Music, series, magazines – but also diapers, sweets and even heated car seats: Monthly payments are all the rage. This can quickly become a problem for customers, as the star learned in discussions with experts.
Recurring Revenue. What is the concept of the hour for corporations and shareholders is increasingly taking on a growing role in budget planning in the lives of consumers. Because it’s no longer just a streaming provider, maybe a magazine or the gym that appears on the monthly credit card statement. In the meantime, you can pay significantly more in small portions.
While payments for Netflix and Co., mobile phone contracts and memberships can still be explained relatively easily, it is primarily supposedly innovative products whose subscription offer appears at least questionable. The car manufacturers are probably receiving the most attention at the moment. Gone are the days of fully financed vehicles – the age of leasing and sharing has long since begun. But that’s not all.
Everything in the subscription – whether seat heating or noise canceling
Even if you buy a vehicle in the classic way, certain functions may only be available after a monthly subscription. BMW kicked things off this year with rented seat and steering wheel heaters (find out more here), Mercedes recently joined the ranks and offers the release of the highest power level of the engines for certain electric cars for a regular fee.
And although both manufacturers also offer permanent activation of the additional functions, the outcry is great. Because what is emerging here is a worrying trend for many, which is now also continuing in completely absurd sectors.
Recently, audio expert Bose made the headlines in this regard, whose CEO Lila Snyder thought aloud about whether individual functions of popular headphones, such as active noise cancellation, should not be put behind a payment barrier.
If you lose track, you pay the bill
The problem for customers is not the one-time purchase or hesitant trying out, but the gradual capitulation to more and more monthly burdens.
stern spoke to Felix Riesenberg from Aboalarm, one of the leading providers for monitoring and terminating contracts and subscriptions. In a survey of around 1000 people, the company found that three out of four Germans have difficulties terminating subscriptions and contracts. It often fails due to missed deadlines or complicated termination processes.
“You should be careful, because the subscription jungle is becoming more and more confusing. There are now paid subscriptions not only for music and series, but also for sweets, diapers and even heated seats in the car. This is convenient, but also costs money. In addition, there are classic contracts for mobile communications, Internet, insurance, electricity or fitness studios. The biggest problem with contracts and subscriptions is that they renew automatically and we often forget to cancel them. Then the free trial month suddenly becomes a paid annual subscription. Many are stuck in the contract loop,” explains Riesenberg.
However, it is precisely this loop that is so attractive to companies. Because if one falls into oblivion, the ruble rolls without further action. Riesenberg warns: “On average, each of us has thirteen contracts and many are surprised when they list what they pay for. Depending on how the costs due are debited – quarterly, semi-annually or annually – the completed subscriptions quickly disappear from the account. Curious example: Some people still have old Jamba savings subscriptions that were advertised with the Crazy Frog on Viva and Mtv in the 2000s.”
In addition to the subscriptions and contracts that cannot be avoided and those that secure access to a specific service, there are also more and more subscription traps that can be triggered by simply clicking on the wrong advertising banner, the consumer advice center warns. If you have lost the overview anyway, these often small amounts are no longer noticeable.
Too many subscriptions? You can!
Luckily, there is a lot that can be done to counteract the flood of costs – both preventively and retrospectively. The consumer advice center recommends so-called third-party blocks in order to avoid unwanted subscriptions via the mobile phone provider. If you come across a dubious offer with such a block, the provider blocks the payment and does not allow the contract to come about.
As far as desired contracts are concerned, a regular look at payments via credit card, Paypal and services such as Apple Pay helps. “There are many ways to keep an eye on costs, from the classic household book to new apps. Functions such as the automatic recording of all current contracts from account transactions are particularly practical. For example, we offer a free contract manager with a recognition and reminder function. This allows you to find your contracts quickly and have them remind you of the notice period by e-mail,” advises Riesenberg.
Monthly payments are also a popular way to generate sales for apps. So that recurring payments for games or utilities don’t get out of hand, both Google and Apple offer a handy overview of which subscriptions you have taken out and when they start collecting money again. Instructions on how best to do this can be found directly from the operators of the app stores – here for Apple and here for Google.