Report: Variety and Low Price are Streaming Must-Haves for Consumers
How are consumers spending their time on various streaming services? New research from Parks Associates shows that consumers who prefer one or more specific genres of content spend 70% of their viewing time on streaming services that offer more variety. Services like Netflix, Tubi, and AMC+ all feature a wide array of content, giving consumers more choice.
44% of consumers spend 76% of their viewing time on broad-based services while 48% of consumers use niche services for 25% or less of their viewing time.
“Services offering a variety of content categories are the foundation of consumers’ video service ensembles,” said Paul Erickson, Senior Analyst, Parks Associates. “Many niche services have been successful, including those dedicated to horror, religious, children’s, and anime content, and niche services such as ESPN+, Britbox, and Crunchyroll make up an important part of the service ecosystem. However, they are unlikely to be the primary, foundational content source within a household.”
“If services are to challenge the ‘Big 3’ OTT services (Netflix, Amazon, Hulu), they need to feature a variety of programming across genres,” Erickson said. “We will see more bundling services emerge like AMC, which bundled together its niche services Shudder, Sundance Now, and IFC Films under the AMC+ service umbrella in order to give viewers more options.”
The Parks Associates report also notes that “content is king.” However, while consumers want access to a variety of content, cost also plays a role when subscribing to various streaming services. 50% of consumers said that the cost of a service is a deciding factor. As consumers subscribe to multiple services to get a full selection of shows and moves to watch, they may be racking up a costly home entertainment bill.
Last month, the TiVo Video Trends Report showed that consumers are subscribed to an average of 8.8 streaming services. This gives folks the variety they’re looking for, but it comes at a cost.
“A hybrid pricing approach meets consumers where they are,” Erickson said. “Maximizing revenue potential with hybrid pricing will help services finance the growing cost of content library growth.”
Going forward, streaming services will have to focus on giving consumers a variety of content while keeping costs low. To cater to consumers’ budgets, many of the big streaming services, including Hulu, HBO Max, Paramount+, and Peacock, offer more budget-friendly options. Disney+ offers its bundle. Peacock offers a free ad-supported tier, while both HBO Max and Paramount+ allow subscribers to choose from a cheaper, ad-supported option and a pricier, ad-free subscription. Recent studies have shown that consumers don't mind watching ads, especially if they can save money while doing so.