Research: 20% of US homes subscribe to gaming service
May 15, 2024
Parks Associates reports a continued wave of subscription service uptake among US households, led by streaming video, retail memberships, and streaming audio, while 20 per cent of households have a gaming subscription, outpacing gym memberships.
Parks Associates recently released a consumer study of 8,000 US internet households, Subscription Memberships and Bundling: Shopping, Video, Gaming, Mobile. The study tracks household adoption of membership and subscription programmes and the rise of bundles among various services with different value propositions centred around lifestyle, entertainment, technology and productivity.
The research finds that streaming entertainment services set the pace for the subscription economy. Currently, 89 per cent of households have a streaming video service, and 32 per cent subscribe to a streaming audio service. One in five internet households subscribe to a gaming service, while 16 per cent have a gym membership.
“The evolution of hardware to a service model and demand to drive engagement and loyalty for brands through apps are driving the rise of subscription services,” said Jennifer Kent, Vice President, Research, Parks Associates. “On the streaming audio side, market leader Spotify’s premium adoption is as high as that of Discovery+, the ninth highest video OTT subscription service.”
Beyond video, retail, and transportation, many categories see large jumps in adoption once household annual income passes $100,000, while many subscription categories see adoption drop-offs after age 45. These households can absorb the high prices for gaming and fitness services, and they prioritise convenience over cost (meal kits, kid/baby subscriptions, delivery service memberships), which adds emphasis to the user experience.
Categories that provide entertainment (music, gaming) and convenience (child/baby, meal service) fare particularly well in terms of customer loyalty. Most categories achieved positive NPS (20+), with even high-priced services (gaming, meal kits) receiving high marks. Internet and traditional pay-TV providers, which traditionally have subpar NPS, can benefit from partnering with – or bundling in – services that garner higher customer satisfaction and loyalty.
“Competitive pressure will force market challengers to forge stronger ties, e.g., Walmart Plus and Paramount Plus. Subscription bundlers should seek offerings that span entertainment, productivity, and convenience,” added Kent.