Attention recession impacts on D2C growth
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20,000 foot view: Weekly active user (WAU) penetration for the top streaming services is now slowing with quarter-on-quarter growth effectively flat for the leading subscription video on demand (SVOD) services. Peak attention is now clearly here for video. The looming attention recession, which is already impacting the wider digital entertainment landscape, will exacerbate the greater underlying disengagement trends such as cancelling subscriptions that are starting to impact on video. Average weekly hours for SVOD are marginally down from hours in 2021 to hours in 2022. Nonetheless, the increasing moves to add an entry-level ad tier to SVOD services are likely to also increase cancellations from the of consumers who skip ads. WAUs can thus be expected to decline in 2022 as subscribers disengage with both their attention and their wallets.
Key insights
- As the recession plays out, multiple video continue to climb. of consumers have one or more SVOD compared to as of 2021
- Consumers are approaching saturation with WAU penetration the leading SVOD services slowing
- Netflix Amazon Video and Disney+ are all marginally between 2021 and 2022 Apple TV+ remains flat at penetration strategy is evolving to offset cost-of-living impacts with Disney announcing in 2022 that they will be introducing an ad-supported tier to Disney+, and Netflix is rumoured to be considering doing the same
- Ad-supported tiers face significant resistance as of usually skip video ads online 2022, up by from 2021
- YouTube remains most used video platform by subscribers – of those who more than one video subscription, use YouTube on a weekly
- Netflix is the most popular SVOD service SVOD WAUs, with of all subscribers being a Netflix WAU, experiencing two consecutive quarters of decline in 2022
Companies and brands mentioned in this report: Amazon Prime Video, Apple TV+, Disney+, ESPN+, Facebook Video, Formula HBO Max, Hulu, Meta, Netflix, Paramount+, Spotify, Snap, Pluto Tv, Tubi, and YouTube