How streamers win–and keep–customers
In a recent survey about the impacts of the pandemic and the overall sentiment of U.S. subscribers, Recurly found that 87% of respondents have a subscription to at least one streaming video service and 46% have a subscription to at least one streaming audio service. The increasing ubiquity of streaming subscription services leaves little to question about their popularity among consumers, particularly the Gen Z and Millennial generations. To rank among the highest-rated streaming subscription services like Netflix, Amazon Prime Video, and Disney+, subscription businesses need to understand consumer behaviors and motivations that promote retention and preserve subscriber loyalty.
In this article, you’ll learn how streaming subscription services and changing consumer habits have existed harmoniously and how they continue to thrive in an economy captivated by recurring revenue businesses.
Streaming service industry trends
At the core of any successful subscription offering is the subscriber experience. And an ideal subscriber experience starts with studying subscriber wants and needs for informed decision-making. Significantly, the survey explores the reasons that consumers subscribe to goods and services. These include brand preference, access to discounts as subscribers, help managing a budget, and more. However, the prevailing motivation is content, and not just any content–exclusive content, as well as value and convenience.
Our survey results reveal that 40% of consumers rank exclusive access to content or services as the main reason for signing up for a subscription service. Unlike a box of the month, streaming subscription services may give subscribers special access to coveted content such as a highly anticipated series or film.
When consumers evaluate a purchase, they consider the value they will receive in exchange for a recurring payment. In this case, the value of a streaming subscription service is presented in the form of content. And the more exclusive the content is, the higher the value is to the subscriber.
How consumer sentiment affects demand
As a consequence of the pandemic, 91% of U.S. consumers are concerned about inflation and its impact on the cost of goods and services. Coupled with the recent news about Netflix losing 200,000 subscribers, many streaming subscription services are struggling to get a grasp on subscriber churn.
However, despite climbing costs and unpredictable consumer behaviors, 68% of consumers still signed up for another streaming video service and 31% signed up for another streaming audio service in the last year. Furthermore, the same subscribers expect to use streaming video (78%) and streaming audio (36%) subscriptions the most this year.
Pertinent value remains a strong factor in subscribers’ purchasing decisions. For streaming services, this is an opportunity on which to capitalize. From promotions and free trials to the freedom to pause as a subscriber, streaming subscription services can strategically adapt to developing consumer behavior trends. Rising costs may be inevitable. However, how these changes are packaged and delivered plays a vital role in influencing consumer perceptions of your business.
The smartest streaming subscription services don’t let value decline as the pandemic shifts the economy. Instead, they create value in novel ways. Recommended content and complementary goods and services in new forms are just a couple of ways to retain subscribers and remind them of the value they receive from your streaming subscription service.
A change in consumer expectations
Nowadays, with just a few simple clicks to manage an account, streaming subscription services have proven that convenience is more impactful to the subscriber journey than many initially thought. While traditional subscription convenience is typically defined as routine home deliveries, in the streaming space, convenience can also refer to the ease of setting up, changing, or canceling a subscription.
Most survey respondents (62%) value this accessibility when considering a new subscription. Streaming subscription services, which are largely self-managed by the subscriber, must make account changes as easy as possible. If streamers have an intelligent response to changing behaviors and motivations, the subscriber experience faces little disruption. These considerations should extend into thoughtful dunning strategies and even the renewal or cancellation experiences for a seamless ordeal throughout the journey. While the decision whether or not to continue with a subscription is ultimately in the hands of the customer, the touchpoints throughout any subscriber journey contribute to the overall perception of a service.
The success of streaming subscription services
Streaming subscription services are one of the few businesses that can repeatedly present exclusive content as its primary value driver. From a consumer’s perspective, this is one of the most enticing reasons to subscribe to a service, alongside relevant value and flexibility.
Undoubtedly, streaming media subscriptions have a competitive advantage over their counterparts. But that edge only remains intact when the subscriber is placed at the center of a thoughtfully planned customer journey.