SVOD

Key Takeaways

• The number of average monthly streamers increased 17% year-over-year and the time spent streaming increased 31%.
• On linear, 33 channels are viewed by the average user, but the average streaming user only has three to four apps. While changing channels on linear is seamless, changing between content happens more within the app, as changing apps isn’t frictionless. This makes the marketing barrier much greater.
• Samsung Ads created a churn ratio which is lapsed users within 12-months divided by active users for the current month. They found that in Q3 2021, the overall churn ratio was 4.8 past users to one current one, while one year later it went up to seven (seven users churned for every one that stayed).
• TV apps were divided into three tiers. Tier 1: the top 20% of apps based on average monthly user count, Tier 2: The next 20% based on average monthly user count, Tier 3: the 60% of apps with the smallest monthly user count.
• The churn ratio was different depending on what tier a TV app was on. Tier 1 apps in Q3 of 2022 saw a 1.7 churn ratio, tier 2: 3.5 and tier 3: 9.7.
• When it came to user share of the average TV app, 23% were new users, 24% returned users and 53% were retained users. With time share, retained users represent 73% of time spent on the average app (new users 14%, returned users 24%).
• How can platforms increase retention? Fifteen percent of respondents said a deep library of exclusive content was most important. They also like seeing new content frequently.
• Cost is also a factor. Ten percent said they used a platform because it was lower cost than others or free. Twenty-one percent said they would try a new service that was free or low cost. A high cost was also the number one factor of cancelling a streaming service (30%).
• The report found a 6% retention rate among hybrid TV apps.

Key Takeaways

• The rapidly changing landscape: 70% of U.S households have at least one connected TV; Roku and Amazon are still among the top OEMs; 94% of viewing on linear is still live or same day.
• Growth is due to the increase in streaming especially FAST which are having double digit growth. But how will the landscape unfold as, and if, the economy downturns. TUBI expects one in three streamers to reduce their channels.
• There has been a rapid decline in pay subscriptions over the last 5 years from 66% to 43% with a concomitant rise in cord cutters. Cord-nevers have leveled off at 13% having risen to 20% in 2020.
• COVID caused a rapid bump in viewing of TV and video, it retreated during 2021. But now we are seeing a renewed growth in the total amount of television and video. While there is a slow erosion, linear is still alive and well.
• One important story is the growth overall of exposure to video through different channels such as gaming and social. But it is content as well as mobile availability that is driving growth. Nearly 50% of linear content consumed is news, sports and movies. However, movies have lost a 5% share over the last 5 years, no doubt the loss coming from the growth of SVOD.
• Sports occupies a unique place in content. It accounts for more than half of all social media posts, and sports fans index at 124 for pay tv subscriptions.

Key Takeaways

• The results showed that 15-20% of the time, when an ad is playing on such an external device, the TV is off. Every publisher and device combination were affected.
• This doesn’t happen with most Smart TVs, although there is one that goes into a low power mode (Fisher wouldn’t say which).
• The initial study did not look at input switching, such as when someone switches to a gaming console or cable box. But that is part of phase two, along with how time of day affects this phenomenon (i.e., people falling asleep in front of the TV) and expanded data sets to look at linear TV consumption.
• GroupM is now testing what combinations of devices and cables make the problem better or worse and why. Older HDMI cables and having a sound bar can interrupt the power on/off signal, they found. Pucks and sticks, and other devices hidden behind TVs, also have a higher occurrence of continuous play.
• Prompts that ask, “Are you still watching?” help avoid this. Some platforms wait four hours to ask, which is too long, but with short-form episodic viewing, asking too often can annoy viewers.

Key Takeaways

• As SVOD has become mainstream, subscriber growth does not come from non-streamers anymore, but largely from churn between services. This makes churn an important issue that requires careful analysis to inform providers’ strategy.
• Churn is not simply a reflection of the quality of the service. The analyses show that there are viewer segments with different predispositions to churn. As a result, it is important to look at the churn rates among each segment to get a full understanding of consumer sentiment.
• Not all churn is negative. Some churn, driven by engaged viewers, is indicative of a healthy service. Subscribers with higher churn rates are likely among the most important to the content subscription platforms, as they are deeply involved in the content and are most active on social about that content.
• To manage churn and resubscription, we need to recognize the different motivations of viewer segments. This is important for the health of a streaming business.