Could Two Pairs of Leggings Really Cost You £5,000?

Clare Lane's experience with Fabletics highlights a growing concern over subscription traps in the UK, where consumers unknowingly commit to long-term payments for products or services. After purchasing leggings in 2017, she discovered that she had been billed nearly £5,000 over seven years for a subscription she believed was a one-off purchase. This case raises important questions about transparency in subscription models and consumer responsibility.

Last updated: 26 October 2023 (BST)

What’s happening now

Clare Lane's unintended subscription to Fabletics has sparked discussion about the implications of subscription services in the UK, especially among online retailers. Many consumers like Lane are unaware of the automatic billing that follows what they perceive as a one-off purchase, leading to significant financial losses. Fabletics has since refunded most of her payments, but the incident underscores the need for clearer communication regarding subscription terms and the responsibilities of both companies and consumers.

Key takeaways

Clare Lane discovered she had unknowingly spent nearly £5,000 on a Fabletics subscription over seven years.
The incident highlights the issue of "subscription traps" affecting consumers in the UK.
Fabletics claims to inform customers about subscription terms, but many users report confusion and lack of clarity.
New regulations aimed at preventing subscription traps are delayed until autumn 2024.

Timeline: how we got here

The timeline of events leading to Clare Lane's discovery of her Fabletics subscription is as follows:

2017 (July): Clare Lane purchases two pairs of leggings from Fabletics, assumed to be a one-time transaction.
2023 (October): While changing credit cards, she discovers ongoing monthly payments of approximately £50 to Fabletics for a VIP membership.
2023 (Late October): Lane begins correspondence with Fabletics to reclaim her funds, ultimately receiving a refund for most of her payments.
2024 (Spring): New regulations regarding subscription transparency are planned but later delayed to the autumn of 2024.

What’s new vs what’s known

New today/this week

Recent revelations from Clare Lane and other consumers have brought attention to Fabletics' subscription model, prompting discussions about consumer awareness and protecting rights against unforeseen financial commitments. The company's general manager has acknowledged the challenges faced by customers in navigating their subscription service.

What was already established

Fabletics has been operational since 2013 and has marketed itself as a pioneer in subscription-based fashion. The company claims to have clear communication regarding membership terms, which some consumers dispute. The ongoing issue of "subscription traps" has been recognised by the government, leading to proposed regulations aimed at protecting consumers.

Impact for the UK

Consumers and households

For UK consumers, the implications are significant. Many individuals may unknowingly find themselves in a similar situation, leading to unexpected financial strain. The government's estimate of £1.6 billion lost annually to unwanted subscriptions underscores the scale of this issue, affecting household budgets and financial planning.

Businesses and jobs

The subscription model, particularly in retail, raises questions about consumer trust and business practices. Companies like Fabletics may face increased scrutiny and potential changes in their operational models to comply with new regulations. This could create both challenges and opportunities for businesses that adapt to consumer demands for transparency and ethical practices.

Policy and regulation

Upcoming regulations aimed at curbing subscription traps are essential for protecting consumers. These regulations will force companies to provide clearer information regarding subscription terms and make cancellation processes more straightforward. However, the delay in implementation raises concerns about the effectiveness of current consumer protections.

Numbers that matter

£5,000: Total amount Clare Lane paid to Fabletics over seven years.
£1.6 billion: Estimated annual losses for UK consumers due to unwanted subscriptions.
£59.99: Monthly fee for Fabletics' VIP membership service.
£20 million: Reported revenue for Fabletics in the UK for 2024.
30 months: Time taken by some customers to discover ongoing subscription payments.

Definitions and jargon buster

Subscription trap: A situation where consumers are automatically enrolled in recurring payments without clear communication.
VIP membership: A subscription service offering benefits, such as store credits, in exchange for a monthly fee.
Trading Standards: A UK government service aimed at protecting consumers and ensuring fair trading practices.

How to think about the next steps

Near term (0–4 weeks)

Consumers should review their bank and credit card statements for any unfamiliar recurring charges. If they discover unwanted subscriptions, they should take immediate action to cancel them and seek refunds where applicable.

Medium term (1–6 months)

As the new regulations are set to be introduced in autumn 2024, consumers should stay informed about their rights regarding subscriptions. It may also be advisable to shop with companies that have a clear policy on subscription transparency.

Signals to watch

Updates from the government regarding the new subscription regulations.
Consumer feedback on companies' subscription practices.
Changes in Fabletics' customer service policies and practices.

Practical guidance

Do

Check your bank statements regularly for any unexpected charges.
Research subscription terms before making a purchase.
Contact customer service immediately if you suspect you are being charged for a subscription.

Don’t

Ignore recurring charges; they may add up over time.
Assume all purchases are one-off; read terms and conditions carefully.
Delay contacting your bank or credit card provider if you encounter issues with a subscription.

Checklist

Review all subscriptions you currently have.
Ensure you understand the terms associated with any subscriptions.
Set reminders to review your subscriptions every few months.
Be aware of promotional offers that may lead to unintended subscriptions.
Keep records of any communications with subscription services regarding cancellations and refunds.

Risks, caveats, and uncertainties

While many consumers face challenges with subscription services, it's crucial to approach these situations with caution. Not all companies operate with the same level of transparency, and individual experiences may vary. Additionally, potential regulatory changes may shift how subscriptions are handled, but until implemented, consumers must remain vigilant about their purchases and rights.

Bottom line

The situation with Clare Lane and Fabletics exemplifies the growing concerns around subscription traps in the UK. It serves as a reminder for consumers to be proactive in managing their subscriptions and understanding their financial commitments. As new regulations are anticipated, this may provide a turning point for consumer rights in the subscription economy.

FAQs

What is a subscription trap?

A subscription trap refers to situations where consumers are automatically enrolled in recurring payments without clear and explicit communication about the terms, often leading to unexpected financial losses.

How can I check for unwanted subscriptions?

To check for unwanted subscriptions, regularly review your bank and credit card statements for unfamiliar charges and consider using budgeting apps that can help track recurring payments.

What should I do if I discover an unwanted subscription?

If you discover an unwanted subscription, contact the service provider immediately to cancel it. Keep records of all communications and request a refund if applicable.