A new piece of research confirms what we’ve been expecting: The world may be coming out of its pandemic-induced haze, but customer desire to be snuggled up under a blanket in front of their favorite on-demand content has never been greater.
Researcher JD Power says that the mass quarantine of 2020 has acted as the impetus for a shift in customer behavior that will forever alter the way content in consumed.
In fact, while the a la carte nature of streaming could lend itself to less customer spending, it appears the inverse is happening. The more choices, the more temptation to get access to a specific library.
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Viewers increased their streaming subscriptions to an average of 4.5 streaming providers in June 2021 from 3.9 streaming providers in December 2020, the survey finds. Meanwhile, the average monthly household spend on all streaming services increased commensurately to $55 from $47. That’s up a whopping 45% since last April.
What accounts for that change in spending? Report author, Ian Greenblatt, MD of TMT Intelligence at JD Power One, fingers one culprit as price increases.
READ MORE: Despite Return to ‘Normal,’ People are Spending More Time and Money on Streaming Services Now than During Height of Pandemic (JD Power)
Netflix got the ball rolling in October 2020, increasing the price of its premium service. In March, Disney raised the price of Disney+ to $8 a month, or $80 per year. Disney has also given ESPN+ two price increases this year, the second which goes into effect on August 13, which has forced the service’s annual plan increase by about $20 this year alone.
“Streaming services continue to add value to justify any past or future hikes,” Greenblatt says. “The race for big intellectual property has intensified, as each platform looks to gain a leg up on what it can offer its customers.”
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Among them: Disney $400 million per year seven-year pact to air NHL, some of which will air on ESPN+; Peacock’s deal with Universal to bring its movies to the platform no more than four months after theatrical release; Netflix plan to stream games on the platform within the next year.
“And that’s on top of the increasingly ambitious original programming slate that each service continues to pursue,” Greenblatt says.
Separate hardware platforms like Roku, Apple TV and Chromecast also got sizable boosts for reasons that could run the gamut from retrofitting a non-connected TV to make it “smart,” or accessing services that may not be available on specific brands of smart TV.
“Streaming services continue to add value to justify any past or future hikes. The race for big intellectual property has intensified, as each platform looks to gain a leg up on what it can offer its customers.”
— Ian Greenblatt
Surveying the responses of more than 1200 US adults to subscription-based services, J.D. Power finds 79% of people are spending the same or more time streaming than they did six months ago.
Of shows, that debuted in the May to June period it was season 5 of Lucifer that was the most streamed show helping Netflix+ maintain its industry-leading market share.
And critically panned it may have been, but the Friends Reunion special seems to have done the numbers for HBO. Not only did an estimated 29% of streaming households watch is premiere on HBO Max, but the trip back to Central Perk also helped give the original show a signal boost. Friends was the third-most streamed show in June, which helped boost HBO Max to a 41% subscription rate among respondents, up from 22% in December and trailing only Netflix, Amazon Prime, Hulu, and Disney+, per the survey.
