Things you need to know about online subscription services
Online subscription services are only becoming more popular. For clarity, subscription commerce is like a magazine subscription but for just about anything – whether it be physical or digital. Subscription commerce can essentially be categorised in two ways:
- Convenience Commerce – this is where you receive the same products automatically on a repeat purchase basis, physically or digitally.
- Discovery Commerce – this helps the customers sample new products on the market which they may not have otherwise discovered or come across.
The most popular model of subscription commerce is currently the ‘subscription box’. This refers to customers paying a weekly, monthly or yearly subscription fee to receive products which will be personally delivered to them at their homes in a box. Common subscription boxes contain cosmetics, male grooming products, films, pet food and toys. More recently, you can receive a monthly subscription box filled with feminine hygiene products. Pink Parcel subscriptions boxes usually contain things like; enough sanitary products for one cycle; chocolate, herbal tea, beauty products and seasonal surprises. In whatever type of subscription box you receive, an element of mystery plays a part as you do not know what you are getting the month to month.
Subscriptions made online can also be for digital products such as streaming websites like Netflix, Hulu or Amazon Prime Video. You will be invited to sign up for a plan where you can choose your benefits and according to these, how much you will pay month to month.
Signing up for a free trial
If you are new to a website, you will usually be offered a free trial to the subscription or a promotion of some kind. By all means, take full advantage of this. However, once the agreed period is up – the company will start taking your money as it is assumed a plan has started. If you do not wish to continue for the service, make sure you set a reminder to cancel your account before the date of billing will begin. Many people forget about setting up a free trial or lose track of time and are then faced with an unwanted payment deducted from their bank account.
Difficult to Cancel Subscriptions
Watch out for subscriptions which are designed so that they are hard to cancel. These are said to be costing people an average of £50 a month! Citizens Advice claims that many companies are intentionally making it harder for people to cancel the services they pay for.
Be aware of what you are paying for
A report that was done by Citizens Advice also found that people were paying through the nose for online subscriptions over long periods of time that they did not even know they were signed up to. This has been able to happen because of a “continuous payment authority”, which is otherwise referred to as a recurring payment. This essentially gives companies offering online subscriptions permission to regularly extract payment via debit or credit card whenever they deem is appropriate that money is owed.
How to cancel an online subscription
Your first port of call will be to try and cancel through the retailer or service provider itself, either online, on the phone or in writing. The majority of companies will be obliged to cooperate and that will be the end of it.
However, if it is the case that the company refuses, the next step is to ask your bank or credit card provider directly to cancel the payment which has been set up. In 2013, the Financial Conduct Authority ruled that banks have to cancel a recurring payment when asked. If they fail to comply, you are within your rights to complain and receive a refund. If your complaint is rejected, then you must complain to the Financial Ombudsman.
How to spot an unwanted payment
Sift through your bank statements for anything unusual or log on to your online banking and look at any regular payments. Any which are not specifically listed as standing orders or direct debits will be based on a CPA.
If you use a mobile payment service to pay for smartphone-based subscriptions, bear in mind that the payment will appear as “Apple Pay”, “Android Pay” or “PayPal” and so on in your bank statement.
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