CHARLOTTE, N.C., May 13, 2020 /PRNewswire/ -- The coronavirus pandemic has drastically altered the way Americans spend money. In many cases, that has meant cutting back — but one area where many consumers are spending more is on subscription services.
A recent CompareCards survey found that 1 in 3 respondents had purchased a new online subscription as they sheltered at home to reduce the spread of the virus as well as to entertain children after schools have closed.
- 1 in 3 consumers have purchased a new online subscription as a direct result of coronavirus-related circumstances, such as being stuck at home or for child-friendly entertainment.
- The top five most popular new subscriptions include streaming services like Netflix or Hulu (17%), Amazon Prime (15%), food/delivery services, such as Instacart (12%), magazines and newspapers (8%) and virtual exercise programs (8%).
- On average, consumers spent $192.30 on these new subscription services, and while some may be a one-time or annual fee (like Amazon Prime), many of the costs will recur monthly.
- The two biggest reasons Americans subscribed to new products or services are to entertain themselves (67%) and to entertain their children (41%) while stuck at home.
- Nearly 60% of parents of children under 18 purchased a new subscription.
Streaming subscriptions booming as people stay at home
Of those who purchased a new subscription, 67% said the main reason they did so was for entertainment, and 41% said the main reason was to entertain their children.
- Amazon Prime was most popular among Gen Xers (27% recently signed up).
- A quarter of parents with young children at home signed up for a food delivery service.
- 35% of parents with young kids and 31% of Gen Xers signed up for a new streaming service.
Consumers' subscriptions helped reduce trips outside
When asked to select why they signed up for a new subscription, 39% of respondents said that they did so to reduce having to leave the house to purchase necessities. Millennials led the pack with 43% saying so.
This seems to correlate with why Amazon Prime and food/delivery services were among the most popular new subscriptions. And of all age groups, members of Gen X were most likely to subscribe to these services (27% for Amazon Prime and 20% for food/delivery), followed by millennials (19% for Amazon Prime and 16% for food/delivery).
Parents most likely to sign up for streaming, food delivery services
With rampant school and day care closures, it's no surprise that 41% of survey respondents who got a new subscription said the main reason they signed up was to entertain their children. Nearly 60% of those who are parents of children under 18 years old purchased a new subscription of some kind.
The three most popular new subscriptions reported for parents were as follows:
- A streaming service (35%)
- Amazon Prime (33%)
- A food/delivery service (25%)
For all of these services, parents were more likely than the average respondent to sign up. Here's what the overall numbers looked like:
- A streaming service (17%)
- Amazon Prime (15%)
- A food/delivery service (12%)
Matt Schulz, Chief Credit Analyst at CompareCards by LendingTree said, "Cardholders who are thinking about adding a subscription should evaluate what their spending patterns look like right now. For example, staying at home more might mean you're saving on gas, but spending more on utilities. And if you are cooking more at home rather than dining out at restaurants, that could mean savings on dining but more dollars spent on buying groceries."
To view the full report and for more information, visit https://www.comparecards.com/blog/subscription-service-spending-triples-amid-social-distancing/.
LendingTree (NASDAQ: TREE) is the nation's leading online marketplace that connects consumers with the choices they need to be confident in their financial decisions. LendingTree empowers consumers to shop for financial services the same way they would shop for airline tickets or hotel stays, comparing multiple offers from a nationwide network of over 500 partners in one simple search, and can choose the option that best fits their financial needs. Services include mortgage loans, mortgage refinances, auto loans, personal loans, business loans, student refinances, credit cards and more. Through the My LendingTree platform, consumers receive free credit scores, credit monitoring and recommendations to improve credit health. My LendingTree proactively compares consumers' credit accounts against offers on our network, and notifies consumers when there is an opportunity to save money. In short, LendingTree's purpose is to help simplify financial decisions for life's meaningful moments through choice, education and support. LendingTree, LLC is a subsidiary of LendingTree, Inc. For more information, go to www.lendingtree.com, dial 800-555-TREE, like our Facebook page and/or follow us on Twitter @LendingTree.
CompareCards' mission is to help people make smarter, more informed, healthier financial decisions based on deeper knowledge of financial offers. Each month, over 2.9 million visitors come to CompareCards' website to independently compare credit cards side-by-side and choose a credit card based on interest rate, reward benefit, cost savings, and other factors that are important to each person. CompareCards provides easy-to-use, objective tools and educational resources that help people do everything from making credit card comparisons to managing their credit health. For more information, please visit http://www.comparecards.com.