Traditionally we have been conditioned to believe the fourth quarter is by far and away the most important time of the year for retailers. Some insightful analyses by the Business Insider team indicate that is a myth with the Q4 number not eclipsing 27.88% since 1992.
However, perception is often reality, and we know and very much feel the frenzy of gift giving at year end. It is, after all, the time of year when gift-giving schedules align, and we are inundated with aggressive offers of buy this or that – and buy it now, or you will miss the deal of a lifetime and the love and adoration of family and friends.
This got the Magid team thinking, “What about gifts that give all year long?” We conducted a comprehensive, nationally representative study of 2,500 US consumers about their attitudes and behaviors specific to subscriptions. It’s one of the country’s most in-depth consumer surveys on subscriptions covering 14 categories and is full of amazing insights including the intersection of gifting and subscriptions.
US consumers can pretty much subscribe to anything nowadays – and we’re not talking about the TV Guide many of us remember as youngsters. Sure, you can get meal box replacements, streaming entertainment content, fitness-related offerings, and many other things covered in the Magid survey. There are also emerging subscription options for things like cars, travel, restaurants, entertainment and curated clothing options you can buy or rent. Many of these categories make for unique and compelling gifts – especially during the holiday season.
Before we dig into subscriptions and gifts, let’s first get grounded in some basic facts coming from the Magid deep-dive into subscriptions. In our study we omitted magazine subscriptions, not because we don’t love magazines, but because we wanted to intentionally focus on more of the contemporary offerings that have emerged as newer entrants over the last few years.
There is an average of 3.7 subscriptions per household and the intent to renew is high with 85% indicating plans to do so.
Subscriptions have double-digit representation in each of the household income breaks we reviewed and skew toward higher income households with 42% accounting for annual incomes greater than $100,000.
Overall, 25% of households have more subscriptions than they did six months ago. The momentum associated with subscriptions is strong with many categories showing higher intent to purchase in the next six months than are currently subscribing. Some categories with particularly bright growth prospects have a purchase intent rates of at least two times their current subscription rate. These categories include: clothing/fashion, meal kits, home and kids/baby – all of which make great gifts, by the way.
So, what about gifts? Attitudinally, consumers are quite favorable as “subscriptions make a great gift” indexed comparatively high. Nearly one-third of consumers indicated receiving a subscription as a gift while 44% are at least somewhat likely to give a subscription as gift. Mom was right; giving a gift is better than receiving a gift!
Magid’s subscription study uncovered several other insightful themes regarding subscriptions and the gifting of subscriptions. A couple of note-worthy examples: members of travel-related loyalty programs are more likely to have been gifted subscriptions across any category and are also more likely to gift them in the next 12 months. And in the beauty/grooming category, surprisingly, men were more likely than women to have received a subscription as a gift.
Interested in more insights from the subscription study? Let’s talk.