How Peacock’s Unique Strategy is Leading to Streaming Growth
Peacock is enjoying its moment in the sun these days, and why not? The service more than doubled its paid subscriber count in 2022, rising from 9 million at the start of January to 20 million by year's end. Additionally, there are potentially more paid users on their way, as in April millions of Comcast Xfinity internet customers currently getting the service for free will be asked to pay for it instead.
At a time when most streaming services have their noses to the grindstone, cutting content and working out complex formulas for when they’ll be able to turn a profit, Peacock is doubling down on its impressive growth. NBCUniversal executives recently participated in a Parrot Analytics virtual conference to explain what they’re doing, and why it has been so successful.
Peacock President Kelly Campbell explained that while original shows like “Poker Face” are key for attracting new subscribers, it’s the service’s selection of library content that really sets it apart.
“When you think about the role that content plays on a streaming service, we look to content both to attract new audiences, but also to get people viewing more and establish a more loyal relationship between the viewer and Peacock,” she said. “Our library and our licensed titles, these are really important to drive viewership, and build that more loyal relationship between the consumer and Peacock. Think about, for example, ‘That ’70s Show.’ Hundreds of episodes, so that translates to hundreds of hours of viewership on Peacock.”
@KellyCampbell, President of Peacock, shares her perspective on the value of Peacock’s library in maintaining a strong relationship between the platform and the viewer. pic.twitter.com/thEaT7AFgj— NBCUniversal (@NBCUniversal) February 14, 2023
Campbell’s point about the importance of library content is hard to argue. Original programming has been clearly demonstrated to be a top driver of new sign-ups, but more users than ever before are signing up for streaming services for just one show, then canceling before their next billing cycle. To keep users from cycling away, streamers must keep a library stocked with familiar shows, which keep subscribers entertained until the next original they want to see is ready for release.
The Peacock catalog has quite a few of these series available. From “That ’70s Show” to “The Office” to “Parks and Rec,” Peacock has a wide array of series that offer so-called “lean-back” viewing. This style of TV watching involves putting on a comforting, familiar show that audiences can engage with as much or as little as they want, and some industry executives believe as much as 80% of all TV watching falls into this category.
The relationship between library content and originals on Peacock highlights the way that parent company Comcast views the service as a part of its media ecosystem. As one of the largest pay-TV providers in the United States, Comcast is facing a problem that all cable and satellite companies must confront: rapidly declining traditional user bases. Peacock is not just a streaming service for Comcast, it’s also a way to help the company transition from the linear past to the digital future.
As that transition continues, one of the biggest issues for the company is maintaining quality control across its remaining linear channels as well as Peacock. NBCU’s Television and Streaming Chairman of Entertainment Content Susan Rovner says it’s about maintaining a company-wide focus on the most prized content.
“Even with the volume of content that there is, we succeed most when we really focus on the shows that we love, where we market them, publicize them, we all come together and focus on them, we win,” she said.
Susan Rovner (Chairman, Entertainment Content, NBCUniversal Television and Streaming) weighs in on her approach to quality control when developing content for a wide variety of platforms. pic.twitter.com/Xb0jTcPTDu— NBCUniversal (@NBCUniversal) February 14, 2023
It sounds as if each segment of the company is in lock-step when it comes to content decisions. That unified strategy is what Comcast is counting on to help it continue moving away from the linear side of its business. Considering Peacock is expected to hit peak losses this year and start moving toward profitability in 2024, those tactics seem to be paying off.
Part of Peacock’s strategy as it turns toward profitability is monetizing its customers to the fullest. The service took a big step in that regard earlier this year, when it stopped offering its free, ad-supported tier to new users. Analysts will be anxiously awaiting the company’s next quarterly earnings report to see if that decision paid off, but it’s likely that Peacock will continue forging ahead with its unique strategy regardless of the outcome.
Peacock is a subscription video streaming service from NBCUniversal that includes original shows, blockbuster movies, and classic television series. Peacock is home to “Yellowstone,” and “The Office,” as well as original hits like “Poker Face” and “Bel-Air.” You can also watch live sports including Sunday Night Football, Premier League, and exclusive MLB games. Peacock is also the exclusive home to many WWE events like WrestleMania. Premium Plus subscribers can stream their local NBC feed in all 210 markets.
Peacock includes news, entertainment, sports, late-night, and reality from various NBCU properties including NBC, Bravo, and E!.
Peacock also includes the entire library of Bravo shows and has exclusives like “Below Deck: Down Under.” They also include live and on-demand access to Hallmark channels.
The company has acquired the rights to many classic shows like “Parks and Recreation,” and the entire Dick Wolf library including “Law & Order” and “Chicago Fire.”
The service also features blockbusters and critically-acclaimed films from Universal Pictures, Focus Features, DreamWorks Animation, Illumination and content acquired from Hollywood’s biggest studios.