With earnings season officially underway, Eunice Singh is eyeing streaming service owners’ ability to retain subscribers.
“In a world where economic uncertainty still exists, content quality remains hit-based, and there are many bombshells, how do you feel about churn? How do you retain your hard-earned customers in an increasingly competitive and price-competitive world?” Partner of strategic consulting firm Prophet and companies such as Disney, Warner Bros. and NBCUniversal. Singh, who has been consulting for , said in the latest episode of the Digiday podcast.
This is a big issue, and all the more urgent given the streaming market’s shift in focus from subscriber growth to profitability. After the pandemic caused streaming subscribers to skyrocket, that growth began to slow in his 2021, and even slower in 2022, to the point that Netflix actually cut subscribers. Then, with an economic downturn and the threat of a potential recession looming, investors turned their attention to how much money companies were spending—and often losing—on their streaming businesses, and streamer subscribers questioned whether the numbers justify their program costs.
That’s why Shin pays close attention to subscriber churn rates for streamers.
“When you think about when all these streamers launched, most of it happened during the pandemic. People have spent a lot of money to get these customers. But how are you doing to attract people to those platforms with investment in content and keep them…. As far as subscriber growth is concerned, if the number of churn is high, one step forward It’s like taking a step back and taking two steps back,” she said.
Below are some highlights from the conversation. Edited for length and clarity.
fighting the churn
This is Netflix’s strategy for giving volume. Having seen “Emily in Paris”, it is very important to know what to do next and what is offered. ? “
ideal churn rate
Everyone has always tried to get under 5%. That’s the ideal situation.
The rebundling era of streaming
We are rapidly moving into a world of consolidation again. I think everything we’ve seen in the world of cable so far finds itself in the world of streaming aggregation. can i get more?
What’s the alternative to free, ad-supported streaming TV? Not so soon
I’m not sure if this is throwing a dagger that is too strong, [free, ad-supported streaming TV] Services resonate only with a certain number of generations in our population. If you look at Gen Z behavior, no one is turning on Pluto. [TV] To watch old reruns of “Gilligan’s Island,” etc. That type of content doesn’t resonate.