Webcast Recap: OTT Churn & Retention: Increasing Lifetime Subscriber Value

by Parks Associates | Sep. 10, 2018

In a complimentary webcast hosted by Parks Associates and Swrve on September 6, 2018, Hunter Sappington, Research Analyst, Parks Associates, led discussion about OTT churn rates and how companies can work to retain consumers and increase engagement. Joining Sappington was Swrve’s CMO, Barry Nolan and Comcast’s Senior Director of Product Management, David Browne.

After a brief introduction of the panelists, Sappington started of the webcast with research on OTT consumers which included why they are churning, how many services they subscribe to, and how household penetration has stabilized over the past 3 years.

Here are a few highlights from the webcast:

According to Parks Associates research the experimental stage of OTT subscriptions is ending and consumers are beginning to settle in to the services they enjoy, which is leading to slowed churn rates. Churn rates for the big names in OTT like Hulu, Netflix, and Amazon Prime reflect more of a pay TV pattern, whereas smaller niche services like Crunchyroll, Hortus, and the WWE Network’s churn rates vary vastly throughout the year.

Cancellations are holding steady as well, at 18% overall, according to data from Parks Associates. What are the most popular reasons consumers are cancelling their services? Competition and lack of new services are just a couple of triggers causing consumers to leave their OTT service behind. With all of the new and niche OTT services hitting the market, it’s easy for customers to find value in something different than what they’re already using, especially if their current service is slow to add to their library. One of the most popular responses from consumers about why they’ve left a service is that they’ve watched everything, and, according to Sappington, those are the most valuable consumers to retain.

Barry Nolan gave a preview of Swrve’s unique AI software that gives OTT companies a real-time look in to their subscribers viewing habits and allows providers to interact directly with those habits to increase retention and engagement. Nolan discussed his thought on OTT churn rates, specifically where pricing of the services was concerned. Swrve’s data shows that the price of a service isn’t always the cause of consumers dropping their OTT service and Nolan suggested providers give consumers who are leaving their service an opportunity to explain why. This, Nolan believes, will give OTT providers an opportunity to look and increase engagement from their consumers which will retain their subscriptions longer.

David Browne touched briefly on consumer motivations for cancelling and how OTT providers should view the churn cycle as a circle instead of a straight line. Browne believes churn is natural and voluntary, meaning companies can’t truly control who unsubscribes and that at any given time, a company can regain a lost consumer with new content, incentives, or packaged products.

At the end of the webcast, the panelists fielded audience member questions and expanded some more on their thoughts for OTT churn rates and retention.

To listen to the full complimentary webcast, go to http://www.parksassociates.com/ottchurn-sept2018.

For more opportunities to hear about OTT and other digital media trends attend Parks Associates’ inaugural Future of Video event.

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