How to combat Zombie Subscriptions

It’s easy for businesses to fall victim to the phenomenon of zombie subscriptions or zombie spending; a situation that can drain your company bank account without you even realizing it.  

"Zombie subscriptions" or "Zombie Spending" is a term used to describe ongoing SaaS (Software as a Service) subscriptions that businesses no longer use or even remember they have subscribed to. Zombie subscriptions are easily overlooked and can be a major financial drain on businesses. Businesses need to be aware of and actively monitor these subscriptions to make sure that they don't have a negative impact on their overall budget.  

The Impact of Zombie Subscriptions 

The term "zombie" comes from the fact that these subscriptions are often forgotten about, but they continue to "live" by taking money from your company’s bank account every month or year. When businesses continue to pay for SaaS subscriptions they no longer use, it's essentially money down the drain. Over time, these small subscription fees can add up to a significant amount of money lost, which can negatively impact the business's financial health.  

Additionally, zombie subscriptions can create clutter and confusion within the business which can impact the business’ overall efficiency. Because keeping track of multiple subscriptions can be challenging, particularly when it comes to billing and cancellation dates, this can lead to frustration and anxiety for teams responsible for managing these subscriptions. 

These subscriptions can negatively impact the health of your company’s IT environment as well. Often zombie subscriptions happen when there is little visibility and management into the subscription process. This happens when teams and individuals purchase software on their own without the IT team knowing or managing the application. This eventually leads to a redundant and inefficient tech stack where a company has several tools that may do the same thing, without the IT team even being aware.   

So, how do you prevent zombie spending from happening in your company? An article written by the team at Ramp outlined five business best practices to prevent zombie subscriptions.  

How to Prevent Zombie Subscriptions 

Modifying policies and upgrading expense systems allows companies to better control what their employees are purchasing with their company funds. According to Ramp, controlling how employees are using company funds for subscriptions is an important component to prevent zombie spending. Companies should thoroughly analyze company spending to expose potential zombie subscriptions, by giving IT teams visibility into this spend, they can help to control it too.  It is important that a companies' IT team knows which tools perform similar functions to reduce redundancies, however we should note that this level of analysis can be cost-prohibited and taxing on company personnel/teams.  

To avoid zombie subscriptions, businesses need to keep track of all employee spending with company funds. This can be done using a spreadsheet, budgeting app, or subscription management tool. 

IT teams should be monitoring spend and usage of company applications regularly. By reviewing subscription data, IT teams can look for trends that may signal the presence of zombie subscriptions. For example, if there is a high number of employees or teams who have not used a service in the past month, this may signal to the IT team the presence of zombie subscriptions that need to be addressed. Including IT teams in the deciding and purchasing phase of SaaS subscriptions will give them the visibility they need to monitor these subscriptions and will ultimately pay off in the end.  

Zombie subscriptions can be an expensive and frustrating problem for businesses. By proactively monitoring company usage and regularly reviewing subscription data, businesses can mitigate this issue and save money in the process. 

According to Ramp, controlling how employees are using company funds for subscriptions is key to preventing zombie spending. To learn more about how your organization can protect against zombie subscriptions, contact us today.