U.S. consumers cutting streaming services to save moneyWednesday, August 23rd, 2023
Parks Associates’ Consumer Study Video Services: Shifting Demand Reveals Strategies for Profitable Growth in Video Services Market
- Consumers cutting streaming services to save money
DALLAS — Parks Associates, the premier technology research firm, recently released the consumer study “Video Services: Shifting Demand,” presenting a focused analysis of the video services landscape, including insight into why consumers are switching and canceling streaming services. The research shows the average annualized subscriber churn rate for streaming video services stands at 47%.
The top driver of service cancellations is the desire to save money – 29% of Internet households say they cancel a service to save money. Finishing a show is the next most popular reason.
“Consumer focus on price and content underscores the pivotal role of value in consumer decision-making,” said Sarah Lee, Research Analyst, Parks Associates. “When high-quality content is absent, subscriber churn becomes inevitable, making content diversity a cornerstone of profitable growth, along with consideration of pricing.”
Rapid changes in viewer behaviors, coupled with the ongoing Writers Guild of America (WGA) strike, emphasize the content conundrum in today’s video services market. A steady flow of scripted content is pivotal to viewer engagement, but it is costly and prone to disruption. Providers need to align content strategies with evolving viewer demands and greater emphasis on financial returns, which accounts for the recent rise of Free Ad-Supported TV (FAST) and Advertising-Based Video on Demand (AVOD) services. Disney recently announced increases for premium Disney+ and Hulu subscription services, while offering ad-supported service bundles at highly discounted levels.
“Video Services: Shifting Demand,” research based on a survey of 10,000 US internet households, investigates the dynamics of traditional pay-TV, streaming TV, and OTT services, dissecting subscription, ad-based, and transactional business models. This research reveals data about what consumers value most in their entertainment services and what is effective in keeping them. By examining historical data on adoption, satisfaction, and churn rates for pay-TV and OTT services, the study uncovers valuable strategies to retain subscribers and enhance revenue streams.
Parks Associates will feature this research along with executive insight on industry trends the at the sixth annual Future of Video, hosted at the Marina del Rey Marriott in Marina del Rey, CA, on November 14-16, 2023. Future of Video: OTT, Pay TV, and Digital Media early sponsors include Adeia, FPT Software, and SymphonyAI Media.
Links: Parks Associates