Cancellation friction and consumer protection in subscription markets
Lukasz Bikowski, Khaled Elsayed, Rehab Daif, Kruthik JadhavPurpose
This paper aims to examine how firm-controlled cancellation barriers in digital subscription markets weaken consumers’ practical ability to exercise formal cancellation rights and create recurring-payment harm.
Design/methodology/approach
The paper purposively integrates transaction cost economics, behavioural economics, human-computer interaction and consumer protection, differentiates the construct from adjacent constructs by locus of causation and analytic level, derives five testable propositions and appraises evidence using domain proximity, identification strategy scale and outcome proximity.
Findings
Cancellation friction is argued to operate through exit-cost escalation and inertia exploitation, raising the risk of delayed or failed cancellation and unwanted spending. Direct subscription evidence is strongest for passive renewal defaults. Procedural friction is widely documented but lacks a dose-response estimate. Payment salience rests on adjacent-domain evidence, and the proposed perceived-control pathway remains untested.
Practical implications
The paper specifies a six-component entry-exit parity profile that can be coded from the consumer side, with a reporting rule, a worked example and stated reliability and validation requirements, and translates it into five design standards. The measure is proposed rather than validated.
Originality/value
Neither cancellation friction nor the principle that exit should be no harder than entry is new. The contribution is exit-capability erosion, defined as a reduction in a consumer’s practical capacity to complete a formally available cancellation, its integration with interface design and consumer harm in one testable model, and an operational measurement protocol.