As the growth of streaming slows in the UK, providers face an increasingly saturated market
Ahead of Netflix’s announcement of its second quarter financial results later this month, Simon-Kucher’s latest study shows that streamers are doubling down on price being the most important factor when making a subscription decision
- Simon-Kucher surveyed more than 12,000 streaming consumers from across 12 countries around the world on their streaming behaviors and preferences, of which over 1,000 were based in the UK
- Only 38 percent of respondents in the UK indicate they stream more compared to last year, a decline of 10 percentage points compared to the 2022 study
- The average number of owned subscriptions per UK respondent decreased 10 percent compared to last year, to an average of two per respondent
- The gap between free online services and paid subscription services is closing, with free online services accounting for 35 percent of total streaming time in the UK (an increase of 10 percentage points compared to last year) and paid subscription services making up 46 percent
London, 13th July 2023 -- The latest research from global consultancy Simon-Kucher into consumer streaming behavior and preferences reveals that the growth of streaming is slowing down. In their second annual Global Streaming Study, Simon-Kucher reveals that only 38 percent of UK respondents indicate they stream more compared to last year -- this is down 10 percentage points from the number of consumers who indicated their streaming habits were up year-over-year in 2022. The study also revealed the average number of owned subscriptions per respondent in the UK is 2; down 10 percent from last year.
“As the number of streaming subscriptions available to UK consumers continues to increase, the budgets of those consumers isn’t getting any larger and they’re actually becoming more price sensitive. Add to this the fact that a significant portion of subscribers are already overwhelmed with the amount of content they currently have access to, and providers will need to work hard to distinguish themselves in a saturated market” said Greg Harwood, Partner at Simon-Kucher.
The majority continue to use streaming services to watch films and series rather than live events
Compared to last year, streaming of both films and series has declined slightly in the UK – 71 percent of consumers spend more than two hours per week watching movies (a decline of 7 percentage points), while 76 percent spend more than two hours per week watching TV series (a decline of 2 percentage points). Live events (e.g. sports) are significantly lower at only 37 percent of respondents spending more than two hours per week watching these (flat versus last year).
Purchase drivers are holding steady, as are overall budgets
Year-over-year, purchase criteria for UK consumers are largely unchanged. Price is the most important purchase criterion, followed by breadth of content available. The importance of frequency of new content is down four percentage points, potentially due to the amount of new players and content on the market. 46% of UK respondents can be classified as being in the ‘price sensitive’ segment, a slight increase from last year and larger than other segments (41% being in the ‘price-value oriented’ segment and 13% in the ‘value oriented’ segment).
Overall monthly budgets that UK respondents were willing to spend on streaming subscriptions in the stayed flat compared to last year.
Subscription fatigue is on the rise and cost savings are a key reason to drop subscriptions
UK consumers stated that they find themselves increasingly overwhelmed with the content they have access to in their streaming subscriptions (33 percent, an increase of 3 percentage points vs. 2022). In addition, they are finding it increasingly hard to manage the number of streaming subscriptions they have (17 percent, an increase of 2 percentage points).
22 percent of UK consumers cancelled an existing subscription within the last 12 months, a similar portion to last year (a decrease of 1 percentage point). When combined with the fact that the average number of subscriptions paid for by these consumers has gone down by 10 percent this indicates that consumers are signing up to fewer new subscriptions than they were this time last year.
For those UK consumers who did churn, the key reason cited was saving money – 52 percent indicated this was the reason for their decision, a 4 percentage point increase on 2022.
Complete study findings are available upon request, including country splits.
*About the Study: The Global Streaming Study 2023 was conducted during May 2023 by the global consultancy Simon-Kucher & Partners. More than 12,000 consumers from across 12 countries (Australia, Brazil, China, France, Germany, India, Netherlands, Singapore, Spain, Sweden, UK, US) were surveyed on their streaming behaviors and preferences.
Rachel Pope
rachel.pope@simon-kucher.com
About Simon-Kucher
Simon-Kucher is a global consultancy with more than 2,000 employees in 30 countries. Our sole focus is on unlocking better growth that drives measurable revenue and profit for our clients. We achieve this by optimizing every lever of their commercial strategy – product, price, innovation, marketing, and sales – based on deep insights into what customers want and value. With 37 years of experience in monetization topics of all kinds, we are regarded as the world’s leading pricing and growth specialist.
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