Advanced Television

Research: 40% US homes ‘pay-TV polygamists’

April 5, 2018

US audiences may be moving away from traditional cable, satellite and IPTV packages but the trend is being tempered by the emergence of ‘pay-TV polygamists’ – households taking more than one subscription as they add OTT services – according to research contained in a report, Show the Love with Customer Experience, from subscription, billing and customer relationship management (CRM) specialist Paywizard.

The survey of 1,000 consumers across the US reveals 21 per cent of households now only subscribe to OTT services such as Netflix, Amazon Prime or Hulu as their sole pay-TV package – indicating cord-cutting and new younger users are starting out with OTT subscriptions. What is more striking, however, is that twice as many – 41 per cent – now take both OTT and traditional pay-TV services.

“Cord cutting continues to be a major concern for the US cable and satellite TV industry and our latest research shows that it is definitely having an impact on these services,” advises Bhavesh Vaghela, Paywizard’s Chief Executive. “But the survey also reveals that those subscribers we’ve dubbed ‘pay-TV polygamists’ are emerging as a major force that runs counter to the OTT-only trend.”

The research also reveals that 31 per cent of US households boosted their overall TV and entertainment spend when they added a pay-OTT subscription in the previous 12 months, while just 17 per cent decreased spend as a result of adding a new online TV service.  According to the findings, 43 per cent of US households plan to add a new pay-TV subscription – whether cable, satellite, IPTV or OTT – in the next six months.

“The US is the most advanced TV market in the world with high pay-TV adoption and the research signals that there is a real opportunity for operators to prevent cord-cutting and win over new subscribers, as the figures also show consumers are willing to spend more overall on pay-TV if the customer relationships are managed effectively, adds Vaghela.

The study also reveals:

  • 92 per cent of US households have some form of pay-TV subscription
  • 71 per cent have a traditional cable, satellite or IPTV subscription
  • 62 per cent subscribe to an OTT service
  • 25 per cent of respondents have cancelled a pay-OTT service in the previous 12 months due to poor customer experience

The research demonstrates that failing to provide a consistently positive customer experience has real and serious ramifications: 30 per cent of US households with a pay-TV service experienced a negative interaction or issue with at least one of their TV service providers within the previous 12 months – with 42 per cent of those people cancelling their service.

Just 24 per cent of US respondents feel matters were handled effectively and were happy with the outcome when they had a negative interaction or issue. The remaining 76 per cent feel the interaction damaged their view of the brand – whether an OTT or traditional operator.

“The survey makes it absolutely clear that failing to proactively deliver a consistently positive customer experience will cost US TV operators brand reputation and subscribers,” Vaghela notes. “It also establishes that, as the base of multi-subscription customers grows, operators need to differentiate themselves to win and retain them. The key is improved interactions guided by data-led insight at every stage of the customer journey – so that marketing is more precisely targeted, processes streamlined, recommendations better informed and each engagement more personalised.”

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