Kantar – the data, insights and consulting company – reports that the overall household penetration rate of the UK’s streaming market declined for only the second time ever in Q1 2022, and attributes the market shrinking to high inflation and the cost-of-living-crisis in the country. 1.51 million SVOD subscriptions were cancelled by UK households in Q1 2022, a rise from 1.04 million in the previous quarter and 1.2 million from Q1 2021.
According to Kantar, one-third (more than half a million) of cancellations were motivated by “money saving” as the main factor – this represents a jump from 28% in the previous quarter. 38% of planned cancellation for Q2 2022 are also being driven by “wanting to save money”.
Among GenZ viewers, the streaming service penetration rate fell for the first time ever from 75.8% in Q1 2021 to 74.6% in the first quarter of this year. Additionally, only 3% of households in Great Britain subscribed to a new streaming service in the first quarter of this year, falling from 4.2% a year ago.
Overall, 16.9 million UK households (58%) are subscribed to at least one SVOD service, down -21.5k quarter-one-quarter. The company says these figures “indicate inflation is top of consumers’ minds” and some households have chosen to “deprioritise entertainment”.
Kantar also reported that – in times of financial uncertainty – SVOD services Netflix and Amazon Prime Video were seen as the most indispensable in the UK, ranking as the last services subscribers would cancel when prioritising their spending. In contrast, Disney+, NOW, Discovery+ and Britbox all experienced significant rises in churn rates, quarter-on-quarter.
Kantar said: “With many streaming services having witnessed significant revenue growth during the height of Covid, this moment will be sobering. The evidence from these findings suggests that British households are now proactively looking for ways to save, and the SVoD market is already seeing the effects of this.
As a result, it’s now more critical than ever that SVoD providers demonstrate to consumers how their services are indispensable in the home in what has become a heavily competitive market. New marketing and content acquisition strategies will likely need to be deployed to support this and avoid further churn.”