Subscription-based payments are becoming one of the most preferable consumer methods of paying for goods and services, but has the growth of this market also breed fatigue amongst consumers?
Speaking to Payment Expert, Joe Rohrlich, CEO of Recurly, he explains why subscription-based models are placing more emphasis on personalisation tools – like offering alternative payment methods – can not only help retain customers, but also make their experience more enjoyable.
Rohrlich also discussed the impact AI is having on the subscription payment sector, why consumers are more mindful of choosing which subscription plan to select, and the impact bundling is having on driving efficiency.
Payment Expert: Firstly Joe, what were some key takeaways from the 2025 State of Subscriptions report that have affected the market over the last few years?
Joe Rohrlich: Retention emerged as a major focus for subscription businesses in this year’s State of Subscriptions Report. Consumers have faced a combination of economic factors that have made them more aware of how they spend their money, and businesses have responded by focusing on keeping existing customers and giving them a great experience.
For subscribers, flexibility has been a top priority – whether it’s the ability to pause instead of cancel, explore different payment methods, or receive personalised services. With the increasing amount of subscription services on the market, consumers are more selective about where they spend their money. They’re looking for platforms that truly understand their needs, whether that’s offering bundling services or rewarding their loyalty.
PE: Was there an overall feeling from the report that consumers are becoming more mindful of what subscriptions they are paying for, with subscription pauses rising by 68% over the last year?
JR: Absolutely – mindful is a good description. That 68% jump in pauses is a clear sign that consumers are taking a more active role in managing their subscriptions.
It’s not necessarily that they want to cut back on subscriptions forever; it’s about them having more control over their subscriptions. Rather than canceling all together, people want the ability to step away temporarily without losing their preferences, loyalty perks, or history with brands they like the most.
PE: With free trial conversion rates decreasing, what should companies do to diversify their trial offerings? Do consumers get put off by entering card details?
JR: I think historically, it being difficult to cancel a subscription has been a detractor for would-be subscribers who might be concerned about being trapped into a payment plan they aren’t ready to commit to.
There’s been some movement in the US on this front with the FTC implementing new regulations meant to make it easier for consumers to unsubscribe, which is a good step for building more trust between consumers and subscription companies.
Consumers are wary of free trials that might result in unexpected charges, making them hesitant to provide their card details upfront. To build that trust, businesses must be fully transparent about trial terms so would-be subscribers know exactly what to expect.
Diversifying trial offerings can also make a difference when companies use AI to personalise their customers’ experiences, which allows them to tailor offerings based on individual consumer preferences.
PE: The report found a 19% increase in alternative payment method adoption. How critical is payment flexibility in 2025 when it comes to how customers want to pay for their subscriptions?
JR: Payment flexibility is no longer a nice-to-have; it’s an expectation. Consumers want to pay in ways that are most convenient for them, whether that’s an old-school credit card or digital wallets like Apple Pay, PayPal or Buy Now, Pay Later.
Offering multiple payment choices improves the user experience and helps make it easier for subscribers to find a payment method that works for their needs while also reducing churn.
For example, if a subscriber’s primary payment method fails or expires, having an alternative option to quickly fix a payment issue can minimise the risk of losing them over a simple problem with an easy solution.
PE: What role will AI play in automating the user experience for subscription payments and potentially other benefits not realised yet?
JR: AI is already making a huge impact on subscription payments. A major benefit of AI is its ability to reduce churn. It can predict when a subscriber might cancel and trigger personalised retention offers to keep them engaged.
AI is also improving payment success rates by managing failed transactions and proactively helping businesses collect updated payment information. This means fewer disruptions for subscribers and more reliable revenue for businesses.
As AI evolves, I think we’ll see even more innovations like hyper-personalised experiences and smarter fraud detection emerging to create an even better payment experience.
PE: Is there a danger of market saturation when it comes to subscription-based models?
JR: There are certainly more subscription services coming online now than even just a few years ago. With so many options, it’s inevitable that consumers in more saturated markets will show some signs of subscription fatigue, where they feel overwhelmed by the number of services competing for their attention. But that doesn’t mean subscriptions are losing their appeal; I think it actually creates more incentive for brands to offer more value to their customers.
In the long term, I think the brands that thrive will be the ones that focus the most on creating that value and making personalization and flexibility a priority.
PE: Are customers demanding more access on singular platforms to avoid paying for another subscription?
JR: Bundling is definitely something more consumers are asking for. They want to be efficient in how they spend their money and time; nobody wants to have to manage many different sets of login credentials or subscriptions when there’s the option to have everything in one place.
We’ve seen this trend emerge, for example, with streaming services bundling their offerings to give subscribers access to more content at a better price. They’re even partnering with businesses like grocery stores to offer even more comprehensive bundled services. Those that can expand their offerings in the right way and form strategic partnerships have a stronger chance of keeping subscribers engaged long-term.
PE: Lastly Joe, and thank you for your time, are there any other personalisation efforts companies should consider to tailor to their preferences?
JR: Personalisation is about making customers feel like the subscription is designed just for them. An approach that has been working well is dynamic pricing, which offers different plans based on usage. If someone needs to use a service less this month, they pay less; that creates incredible value for consumers who use that feature.
Knowing people have busy schedules, the ability to plan out delivery dates for, say, a fashion subscription, is a very useful tool for consumers who plan their lives around their subscriptions and want to personalise them to their own lifestyle.
One more I’ll leave you with is predictive engagement, where AI suggests content, products, and services based on past user behavior. The goal of all of this is to shift from a one-size-fits-all approach to a highly personalised one that adapts and evolves with the customer’s individual needs.
