A paid TV subscription used to buy you freedom from advertising. Now Disney wants me to upgrade to a more expensive tier to unlock the ad-free experience that was once standard.<\/p>\n
So, I\u2019m subscribed to something that is no longer premium, but I still pay a premium, and if I paid a higher premium, it would again be a premium experience.<\/a><\/p>\n Other television subscription companies have either done the same thing, or are planning to.<\/p>\n Let me give you another example. Recently I decided to do something that\u2019s a rare occurrence in our house \u2013 I ordered Uber Eats. (I\u2019m not sure why I feel the need to justify it \u2013 but it was Mother\u2019s Day and my husband was away!)<\/p>\n The restaurant was fast and the driver picked it up promptly, but then I watched the map as he drove our dinner around the surrounding suburbs for 61 minutes.<\/p>\n When he finally dropped it off, it was stone cold, and my kids had long been fed something else and put to bed. Happy Mother\u2019s Day to me.<\/p>\n The app had a solution, of course. Next time I could pay extra for \u201cpriority delivery\u201d.<\/p>\n I thought I was paying a delivery fee for the convenience of delivery \u2013 but instead, I must pay more to make that convenience less inconvenient.<\/a><\/p>\n (I can hear myself sounding very like my parents \u2013 \u201cback in my day it wasn\u2019t like this\u201d.)<\/p>\n But perhaps this was inevitable.<\/p>\n Many digital subscription companies have followed a similar arc. To begin with, the priority was growth \u2013 they wanted to capture as much of the market as possible, as quickly as possible.<\/p>\n Investors effectively subsidised cheap rides, endless content libraries, and extremely convenient services. That\u2019s what was required to get us hooked \u2013 and it worked.<\/p>\n Those investors now want a return on their investment, so those businesses need to actually make a profit. To achieve that, they\u2019re searching for the tipping point \u2013 what is the maximum monetisation consumers will tolerate before they cancel?<\/p>\n But I don\u2019t think this is confined to Silicon Valley subscription models \u2013 if you look carefully, you can see traces of it elsewhere too.<\/p>\n Did your grocery bill go down when you started scanning your own items? Are the reward points that convinced you to choose your credit card still as generous, or do you now need to spend more to get the same benefit? I don\u2019t remember flights getting cheaper when checked baggage became an optional extra.<\/p>\n To be fair, businesses are operating in the same economic environment that consumers are finding so tough. They\u2019re struggling with higher costs and customers who are sensitive to price hikes.<\/a><\/p>\n Consumer NZ\u2019s CEO Jon Duffy, says it\u2019s a \u201clower friction\u201d way of charging more. \u201cInstead of saying \u2018this now costs more\u2019, businesses strip back the standard service and make people pay to get back to what used to feel normal. That can make the increase feel optional, even when it really isn\u2019t.\u201d<\/p>\n The danger is that premium, convenient \u2013 or even useful \u2013 levels of service have become a constantly moving target and chasing them is increasingly expensive.<\/p>\n \u201cIt\u2019s less about offering more value and more about extracting more from customers who are already locked in by habit, convenience or hassle,\u201d Duffy says.<\/p>\n Everything is calibrated to extract just that little bit more, without us cancelling or \u2013 ideally \u2013 without us even noticing.<\/p>\n That\u2019s also where your power lies though \u2013 noticing. I\u2019m not going to suggest you cancel every subscription and make every meal from scratch, that\u2019s not realistic.<\/p>\n But we do need to go back to noticing \u2013 because inattention is expensive. Notice what actually provides value, notice what is actually worth paying for \u2013 and notice what\u2019s become so watered down that it\u2019s a waste of your time and money. Ask yourself, if this service launched today, in its current form and at its current price, would I still sign up for it?<\/p>\nConsumers now pay extra not for luxury, but simply to recover the level of service that used to come standard. Photo \/ Getty Images<\/p>\n
As customers quietly take on more of the work themselves, the savings rarely seem to flow back to them. Photo \/ Getty Images<\/p>\n
The subscription economy thrives not on satisfaction alone, but on consumers being too busy to reassess what still offers real value. Photo \/ Getty Images<\/p>\n