Press Releases

SAN FRANCISCO – March 5, 2024 – Recurly, a leading subscription management and billing platform, today announced the release of the latest subscription industry benchmarks for consumer and financial services subscriptions, painting an optimistic picture of growth. Collating data from millions of subscribers and billions of transactions, Recurly shares benchmarks and trends, augmented with expert best practices for subscription business growth.

As an established partner to market-leading brands, Recurly dedicates itself to sharing best practices and trends to increase subscriber lifetime value. The Recurly 2024 State of Subscriptions report epitomizes this partnership by helping its customers grow with insights from more than 2,200 Recurly customers and 58 million unique subscribers.

“Leading brands reference the Recurly State of Subscriptions report for meaningful insights and competitive analysis,” says Theresa McEndree, CMO of Recurly. “For consumer and financial services subscriptions—such as security, financial, consulting, technology, and legal services—the findings show that personalized offerings together with increased convenience and clarity in pricing continued to provide high subscriber value in 2023.” 

Benchmark Insights for Consumer and Financial Services Subscriptions

Overall, subscriptions in the consumer and financial services industry are witnessing significant growth while appealing to consumers' needs for convenience, especially millennial consumers. From Recurly customer data, consumer and financial services subscriptions are marked by a 73% surge in active subscribers since 2020—a testament to the growing demand. In fact, consumer service subscriptions continue to create more robust recurring revenue streams and engagement models through digital marketing and flexible pricing and promotional strategies.

Notable findings and insights of 2023 include:

• The acquisition rate, defined as the percentage of customers acquired each month, stands at a median of 4% and pales against the overall subscription industry median of 5%. A targeted strategy to attract high-value, commitment-ready consumers to the subscription service is key.

• Trial-to-paid conversion rates are at a compelling 56%, higher than the industry average of 50%, showing that trial offers are an attractive option for consumers. Nonetheless, an 11% sign-up decline rate signals the need for more streamlined sign-up experiences and transparent pricing strategies from day one.

• Plan customization has resulted in a profit uptick, with a 26% adoption rate yielding $39.7M in additional revenue—a nod to the allure of personalized offerings on consumer services.

• An overall churn rate of 4% suggests the potential for improvement, and a 1% involuntary churn rate underscores the effectiveness of Recurly's churn management technology—minimizing failed payments to provide subscribers with uninterrupted service and maintain the business’s recurring revenue.

• As acquisition industry-wide slows, the importance of recovery strategies is high. The recovery rate for at-risk consumer and financial service subscribers stands at 75% and added 181 days to the subscription post-recovery. The $8 million accrual from dunning initiatives continued to show the efficacy of recovery strategies for these businesses.

• Interestingly, alternative payment methods (APMs) exceed the industry norm at 15%.

As consumer and financial services subscriptions continue to evolve, the following strategies are projected to drive future success:

• Free trials with a potent hook—limited access to a premium feature, discounts for early adopters, incentives for social sharing, and the like—can transform a staggering 79% of trial subscriptions into continued subscribers within a week or less.

• The rise in alternative payment methods (APMs) demand is a beacon for proactive adaptation, promising enhanced renewal processes and streamlined subscriber experiences, while potentially reducing payment-induced churn.

• Data analytics and predictive modeling stand out as indispensable, showing customer churn trends that enable personalized offers tailored for at-risk subscribers.

The full 2024 State of Subscriptions report provides comprehensive insights and actionable intelligence for companies eager to lead. To learn more, please visit recurly.com.

About Recurly

Thousands of innovative companies across digital media, streaming, publishing, SaaS, education, consumer goods, and professional services industries rely on Recurly to unlock transformational growth using subscriptions. Recurly’s all-in-one, integrated platform removes the complexities of automating subscription billing at scale by enabling teams to manage and optimize their subscriber lifecycles with ease. Category-defining companies including Sling, Twitch, Bark, FabFitFun, Paramount, Lucid, and Sprout Social have chosen Recurly to manage billions of dollars in recurring revenues, future-proof their recurring billing and revenue management, and recover billions of dollars in lost revenue due to churn. Founded in 2009, Recurly is based in San Francisco, with offices in Boulder and London. For more information, visit https://recurly.com.