Contrary to prevailing trends of household subscription slashing, students can’t live without streaming services.
For Gen Z, streaming is a thread in the fabric of their lifestyle – but more are willing to sacrifice ad-free content for budget-friendly pricing. That is, according to the new Streaming Report, based on research by UNiDAYS, a Gen Z affinity network that enables students and graduates to discover savings.
Regular, relevant and personalised TV, film and music content at a reasonable price is the bedrock of students’ loyalty. Nine in 10 of the three thousand plus students across the UK, US, and Australia surveyed earlier this year cited content availability (88%) as one of the most crucial factors when choosing a streaming service. Paling, in comparison, is streaming quality (58%), user experience (41%), and reviews (19%).
Unsurprisingly, price is the ultimate deal-breaker for 93% of students when choosing their streaming service. Spending on average £11.20 per month and favouring more manageable monthly payments over annual subscriptions, Gen Z is realistic in offsetting costs. As 60% lean toward ad-supported streaming versus 40% for ad-free models, brands need to refocus short-term gains for long-term loyalty across the board.
Ad-tiering models
“As the ad pendulum swings, nailing a mix of ad-supported and ad-free models for those with looser purse strings is essential,” said Juandré Bekker, technology category lead at UNiDAYS. Given our findings, pricing pyramids, along with customisable ad experiences that let users decide how and when they view ads, should be top of the agenda.”
In the ultra-competitive streaming sector, providers that crank up the personalisation dial and satiate students’ appetite for tiered subscriptions, short ad run-times and non-disruptive ad placement stand to outperform. Even though it’s still early days, Netflix offers proof-of-concept reporting five million uptakes of its ad-supported option in the first six months.
Exciting budget-friendly content fuels loyalty
“The most positive takeaway for brands is that Gen Z sticks with what they love,” added Bekker. “Once they’ve chosen a platform, four out of five will hang around as long as it provides quality content at a fair price. But getting them to stay depends on much more than bulk offerings.”
Streaming giants Netflix, Amazon Prime, and Apple TV have all seen drops in usage of around 40% because of stale content. Platforms can no longer rely on an extensive back catalogue. This generation demands more–which means fresher content that speaks to them and their experiences.
Personalisation prized by individualistic Gen Z
Thanks to its strident data analysis, AI algorithm, and alternative categories, the unrivalled level of personalisation offered by Netflix means, regardless of drop-offs, its uniquely targeted content suggestions still attract more students than any other viewing platform. In fact, in spite of recent controversies around password sharing, 85% of respondents report using Netflix every month compared to Amazon Prime Video (59%) and Disney+ (56%).
In music streaming usage, Spotify has reigned supreme over the past 12 months. Offering genre-tailored daily mixes and weekly customised playlists to nostalgia-sparking Time Capsules, every element aligns with a user’s individual appetites. It’s no wonder 63% of respondents report being ensnared at least once a month.
Social media, all buzzed up
When discovering new content, students trust recommendations from social media (68% for viewing; 62% for listening) and word-of-mouth (66% for viewing; 55% for listening) more than any other source. Only 21% use traditional review sites for video content, dropping to a staggering 10% for music discoveries.
“We’re experiencing a revolution in entertainment marketing,” said Bekker. “The power and relevance of social proof, peer recommendations, and targeted ads is undeniable. The recent success of the savvy marketing campaign for Greta Gerwig’s Barbie speaks volumes about the role of traditional marketing. As does the backlash against ‘anti-woke’ reviews. It also shows that attracting Gen Z students to new content hinges on streaming platforms creating the right buzz on social media.”
The problem with password sharing
Accessing video streaming through password sharing is a prominent cost-saving trend among students, with 27% reporting using their parent’s account to access Amazon Prime, 25% for Disney+ and 24% for HBO Max. The tack holds across Paramount+ (19%), Hulu (19%), and Apple TV (17%). Netflix stands head and shoulders above all others, with double that of Apple TV.
More than a third (34%) of respondents reported streaming Netflix via a parent’s account, a practice estimated to cost Netflix $6 billion annually. Since the UNiDAYS survey, a recent crackdown has resulted in an addition of 5.9 million users in the first three months– three times the figure expected by analysts. Only time will tell if Gen Z will rally behind the platform or shift loyalties to a more compassionate provider.
One constant is clear: Gen Z is steadfast in its streaming choices. Even if changes to account sharing disgruntle some, the combination of quality content, personalised experiences, social recommendations, and value for money will determine which streaming services see an uptick in subscriptions.
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