Over the past year the entertainment industry has seen many big changes. User behavior was greatly affected by changes in lifestyle, with more telecommuting and the lockdowns that were imposed in many parts of the world. People had more free time to enjoy their favorite series and movies, to try out new platforms and new forms of entertainment at home.
An analysis of the aggregate behavior of our clients’ users in 2020 revealed a significant increase in the consumption of audiovisual content and an even greater rise in the number of users that signed on to OTT services, but also a slightly above-normal user attrition rate, most likely because users were subscribing and unsubscribing to services with greater frequency.
An increase in time spent by users on video platforms was seen primarily for Smart TVs, with linear TV leading this growth with a 287% increase, followed by SVOD (112% increase) and TVOD (9% increase). This data points to a major opportunity for OTT to improve customer loyalty and retention, as this shift in trend is likely to continue once the pandemic has ended.
It does seem that these new consumption habits will remain beyond the pandemic, and video services must therefore adapt to the new scenario by carefully analyzing the behavior of their users, to understand precisely what it is that they want, and be able to personalize their content offering to suit the individual tastes and needs of their consumers.
While television as we know it is going to transform, and it will be interesting to see how traditional radio broadcasting and pay TV evolve, it is clear that streaming services will play a major role and modify the way people consume content.
What can we expect in the next months?
- New players will move onto the scene. With the physical closure to the public of theaters, performance and sports venues, many new streaming platforms emerged for people to watch their favorite events online. And even with the reopening to the public of cinemas, theaters and sports venues, the new digital access to this type of entertainment is a strong complement that will surely continue to grow.
- From the big screen to the little screen: cinema closures forced many content producers to premiere movies directly on television or streaming services, accelerating a phenomenon that companies such as Disney +, HBO Max got ahead of by announcing major premieres on their platforms. Going forward, cinemas will need to reinvent themselves to lead this phenomenon, offering a true entertainment experience and not just a selection of movies, to attract audience by combining their digital and physical environments in response to the new forms of consumption the public wants.
- The importance of content aggregators (especially from TV operators) will continue to rise. In 2020 and these first months of 2021, we’ve seen a significant increase in subscriptions to streaming services. The ample variety of services and of types of content makes it necessary for users to register with different platforms, but the effect of constantly switching from one to another in search of content does not benefit their experience; some may even get tired of it and give up. This is why content aggregators are trying to capitalize all of the content their users want on a single platform, saving them time and money, improving their experience and giving them access to a much broader content catalog on a single interface.
It seems to me that the pandemic has accentuated a trend that had been on the horizon for many years, but more importantly, it has accelerated innovation –for example, the arrival in the region of new business models, such AVOD with Pluto TV– in the video streaming industry, that makes it possible to adapt to the needs of their users.
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