Mastercard to set a new standard for subscription trials

We are moving past the consumer oriented e-conomy where subscription services was a “thing” to do. Today — we subscribe to services 24x7, 365 and we love it.

Many providers of subscription service even allow us to try-before-buy. This behaviour — the trial experience — has many forms and customer journeys, which is why it is important to understand how important the latest news announcement from Mastercard is. To you as a consumer. And to you as a merchant providing subscriptions.

Mastercard is procecting the subscriber with new announcements

By January 16th 2019 — Mastercard took a stand to protect the user. Read their announce here. https://newsroom.mastercard.com/2019/01/16/free-trials-without-the-hassle/

To you as a consumer

Rest assure — as a consumer, you have just received a stronger and more safe reason to continue using subscription services. Even more so, I predict the announcement of Mastercard will only fuel the growing subscription industry.

With the announcement, Mastercard require that merchants — the company providing your subscription service — let’s say Netflix — require a formal approval of subscription activation. Typically some merchants, have required that though you sign up for a trial, you must provide a method of payment and that this trial automatically will activate if you do not cancel the trial.

Mastercard, and probably VISA following soon, will require a direct consent for converting the trial to a subscription. This is keeping you safe as a consumer.

To you as a merchant

As a merchant, you may or may not provide cardless trials. If you require the customer to provide means of payment beginning a trial (example try a media service for 14 days), Mastercard will now require that you can document, provide evidence of consent upon converting the trial from a period of free payment to a paid subscription. Updating your terms of service, privacy policy is no longer a consent. The customer will have to log in during the end of the subscription trial to ACTIVELY consent the activation.

Our recommendation is:

· Provide cardless trials if you provide a digital non-physical subscription service. Reduce the time available for that trial if there are high costs associated to the product.

· If you provide a physical product often with logistical costs associated, consider how the trial period is handled by selling a smaller portion of the product, or simply provide a first billing cycle of 100% discount.

How Upodi will deal with the message

Upodi believe in the message and announcement of Mastercard. We believe in the protection of the consumer and will adopt the implementation using our subscription software. Our forthcoming trial management enhancement to the platform will be postponed, adopting the triggers and consent required from Mastercard. We do not believe that Mastercard will be alone in this — VISA, Amercian Express and others will soon follow.

You can read more about Upodi here — www.upodi.com and be sure to read the update from Mastercard here — https://newsroom.mastercard.com/2019/01/16/free-trials-without-the-hassle/.