The streaming retention revolution Content is king, distribution is queen, but retention is revolutionary

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20,000 foot view: With video streaming transitioning into mainstream TV consumption, we have moved into the era of streaming TV. As a result, the early focus on gaining subscribers is making way for the rising challenge of retaining these newly acquired subscribers. Retention is the key metric of the emerging post-growth streaming, with the ratio of weekly active users (WAUs) who are daily active users (DAUs) becoming the key metric to measure streaming success, as streaming TV becomes a fully digitally- native experience. Content proliferation will need to make way for content curation as video becomes deeply entwined with the wider digital entertainment ecosystem.
Key insights
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Video subscriptions in 2022 are now at penetration rates – higher than where pay-TV subscriptions were in 2018 (in English speaking markets)
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However, subscription penetration rates have been around the mainstream mark since the start of the big bang moment of 2019
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Multiple video subscriptions increased year-on-year (YoY) by five percentage points to in 2022, suggesting that growth will start to slow as the market starts to saturate
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Video streaming is starting to lose direct engagement with viewers with both YoY and weekly time spent on streaming video down and actual full attention down two percentage points to
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This means that streaming TV is increasingly becoming part of, rather than distinct from, other digital entertainment formats and behaviours
- services now need to approach retention hooks from a digital first, rather than from a legacy TV, perspective
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At its core, the new retention era will be marked by pragmatism and conservative risk taking in content investment and distribution
Companies and brands mentioned in this report : Amazon, Amazon Prime Video, Audible, Disney, Disney+, Netflix, and Spotify