumers plan to continue the subscription once the gift period expires if they find the subscription to be fun, useful, or helpful.
The new findings echo the key takeaways of another recent study conducted by Mastercard, which solidifies the notion that consumers are leaning toward experiences even as they face economic hardships.