Deloitte’s 14th Digital Media Trends Survey is out, and this time the focus is on consumer streaming and entertainment habits.
Deloitte conducted two surveys related to digital media: one pre-COVID-19, and a second in May. Together, the surveys provide intriguing insights into how media consumption has accelerated and changed as a result of COVID-19.
“Before and since COVID-19 hit, consumers loaded up on paid media subscriptions and sampled free services,” report authors Kevin Westcott, Jeff Loucks and Kevin Downs write. “As costs, competition, and subscription fatigue grow, their choices today could shape the industry for the next decade.”
As the data came in for the latest survey, Deloitte saw a big trend in media and entertainment (M&E).
“Consumers were adding, sampling, and cancelling services in search of the best value for their time and money,” they note. “They subscribed to an average of 12 media and entertainment services, while also seeking more free and subsidized entertainment, such as ad-supported streaming video. With so many entertainment options, competition to attract and retain customers was fierce.”
Then came the COVID-19 pandemic, leading Deloitte to launch in May 2020 a second survey on media consumption. By this time, nearly 95% of the U.S. population had been under “shelter in place” orders, business activity had been widely restricted, and more than 20 million Americans had lost their jobs.
What Deloitte found is that the COVID-19 story isn’t so much “before and after” as it is “before and faster.”
“Customer acquisition has accelerated, especially in paid streaming video, music, and gaming subscriptions,” Kevin Westcott, Jeff Loucks and Kevin Downs say. “People have more time on their hands to watch, listen, and play games, and they are adding new services to get new content. More are trying new media and entertainment options that have been enabled or accelerated by the crisis. Social viewing, live streaming, and first-run movies that release directly to digital services have all shown strong engagement during shelter-in-place guidelines. In difficult times, many turn to the solace of media and entertainment.”
At the same time, they note, it is harder to keep customers—more are cancelling services.
“Introductory offers of free or reduced rates, along with compelling original content, are attracting subscribers, but they’re likely to cancel a service if the content dries up and they can’t justify the full price,” they note.
The emergence of free, ad-supported alternatives makes it even more critical for subscription services to deliver value, especially since they’re up against growing competition from live streaming video services and video gaming, the Deloitte researchers add.
Among the key takeaways from the report:
- U.S. consumers had an average of 12 paid media and entertainment subscriptions pre-COVID-19.
- Eighty percent of U.S. consumers now subscribe to a paid streaming video service. Subscribers pay for an average of four services, up from three pre-COVID-19.
- In just a few months, since the COVID-19 outbreak, 17% of current subscribers cancelled a paid streaming video service.
- Forty-seven percent of U.S. consumers cited using at least one free ad-supported streaming video service during the pandemic as they search for budget-friendly entertainment.
- Thirty-eight percent of consumers have tried a new digital activity since the pandemic began, such as watching a livestreaming event.
- Fifty percent of Millennials would be willing to attend a sporting event in the next six months, compared with just 28% of Boomers.
- A third of U.S. consumers and nearly half of Gen Z and Millennials say that video games helped them get through a difficult time.
There’s also some interesting intelligence on paid music streaming services. They held up during the COVID-19 pandemic’s height.
What does the future hold?
“The pandemic has created conditions and opportunities for people to try new things as they search for ways to stay entertained during a challenging time,” Deloitte says. “The question for service providers is will these new interests remain as consumers get back to normal, continue to grapple with economic hardship and become increasingly selective about the content they choose.”
To view the report in its entirety please click here.
