Video streaming trends have evolved dramatically in the last 6-8 months.
The coronavirus pandemic has left many of us with idle time on our hands, largely stuck at home with few options for diversion. The best intentions of baking that sourdough loaf or learning to knit are easily set aside for the countless on-demand video options available. It’s no surprise then, that streaming media services have seen a lift in spending since March.
What do Data show about Video Streaming Services?
In fact, in Q2 of this year, the amount of time Americans spent streaming video on a weekly basis increased from 81.7 to 142.5 minutes year-over-year. Still, even with more Americans indulging their couch-potato-tendencies than ever before, new data based on $3 trillion in consumer spend surprisingly shows that it isn’t any easier to predict their behavior — particularly during a pandemic.
The winter months are approaching, and with consumers preparing to hunker down even more so than before, SVOD (streaming video on demand) services must get creative in order to keep their positive momentum going. By looking at how SVOD spend has evolved over the last several months, brand marketers in the space will be better equipped to engage with only the “stickiest” spenders that are most likely to turn into repeat customers.
On-Demand is In-Demand
Between March 5 and July 31 of this year, 27 percent of consumers joined a new SVOD service, an increase likely induced by the quarantine boredom and blues. Seventeen percent of these users were first-time SVOD customers, and the remaining 10 percent added to their existing subscriptions.
The SVOD space is a crowded one but brands can keep the momentum going with fresh tactics.
For instance, by bolstering their roster of TV shows and movies, or by launching an original series, SVOD brands are tapping into new pools of potential customers by broadening their content. Sports, award shows and other events that were previously only available via cable are now being offered by Video streaming providers as brands attempt to entice potential customers away from the competitors and onto their own channel.
SVOD Customers: Not as Sticky as Expected
Whether the pandemic inspired consumers to add to their roster of video streaming subscription services or sign up with one for the very first time, SVOD brands are now faced with the challenge of keeping all of their users subscribed long-term, which has proven to be trickier than expected.
Even with so many Americans glued to the TV, 15 percent of SVOD customers actually lapsed between March 5 and July 31, halting their subscriptions altogether.
As the recent shutdown of Quibi can attest, competition for customers is fierce. SVOD brands need to address the churn of fickle subscribers by focusing on smart acquisitions, retention and importantly, media efficiency. Reallocating budgets that are no longer useful in our COVID-era, like event marketing for instance, and putting them towards measurable, low-risk performance media, is a smart tactic.
Now’s the Time to Get Creative
The quick churn of SVOD customers combined with the density of the industry means that brands need to think outside of the cable box in order to attract and retain subscribers.
SVODs should consider alternatives to antiquated methods like demographic and even interest-based targeting and instead use purchase data, or purchase graphics, to anticipate what a consumer will buy in the future based on what they’ve purchased in the past. This can allow a marketer to target customers who typically subscribe for the long run or, perhaps just as important, identify households with multiple streaming subscriptions and likely at risk of churn.
For example, our data shows that heavy subscription users are five times more likely to spend at hair salons, and three times more likely to shop in jewelry categories. Armed with these spend indicators, marketers can better understand their customers, reaching those who are stickiest and avoiding the likeliest to cancel their subscription.
Marketers for SVOD brands are in a unique position due to the COVID-19 with a massive opportunity to hook users in and keep them long-term. With this streaming trend likely to continue into the colder seasons, SVOD services should look at consumer spend to target only the likeliest, stickiest spenders and continue to provide a valuable experience to drive loyalty long-term.