By Keith C. Milne
Like many people, I have a few subscriptions. These days, it isn’t hard at all to begin a subscription to a music service like LiveXLive, Pandora, or Spotify. The same ease of subscribing can be said for Netflix, Amazon Prime, Doubleday Book Club, Sam’s Club, Costco, or YouTubeTV but these are only a tiny fraction of all the business entities that currently offer or require a subscription in order to receive their goods and services, and we all seem to be awash in the nearly constant bombardment of subscriptions for content, or products, or special deals that can only be had by becoming a member.
Indeed, little-by-little, the number of businesses that offer or require a subscription or membership in order to access what they are selling have grown exponentially in the last 30 years. However, the COVID-19 pandemic really helped this phenomenon because so many people were stuck at home for long periods of time and needed to find ways to procure their supplies safely by ordering almost everything online.
When the supply chain became spotty during COVID, many items could not be found or purchased anywhere for periods of time as well, but companies with limited supplies were prioritizing what they did have by sending the few supplies in their inventory out to their subscribers first, followed by everyone else on a first come-first served basis. The whole phenomenon isn’t new at all, but the amount of goods and services being offered this way is now at a historical high and shows no sign of slowing down anytime soon.
I remember way back when I was a kid growing up in California (expensive place to live) my mother and many others just like her would do what they could to save money. One of the first “gimmicks” to get a consumer to buy more by several grocery chains back then was the S&H Green Stamps program. Based on the total of your grocery purchase, a consumer, like my mother, would get handed a (sometimes) long ribbon of “green stamps” that had S&H printed on them. My mother pasted hers into books filling the pages with these green stamps. She had a catalog of items that could be purchased either at a reduced price along with a certain number of green stamps, or entirely free for a much larger amount of green stamps redeemed. The catalog would tell my mother how many books of stamps would be needed for the different items. The more someone spent, the more stamps they would get and the sooner they would be able to trade stamps for merchandise.
Back then, memberships and subscriptions were largely memberships at the golf course, men’s club, women’s club, or perhaps the YMCA or private gym. Subscriptions were limited to magazines, then record clubs, then book clubs. Encyclopedias such as Encyclopedia Britannica could be a subscription until all the volumes were owned. $5000 minimums were required to open a brokerage account and become part of the investment club.
The old S&H Green Stamp for merchandise program slowly faded into the woodwork in the 1970’s but along came similar points programs by grocery chains, minus the stamps. My wife and I have used our grocery purchase points to “buy” a really nice set of wine glasses, and other dishware items in the past. I thought it was great because it was like saving up for something you wanted, without having to save actual money to spend on it. Simply by buying what you would have anyway while grocery shopping, you would build up enough points to own something nice. I don’t believe it ever truly influenced our purchasing in as far as increasing the total we spent in order to get what we were saving for faster, but it did do a great job of getting us shopping almost exclusively at that particular store.
Eventually, getting points based on purchase amounts has slowly morphed into the retail merchant customer loyalty rewards program or similar. The gist of this type of program is that the retailer gets as much information as they can about your shopping behavior by having customers sign up for their program, then give the customer a card or keychain tag with a bar code on it. When the customer checks out, their card or tag is scanned and the customer gets a discount off of much of their merchandise, and the store gets your shopping history. That helps the store tailor its inventory more to what the customers are buying or would likely buy based on their shopping histories.
It’s a form of quiet blackmail: first to become a member, you have to give up your name, address, phone number, and other data, and your spouses data for them to have a card, and then the store gets to know what you buy, how much, how often, and what you’re willing to pay for the goods as they raise prices over time! The really hefty profit kicks in from those who decline getting one. These folks pay the full, inflated price reserved for them and them only ALL THE TIME (talk about inflation!).
I clearly remember being one of the hold-outs, not because I didn’t want the discount, but I saw through their little gimmicky retail trickery right off the bat, and don’t like people attempting to manipulate me and treating me like I’m some kind of an idiot. I also didn’t want to add yet another tag on my keychain! A man who doesn’t carry a bag or purse, puts their keys in their pocket. Having a bunch of plastic tags poking my leg all the time wasn’t something I wanted any part of.
One by one, the retail merchants of America all fell into line adding this type of program to their business model and we consumers were having to use plastic tags and cards everywhere, and we still are to this day. Virtually all grocery stores, Dick’s Sporting Goods, Big Lot’s, and Best Buy go this route, and even stores that didn’t go with tags and cards, have gone with “Apps” for your “Smartphone” (hmmm . . . smart for whom?) that let you manage your points and discount activities. Starbucks and Dunkin Donuts have apps that let you add gift cards into them, and keep track of all your discounts and purchases.
And on it goes, AAA, AARP, both have “programs” that supposedly save you money, and all the airlines, most credit card companies have perks programs, travel miles to trade for airline tickets, hotel stays, and even rental cars.
With fast internet becoming more the norm than the exception for most of us now, streaming services have popped up like mushrooms over the last two decades. They don’t offer points and rewards, per se, but the premium streaming services will require the customer to PAY TO BE A MEMBER, and being a member is a requirement in order to view the content they offer. Some go even farther, I guess because it works, they have different payment tiers within their subscription model, like Paramount Plus. Their basic paid membership doesn’t entitle the member to zero ads, only “limited ads.” The customer has to pay almost double the basic fee to get no ads, and even then they will get ads during live premium content, such as the Super Bowl! The network is getting paid from everyone: the subscribers, the advertisers, and the content providers.
It’s so interesting how even writing about this new retail phenomenon makes it all seem to innocent and happy and a scenario where everyone wins! The retailer cuts costs, and streamlines their inventory, while gaining customer data to support future decision making. The customer wins by getting extra merchandise, discounts, free stuff, or premium, paid only content or no ads.
Well, it isn’t so happy at the consumer end. What has been created supposedly to save us money, is just another big huge mess for consumers to plow through and manage. It wouldn’t be so bad if perhaps one universal system was adopted by all if there is going to be one at all. Instead, we get a thousand different companies all doing different ways of programs like previously described, each with their own set of rules, exceptions, and limits. It’s ridiculous! Half of us are using only certain services now, even knowing that we could save money with another company at times for one thing or another, but afraid to jump ship because we might lose all our points.
You go to book a vacation trip for yourself or your family. You go online and let’s say you go to a travel platform like Expedia.com or similar in order to get “package savings.” Because you did the plane, the rental car, and the hotel all at one site, they are now going to give you a discount for packaging the whole trip together at their site.
But do you really get serious savings? Hardly! First, they inflate the prices shown, then tell you that they’re running a sale and today the price is much less. You get excited and book the whole trip through them. They get full fare including their huge profit margin, while they are trying to convince you that you got a real bargain. Not only did you get everything on sale (from an overpriced starting point) but then got additional package savings, AND more travel points to use for your next trip. You believing this has you smiling looking forward to the trip, with the added pleasure of your perceived savings becoming the cherry on top of the deal.
When you go to pay for the aforementioned trip, you get asked if you have any coupons, gift cards, or would like to use any travel points you have. They ask if you have a car rental membership card, AARP discount, hotel club card, travel club discount, etc. The prices at times can be fairly discounted, but only over and above what others have paid, and they have paid enough to more than cover your discount. This is similar to the folks without customer loyalty cards paying full fare all the time for at the stuff they buy. They are subsidizing the discount for those that do.
Most people don’t realize that in retail world, there is an automatic 400% markup on everything sold. That way, any “sale” offered still allows for plenty of elbow room to reduce the starting price and convincing quite a few people that they are getting a better deal than they would on a non-sale day. That may be true, but what they purchased is still at 200% markup even on a 50% off sale!
All of these perks, rewards, tags, cards, programs, loyalty points, bonus points, travel points, and special treatment and savings and added perks that these special people get are all gimmicks and are all designed to get you to buy more and consume more, travel more, and watch more of what they are selling. Overtime, the prices have all climbed and now, even with these so-called perks, everyone is paying more now than ever before for everything.
Capitalism is one system of economic and monetary checks, balances, and consumer activity and it needs new markets and more buying and selling commerce over time in order to succeed. Without new markets, capitalism will slowly but surely perish, unless it can ceaselessly expand. In that regard capitalism is a ruthless monster living by a Darwinian model of “survival of the fittest.”
Sure, you may get a better deal today than the guy sitting next to you because you had the right perks rewards program in play and he didn’t, but tomorrow you’ll be the one who paid more than someone else in a different place and under different circumstances. Just know that the 30 cents per gallon price reduction for using your grocery store points are subsidized by everyone, including you at different times, and that by using them at the grocery store chain gas station, which by design is the only place you can use them now, is just giving those “perks” right back to the entity that gave them to you in the first place.
Most folks do feel that these days in order to save a little from day to day, you do have to play a lot of gimmicky consumer games with coupons, rewards points for purchases, memberships, and online retail savings programs, tags, cards, and apps. All of this is costly, and that cost is paid for by everyone having to pay more across the board for everything, while we are being convinced that all we need is another tag or card or subscription to benefit from lower costs or immediate savings.
You are not saving anything at all by doing any of this. In fact, most savings are spent in the form of buying things you otherwise wouldn’t, or buying more of what’s on sale justifying the extra expense of the additional purchase by the temporary lower price, or the “but I’m getting it now while it’s on sale” line of reasoning. Yes, you paid less per unit, but purchased more. Yes, you would have bought it anyway if it’s toilet paper we’re talking about, but a lot more if it’s a new watch or jewelry item.
I also have to take big issue with the insatiable appetite born out of these relatively new and evolving methods to get us to part with our hard earned money. It drives predatory behavior. For example, I recently received an email from Shutterfly.com, the online venue for uploading digital pictures and getting actual photo prints, mugs, place mats, mouse pads and other gifts with the photos on them back. They thanked me for my patronage over all the years, but felt compelled to inform me that, unless I made a small purchase by March 29, 2023, that they would delete all of the pictures and former projects that I had created over the last couple of decades!
Two days later, another email from an online plant seed retailer landed in my in-box informing me that if I didn’t use my 1100 points by the end of the month that I would lose all of them! I went to the site, logged in and looked around. I found a few things I’d like or would have bought in another month anyway, and then went to check out only to learn that in order to use these points AT ALL, I had to buy $180 in merchandise, and would then get a $60 credit from redeeming my 1100 points! This is the type of behavior that is becoming more common all the time. It’s kind of surprising in light of the level of competition for peoples shopping dollars that anyone would behave with such strong-arm tactics. No, I did not take the bait, and I still have plenty of seeds. How about leaving them for me as an enticement to come back when I’m ready for more, or at least raising the limit on the amount of time that someone has to use them. ??
I have also learned that my basic subscription to Paramount+ doesn’t reduce my level of exposure to advertising nearly enough to satisfy me and that what it really buys is the ability to see all of the shows on CBS anytime I wish, and stream the whole season of a show, watching them all back to back if I want to. It’s double the basic price to get rid of the ads. I never imagined that I would someday be able to stream content effortlessly like I can now, but I cannot get used to the idea that I have to pay extra to get ads out of my life! They also claim to reduce the amount of ads a viewer is exposed to even on the plans that include ads, but it doesn’t seem reduced to me at all, neither is the sound level, the ads are at least 1.5 times louder than the content.
So, with the essential plan, the one I have, you pay and still have to watch ads and you cannot fast forward through them, you’re held hostage. I mute the sound until the show comes back on.
This format reminds me of what we might be faced with globally someday. All this consumerism is trashing our planet, and we have already altered our weather in significant ways living and believing in consumerism. Now that we are all trained to belong to all of these programs and have all of these subscriptions and have learned that, yes it all costs too much, but if you want to enjoy the “perks” you have to pay more for premium or NO ADS.
I’ll try to not go too dystopian here, but with dwindling resources and constant negative pressure on the environment, in combination with our normalizing this mass “subscription model,” imagine that in the near future if things get really bad and drastic, that we might very well end up needing a subscription in order to gain access to clean air, water, and nutritionally dense, clean food.
I can already hear the sales pitch or ad:
“While that air is technically approved for breathing, it isn’t the best out there, and you really shouldn’t rely on it as your sole source of breathable air. You might want to consider a subscription to our premium pure-air plus plan, where we guarantee that, while at home you will be breathing only the finest, purest air available. It’s the most economical plan for the asthmatic in your life. But if you really want to turbo-charge your savings, we also have package deals with even greater savings. For example: for a 30% off savings, our top shelf platinum plan delivers that same pure-as-it-can-be promise but includes: pure water, and nutritionally dense, ultra-clean food along with an endless supply of ultra pure air.”
I know that seems out there but, hey, again, I never thought I would someday have to pay money to get ads out of my life! Can you see the incentive that television producers have to integrate more and more of them into their shows?
They have made television so annoying because of the volume of ads they beam at you, and now they are getting paid more and more money because of the increased amount they are televising, and from all the extra revenue gained from people like me who cannot stand watching so many loud, annoying ads all the time, so we pony up even more real cash to not have to!
Let’s hope that we never have to pay for a subscription to breathe clean air and water, or to eat clean food!