It is clear that the streaming market is becoming increasingly crowded, with new video services launching on what seems like a weekly basis. In such a competitive landscape, where consumers are presented with almost endless options, providers need to be smart about how to both attract and retain users. Have we reached saturation point, at least in some markets? And if so, how can new as well as existing video services continue to give viewers a reason to subscribe?Late last month, American streaming service, Paramount+, accelerated its global expansion by launching in the UK and Ireland. The service includes a broad offering of content from several well-known brands as well as some highly anticipated exclusive content. The UK is widely considered one of the world’s most competitive markets where the opportunities for OTT users are almost unlimited. How can yet another big-name streaming service compete in such a densely populated environmen
Consumers are not only flooded with choice but with rising inflation, many are also evaluating ways to cut costs. Limiting the number of video subscriptions is an easy way to reduce monthly outgoings and many services are likely to feel the pinch. Now, more than ever, it is important to launch with an attractive initial price point to encourage consumers to give your service a go. Once a user has made the decision to subscribe, you will obviously also need to continuously provide them with good value for their money.Even well-established providers are having to re-evaluate their pricing structure. Take Netflix, for example, who in response to falling subscription revenue, has announced it will launch an entirely ad-supported tier. Understanding what your target audience is willing to pay is crucial, as is offering different levels and options to attract as many subscribers as possible. In times of macroeconomic uncertainties, not every customer will be keen on spending a lot of money on a wealth of different offerings. However, there is also a significant group who would quickly get annoyed with a fully AVOD-powered service. For some providers, retaining users may come down to offering a hybrid model, where lower subscription fees are coupled with advertising. Another alternative could be to offer a lower ad-funded service tier or an option that only provides access to selected content.
It goes without saying that in an increasingly competitive market, service providers need to offer their viewers something different. This is especially true for new entrants, where users need a reason to sign up on top of an often long list of existing subscriptions. For some service providers, the battle for subscribers is best fought with exclusive content. The big studios are of course in a strong position with big budgets and vast libraries that they can choose to only release within their own ecosystems. However, we are also seeing a rise in niche services that deliver a very specific type of content to a dedicated group of fans. While the potential audience is much smaller, consumers who subscribe to these offerings are typically very loyal.These days, most video services offer users a similar array of features, and many consumers have grown to expect the availability of certain core functionalities. However, things move quickly and for some service providers, experimenting with more innovative features can serve as an effective hook. This could, for example, include XR functionalities, delivering something unique and immersive that goes well beyond the traditional viewing experience. With the right tools in place, providers can bring existing content and applications into an extended reality environment, or even develop entirely new XR compatible services. Similarly, social watching is a feature that proved immensely popular during covid but has shown to have longevity also in a world post the pandemic.
Attracting users is one thing; retaining them is a different story. While it is certainly important to provide customers with a unique offering at an attractive price point, the real secret to success lies in truly understanding your audience. As I have previously discussed, this goes way beyond the collection of data (something which most, if not all, service providers have been doing for some time). The real value lies in ensuring that your data is actionable, and that you leverage it to optimize the user experience.In order to retain users, service providers need to provide an experience that is not only streamlined, but also highly relevant to each individual viewer. The key to doing this is to package your data in a way that allows you to experiment with different UX iterations in a bid to understand how to provide the most value for different segments of your audience. It is often wise to start by applying changes to a small section of your users, measure what impact this has on engagement, and then choose whether you should adapt your service accordingly.Ultimately what works for one service will be different for another and there is no one-size-fits-all approach. However, if a video provider pays close attention to these factors, they will have a chance at success even in an increasingly crowded market.
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