LOS ANGELES--(BUSINESS WIRE)--The No. 1 reason why Americans are likely to cancel an online subscription for movies, music, news media, or other apps this year, is that they are too costly, according to the 2022 Digital Consumer Sentiment Survey.
The survey, which was conducted on behalf of Concepts Rise by Directions Research, found that of those very likely or somewhat likely to cancel an online subscription this year, 43 percent of respondents say they are doing so because it is too costly, compared with 20 percent who want to consolidate services, 18 percent who cite promotional pricing or a discount came to an end, and 13 percent who point to lack of quality media.
“Digital subscriptions services face tough competition and need to pair engaging content with exceptional value to keep customers coming back for more,” said Majid Abai, Founder and CEO of Concepts Rise, a Los Angeles-based consultancy that helps companies generate revenue growth and retain customers. “A hit movie or hot music single will bring customers to your storefront, but the ultimate goal is to reduce churn and make the value proposition of your platform irresistible.”
The survey results, which reflect sentiment among U.S. adults aged 18 years and older, arrive on the heels of Netflix reporting a slowdown in subscriber growth in the fourth quarter and Spotify signaling that its new subscriber numbers will face headwinds in the first quarter of the year. New releases and a bounty of options are quick to shift consumer sentiment, and “as many of these platforms mature and new subscription growth slows down, companies will need to focus on retaining their customers for a longer period of time,” Abai said.
By the Numbers
When all survey participants were asked what would motivate them to subscribe to an online subscription service, a majority (58 percent) say better pricing, followed by a broader range of product offerings (22 percent).
Conversely, poor product performance and poor customer service received the least number of votes (5 percent and 2 percent, respectively) when it came to the reasons why people are canceling online subscription services.
“The unfortunate news is that many popular online subscription services have not worked out the bugs over the years and are not providing a consistent user experience across platforms,” Abai said. “This is where the rubber meets the road and companies have to think creatively about improving and optimizing user experience, as well as continuously providing fresh content to their existing subscriber base.”
As more companies focus on retaining subscribers in the year ahead, Abai recommends taking a “customer success” approach to help ensure longevity. That means understanding and anticipating the pains and needs of customers after they subscribe.
“It is also imperative for companies to reward, incentivize and redirect subscribers to new revenue streams,” Abai said. “Continuing to innovate and build loyalty are key to ensuring customers’ longevity.”
Digital Consumer Sentiment Survey Methodology
The Digital Consumer Sentiment Survey was conducted February 15-16, 2022 among a nationally representative sample of 1,054 U.S. adults 18+, providing a margin of error of +/- 3.0 percent. The survey was commissioned by Concepts Rise and fielded by Direction Research’s Xcelerant Rapid Online Omnibus.
About Concepts Rise
Concepts Rise is a leading-edge innovation consulting and advisory firm based in Los Angeles dedicated to ground-breaking and disruptive businesses worldwide. The company offers a full suite of strategic capabilities focused on driving revenue and retaining customers. For more information, please visit www.conceptsrise.com.
