By this point in January, you are probably analyzing which of your business and personal New Year Resolutions will stick. Some resolutions will become a habit, while others will drop off everyone’s radar. If one of your resolutions is to maintain a tight focus on your business budget, this blog is for you.
At MainSpring, we often review client technology plans and budgets. Reviewing, managing, and regularly updating IT budgets is just one of the many tasks we take care of in our ProSuite IT managed services. During a review, a budget-buster that we often find is an overpayment for subscription services.
The subscription culprit
I will start with an example to which we can all relate. During the past year and the COVID pandemic, we have all personally subscribed to multiple entertainment streaming services, virtual gym classes, multiple chef-inspired meal boxes, virtual trivia nights…it’s a long list. How many of those services are you still using ten months later? Are those subscriptions still hitting one of your credit cards?
If you feel as if you are bleeding money, subscription services may be a culprit. Subscription services impact both your personal and your business budget. Now is the time to review and understand the real impact of unused subscription services.
Subscriptions creep into your wallet.
We all know how subscription services creep into our personal budgets. It may start with a 14- day trial that you forget to discontinue. Or you may want to watch a popular movie or series, and it is only available on one streaming service, so you join. It starts slow and turns into an ever-growing snowball. Here are just a few stats to open your eyes.
- 84% of Americans underestimate how much they spend every month on subscriptions—Wall Street Journal
- Americans waste $348 a year on subscriptions that they do not use—Yahoo
- One family used TrueBill to save $3600 a year as they canceled unused subscription services. Watch the NBC news story here.
If you are a business owner or leader, you may be thinking that the subscription snowball only happens on a personal level. “We watch our budget, and it is not happening in our organization.” You may be right, but it is worth a careful review to find hidden costs. I will list the top ways that a subscription snowball grows in a business environment.
Subscription services impact your business.
As the MainSpring team evaluates your technology budget, they may find that you are paying for subscriptions that are not in use or overpaying for a graduated usage fee. Here are three budget culprits often found.
- A team is preparing for an important presentation and includes stock photos, graphics, and templates. A team member signs up for a subscription service on their corporate credit card. The subscription carries a monthly or annual auto-renewal and is not canceled. The same scenario plays for software and smartphone applications. Often, software subscriptions that are purchased for a unique team project fly under the radar.
- A subscription billed by total time and usage blocks may not be used to capacity. As an example, you may have subscribed to software usage, by blocks of hours, through a cloud platform. When was the last time that you audited use and compared it to your contract? You may be overpaying.
- You already know that it is essential to let your IT team know when you off-board an employee. Passcodes and privileges need to be changed. But, does your off-boarding process include a subscription review? (I am currently writing a future blog that will consist of an off-boarding checklist) Often, unused subscriptions go unnoticed for months and are impacting your budget.
Those are just three ways that subscriptions may be negatively impacting your budget. The only way to know the real impact of subscription services on your business is to “audit and survey.”
Audit and survey tips
2020 was a year of rapid change. To many, it felt as if 20 years of evolution compressed into 10 months. The trend includes the way we work. Work from home (WFH) and customer interaction are forever changed. This rapid change also led to a surge in the use of subscription services.
If you did not audit the use of subscriptions and survey your employees and customers in 2020, it is not too late. MainSpring provides the below tips to implement an audit and survey of subscription services.
- In a recent blog, I wrote about establishing a Business Task Force. An audit and survey is a project for your Business Task Force. When evaluating subscription services, it is vital to consider opinions from all business divisions and team leaders.
- Start with the audit. To fully understand how subscription services impact your budget, you have to know your current commitments’ real impact. You have to see this month’s commitment and see the duration of the subscription commitment.
- During the audit, ensure that you understand which subscriptions are monthly payments, quarterly, and annual renewals/payments. Services that are annual renewals and costs often go unnoticed and include an auto-renewal.
- Know and understand your subscription contracts. Do you have to give a 90-day notice to non-renew?
- Once you have a list of current subscription services, survey your employees. Are they still using the stock photo subscription, or is it time to non-renew? Keep in mind that a business team may need a subscription service that appears non-essential to management.
- Lastly, it is crucial to know the impact of a subscription service on the customer experience. Is your brand’s positive customer experience tied to a subscription service (or is a subscription the culprit to a negative experience trend)? To understand the impact, consider surveying your customers about their experience.
Our top tip is that you should plan an annual review of all subscription services. The business environment is similar to your household subscription usage. You may have scrubbed your personal use of subscriptions months ago, but how many new subscriptions have crept into your household budget? Multiply that answer by the size of your company…
MainSpring is an IT services provider in the DC, Maryland, and Virginia (DMV) region. Our ProSuite Plan suite of services includes subscription services management. How can we help you?