Deloitte Study Charts Pandemic’s Effects on Media Consumption

The 15th edition of Deloitte’s Digital Media Trends survey explores media consumption trends amid Covid-19, charting intensified streaming competition, price sensitivity and the prospect of higher churn rates.

According to the study, 82 percent of U.S. consumers subscribe to at least one paid streaming video service, with the average subscriber paying for four platforms. AVOD is also picking up steam, as Deloitte found that 55 percent of respondents now watch an ad-supported platform. Exploring AVOD trends, Deloitte found that 40 percent of U.S. consumers would prefer to pay $12 a month for a streaming video service with no ads, versus the 60 percent who would accept some ads for a reduction in monthly subscription costs.

The study also points to new trends among Generation Z, which is far more interested in playing video games (26 percent ranked it as their number one entertainment activity) than watching TV or movies at home (just 10 percent listed it as their favorite entertainment pastime). In contrast, for respondents overall, 57 percent ranked watching TV and movies at home among their top three activities (out of 16 entertainment options).

The churn rate for streaming video services is about 36 percent, Deloitte reports. The respondents listed content (35 percent) and price (46 percent) as the most important factors for signing up for a new service.

The study also finds that 52 percent of consumers are struggling to access content across so many services, and 49 percent were frustrated when a service didn’t provide adequate recommendations. Plus, 53 percent are frustrated that so many services are required to access the content they want, and 66 percent get frustrated when the content they want to watch is removed from a service.

“Not only are American consumers more reliant than ever on digital media and entertainment, information gathering and social connection, there is also more competition for audiences among a crowded field of entertainment options,” said Kevin Westcott, vice chairman of Deloitte and its U.S. technology, media and telecom leader. “This requires consumers to ‘dance’ between services, introducing frustrations as they try to manage multiple subscriptions and keep track of their favorite content. Media and entertainment companies with a deeper understanding of customer concerns about content, cost and ad-tolerance across all entertainment options and generations, can cultivate long-term relationships and reduce churn.”