Streaming services have a lot to teach us about standing out in a crowded market.
During COVID-19 quarantining, our worlds have gotten significantly smaller. Without trips to the movies, live sports, travel or, let’s face it, anything really, many are turning to TV to fill the time with entertainment, or pure distraction.
With cable subscription rates dropping precipitously over the years—current estimates have subscriptions down nearly seven million households in the last two years alone—the options for viewership have shifted to streaming. And, with new streaming services like Quibi, NBC’s Peacock and HBO Max entering the market what seems like weekly, more and more players are battling for smaller slices of the same pie.
Stay-at-home orders have led to a boom in streaming service successes in recent months. Netflix, the most established name in the streaming game, has seen some of the most substantial gains since the pandemic began. While late in 2019 the company saw a 15% drop in stock prices, they’ve bounced back exponentially in the first part of 2020. Netflix has experienced massive growth, with 15.8 million new subscribers added last quarter and a six-month stock jump of an astronomical 49%.
Upon the merger of Viacom and CBS in 2019, the company took a massive hit, with its stock price dropping 15%. The pandemic further decimated the company’s prospects, with share prices dipping an additional 32% in recent months. The only bright spot in ViacomCBS’s holdings were their streaming platforms, CBS All Access and Showtime OTT, which are positioned to gain an additional 16 million subscribers by year’s end. The company even plans to expand their streaming offerings into one “Super Service,” a universal platform with thousands of hours of additional content, set to launch in 2021.
These success stories beg the question, however: is this growth sustainable?
When the Dust Settles
It’s been reiterated ad nauseum, but if there’s any certainty of the COVID-19 era it’s a total lack of certainty. While this thriving streaming landscape has to be encouraging for company stakeholders, the entire enterprise may be hit with even greater challenges down the road if services fail to adapt.
As I told the Observer in April: Netflix can't take for granted that the viewer will remain loyal if content isn’t consistently refreshed. At the same time, once sports and other live-programming return to the viewer’s choice, Netflix could be pushed to the side due to its library of also-ran content choices.
ViacomCBS is in an even more precarious position with their content strategy, as it focuses heavily on stockpiles of older series with less emphasis placed on new content.
Echoing what I told the Observer in June: the winner in the streaming battle has to do much more than assemble thousands of hours of content. Whoever wins will have the highest concentration of content that truly engages with the audience. Quality is the key.
The uncertainty of the COVID-19 era also makes the reality of the current streaming boom much more tenuous. With no real competition from live programming, streaming services positioning for the future may miss their window to hooking long-term subscribers while the demand is there. ViacomCBS’s plans for a 2021 launch could spell disaster if the landscape is crowded with competition from not only other services, but live sports and more in-person entertainment options.
Today’s consumers have a short attention span and they are growing less and less patient for delays. CBS needs to play big in Q4 against this programming or else they will be perceived as irrelevant in the ad buyer and viewer mindset. There’s no time to waste is All Access wants to take a jump in the key markets and audience segments.
What Should Streaming Services Be Doing to Win the War?
The truth is, the streaming wars could be completely upended as elements of normalcy return to daily life. As live television comes back, sports, and more in-person entertainment options become available again, people that have spent the last few months scrolling through streaming options may be looking for an escape, which could result in slowed new subscriptions and cancelled old subscriptions.
The key is providing new, engaging content that viewers can’t find anywhere else. In order for a streaming service to become a major player, they need not only their own Tiger King, but follow-up cultural touchstones that keep audiences coming back to their service regardless of what else is out there.
This maxim isn’t solely limited to streaming services either. In the battle for eyes and engagement, the content coming from publications, marketers, and social teams are all in competition. The ones that “win the war” will work to keep audiences consistently engaged, and returning to see what’s new and exciting regardless of what state the world’s in.
With production halts in the entertainment industry causing an ever-drying well of content, at some point every streaming service, no matter how established they are, will need to reckon with the fact that their offering can’t fulfill the market’s demand for the new and exciting. And, as more competition begins to battle for viewer attention, it’s imperative that streaming services strike while the iron is hot, bringing in as many new subscribers they can while the demand is still there.
Posted by Al DiGuido