BROOMFIELD, Colo. & LONDON--()--Recurly, a leader in the subscription management and billing platform, today released its ninth annual State of Subscriptions report. The report analyzes data from millions of consumers providing deep insight into the massive subscription economy’s evolution. This report offers strategies and one-of-a-kind solutions for merchants to overcome the industry’s ever-evolving nature and subscription challenges to drive growth.

In a year when subscriber acquisition rates dropped to 2.8% (down from 4.1% in 2021), retention has emerged as the cornerstone of subscription success. Strategies like personalized engagement, flexible payment options, and loyalty incentives are no longer optional—they are essential to thriving in this dynamic market.

“This data underlines why more and more businesses across industries from travel to fashion are turning to subscription models,” said Joe Rohrlich, CEO at Recurly. “Even as customer acquisition declines, retention is increasing—a clear sign that consumers want to find and stick with subscriptions that best fit in with their lives. Every subscriber wants to be treated to the most personalized experience possible, and the onus is on businesses to provide products and services that create best-in-class customer experiences.”

Some of the top findings from the 2025 State of Subscriptions report include:

- The shift to retention: Acquisition rates dropped from 4.1% in 2021 to 2.8%, signaling the continued shift toward profitable growth. Subscription businesses continue to focus on cost effective acquisition strategies while improving churn through subscriber engagement and loyalty.

- Declining free trial effectiveness: Free trial conversion fell from 46% to 33%. The focus is shifting to attracting high-quality subscribers, as increasing market penetration in many industries has decreased the effectiveness of free trials.

- Subscriber expectations evolving: Consumers demand flexibility—preferred payment methods, diverse plan options (both recurring and one-time), frictionless plan changes, and custom bundles.

- Cancellation isn't goodbye: Subscriptions are cyclical, with 20% of acquisitions being returning subscribers. Over $200M was generated from subscribers who re-subscribed after pausing. Businesses offering a pause option saw 25% of subscribers pause instead of canceling.

- Fraud and Alternate Payment Methods (APMs) on the rise: Fraudulent transactions increased by 29%, mainly targeting the sign-up flow and credit/debit cards. There was also a 19% year-over-year (YOY) increase in alternative payment method (APM) usage, which helps mitigate this risk while aligning with consumer preferences.

"Success in 2025 depends on subscriber experience and deepening loyalty," said Taylor Putnam, Principal Commercial Product Manager at Alaska Airlines.

Subscription offerings aren’t new, but brands like Alaska Airlines, Paramount +, Chuck. E. Cheese, FabFitFun and more are increasingly recognizing the value of subscriptions and are using these models as a way to ensure their businesses stay profitable and sustainable. Recurly’s data shows that 58% of consumers have subscribed to one to three services in the past year. It’s clear that there is a healthy demand for more businesses to adopt subscription models.

“Recurly's integrated billing and payment options have allowed us to focus our resources where they matter most: delivering value to our students,” said Bryan Gregory, Director Of Engineering at Chegg.

Download the full Recurly 2025 State of Subscriptions report here and register to attend Recurly’s 2025 State of Subscription: Behind the data webinar on February 5, 2025 for a live discussion diving deeper into the key insights, takeaways, and the best ways to integrate this data into your own business strategies.

ABOUT RECURLY

Thousands of innovative companies across digital media, streaming, publishing, SaaS, education, consumer goods, and professional services industries rely on Recurly to unlock transformational growth using subscriptions. Recurly’s all-in-one, integrated platform removes the complexities of automating subscription billing at scale by enabling teams to manage and optimize their subscriber lifecycles with ease. Category-defining companies including Sling TV, Twitch, FabFitFun, Paramount+, Lucid Software, and Sprout Social have chosen Recurly to manage billions of dollars in recurring revenues, future-proof their recurring billing and revenue management, and recover billions of dollars in lost revenue due to churn. For more information, visit recurly.com.