Rising costs see Brits already canceling TV streaming services
The seemingly unstoppable rise of subscription streaming services could grind to a halt as a spiraling cost-of-living crisis is predicted to evaporate discretionary spending, according to an extensive Kantar survey.
Britons, especially younger demographics, are increasingly switching off
The media analytics group found that Britons, especially younger demographics, are increasingly switching off, with 215,000 fewer households stumping up for at least one paid subscription in the three months to March versus the prior quarter in a bid to save some cash.
Subscriptions slip
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In the first quarter 58% of households (16.9m homes) had access to one paid subscription service – a 215,000 decline from the previous three months
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Across the period cost-conscious consumers canceled 1.51m streaming video-on-demand (SVOD) services – a significant jump from the 1.04m cancellations recorded in the previous quarter
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Underlying the sea of red is a widespread consumer desire to ‘save money,’ with 38% now counting their pennies – up from 29% in the last reporting period
Churn rates up almost across the board
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While Netflix and Amazon Prime Video benefit from their market leader status, ensuring they are the last services to be cut in any purges, the picture is less stable for challenger services lower down the pecking order such as Britbox, Now and Discovery+
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Just 3% of households signed up to a new SVOD provider in the first quarter, down from 4.2% a year earlier
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Amazon Prime Video led the way in new subscriptions in the first quarter, laying claim to a share of 27% – almost double that of Disney+ on 14%
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Now claimed the third spot with an 11% share, while Netflix – which has far less room to grow – slipped into single digits with a 9.4% share
Advertising to the rescue?
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In this new reality of a dwindling customer base, the issue of advertising has once again reared its head, with Netflix in particular under pressure to drop its longstanding objections to drive revenue in a saturated market
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Dominic Sunnebo, global insight director at Kantar, said: “With many streaming services having witnessed significant revenue growth during the height of Covid, this moment will be sobering.”
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Recommending new marketing and content strategies to reverse the slide, Sunnebo added: “As SVOD providers look at different strategies to sustain revenue, advertising could be a logical option. In the US, NBCUniversal’s Peacock service has seen success with a multi-tiered model that incorporates advertising at a lower cost to consumers. As households tighten their purse strings, many could potentially welcome a similar model from their favorite SVOD provider in Great Britain.”
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In a bid to diversify Netflix has already entered the gaming arena as it positions itself as a one-stop shop for household entertainment
Content created with:
Kantar worldpanel
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