In today’s digital age, streaming services have become an integral part of the lives of many, especially among the younger generation. For Gen Z students, streaming is not just a form of entertainment but a lifestyle. However, with limited budgets, many students are turning to ad-supported subscriptions to keep their costs affordable. This trend has been highlighted in a recent Streaming Report conducted by UNiDAYS, a Gen Z affinity network that enables students and graduates to discover savings.
The Importance of Content Availability
According to the report, content availability plays a significant role in students’ choice of streaming service. In fact, 88% of the students surveyed cited it as one of the most crucial factors. This highlights the importance of streaming platforms offering a wide range of regular, relevant, and personalized TV, film, and music content at a reasonable price. Streaming quality, user experience, and reviews, on the other hand, were found to be of less importance to students, with only 58%, 41%, and 19% respectively considering them as key factors in their decision-making process.
The Ultimate Deal-Breaker: Price
Unsurprisingly, price is the ultimate deal-breaker for students when choosing a streaming service. A staggering 93% of students surveyed stated that price is a crucial factor in their decision-making process. Gen Z students are realistic about their budget constraints and are willing to make some compromises to offset costs. On average, they spend £11.20 per month and prefer more manageable monthly payments over annual subscriptions.
The Rise of Ad-Supported Streaming
One interesting finding from the report is that 60% of students prefer ad-supported streaming models compared to 40% who opt for ad-free subscriptions. This indicates that students are willing to sacrifice ad-free content in exchange for more affordable pricing. To capitalize on this trend, streaming brands need to refocus their short-term gains for long-term loyalty. This can be achieved by implementing ad-tiering models and offering customizable ad experiences that allow users to decide how and when they view ads.
Netflix’s Proof-of-Concept: Ad-Supported Option
Netflix, one of the biggest players in the streaming industry, has already recognized the potential of ad-supported subscriptions. In the first six months of offering an ad-supported option, the platform reported five million uptakes, proving that there is a demand for this type of model. This success showcases the viability of ad-tiering models and highlights the importance of offering a mix of ad-supported and ad-free options to cater to a wider range of consumers.
The Power of Budget-Friendly Content
One of the most positive takeaways for brands targeting Gen Z students is their loyalty once they have chosen a platform. Four out of five students stick with a streaming service as long as it provides quality content at a fair price. However, relying solely on an extensive back catalog is no longer sufficient for streaming platforms. Gen Z students demand fresh and exciting content that speaks to their experiences and interests. Platforms that can deliver on this front are more likely to retain and attract students.
The Importance of Personalization
Netflix and Spotify, two leading streaming platforms, have both excelled in their respective markets due to their high level of personalization. Netflix, with its data analysis and AI algorithms, provides uniquely targeted content suggestions that resonate with individual users. Similarly, Spotify offers genre-tailored daily mixes, custom playlists, and nostalgia-sparking Time Capsules. This level of personalization has proven to be highly effective in capturing and retaining the attention of Gen Z students.
The Role of Social Media and Word-of-Mouth
When it comes to discovering new content, students rely heavily on recommendations from social media and word-of-mouth. According to the report, 68% of students trust social media recommendations for viewing content, while 62% trust it for discovering new music. Traditional review sites, on the other hand, are less influential, with only 21% of students using them for video content and a mere 10% for music discoveries. This highlights the power and relevance of social proof and peer recommendations in the streaming industry.
The Challenge of Password Sharing
One prominent cost-saving trend among students is password sharing. A significant number of students reported using their parents’ accounts to access streaming services such as Amazon Prime, Disney+, and HBO Max. Netflix, in particular, has been heavily affected by password sharing, estimated to cost the platform $6 billion annually. However, recent crackdowns on password sharing have resulted in an increase in user subscriptions, indicating that this practice is being addressed by streaming platforms.
See first source: Marketing Tech News
Featured Image Credit: Jonas Leupe; Unsplash – Thank you!