CORD-CUTTING SOARS DURING COVID-19 CRISIS
Navigating The New Normal In Media And Entertainment
Among the many industries that faced upheaval due to the pandemic, the media industry was not alone. Existing trends such as the shift from traditional linear television and cable to cord-cutting have been exacerbated and accelerated as much as the shift from brick-and-mortar retail to online shopping, while the landscape has similarly seen shifts in online and email newsletter consumption patterns, behaviors, and acceptance of digital advertising in exchange for free content.
A new report, Cord-Cutting, Pandemics & Privacy Concerns — What If Media Group, from What If Media Group examines these trends in detail. Based on two surveys conducted in December across nearly 30,000 American adult consumers, the report illuminates the “state of the state” for new media (both video and traditional written content) and provides insights that will be critical to digital marketers in the media sector who are seeking to understand and navigate the new normal for their industry (which has been largely overshadowed by reports focused on shopping patterns – until now).
Cord-Cutting Set to Become Dominant in 2021
Streaming services enjoyed a boom in demand as a number of factors coalesced throughout 2020 to drive usage—and subscriptions—up. While pre-existing generational shifts were already leading to higher adoption of streaming services among younger consumers, 2020 saw almost one-third of US consumers officially achieve “cord cutter” status–with a whopping 41.3% have made the move at some point throughout 2020 alone, according to What If Media Group’s data.
With that in mind, it is clear that having driven consumers indoors and impacted incomes across the country, the pandemic is a major contributor to this trend, with millions signing up for services. In terms of providers, meanwhile, Netflix remains the dominant player, with 41.1% of respondents calling it their “most-watched” service, followed by 21.1% for its nearest competitor, Hulu.
While traditional cable still is the predominant means of accessing television content, What If Media Group data also indicates that over 52% of current cable customers are considering cutting the cord, with 30.8% planning to do so “imminently” or “in the new year” (2021), with just 47.7% of consumers indicating that they intend to stick with their cable service. These numbers represent a faster-than-expected decline for the cable TV industry: as recently as September 2020, a report from eMarketer predicted that the percentage of U.S. households without a cable subscription would not surpass 50% until 2024; instead, 2021 is shaping up to be the watershed year for streaming television providers to take over.
Advertising Outlook for Newsletter and Web Publishers Remains Bright
While paying for online content has been well established with streaming TV, consumers are significantly less likely to pay for written content. A What If Media Group study of more than 9,300 U.S. consumers found that 84.1% of consumers are not willing to pay a subscription to access the type of content that they like to read the most—a situation that has helped to contribute to the heavily ad-supported environment for all but the most premium of today’s content publishers. That said, nearly half of consumers subscribe to at least one email newsletter for news and entertainment, with most subscribing to 2 or more.
Battle for attention.
Further supporting this, a majority of consumers acknowledge that ads in almost every format (TV, print, radio, email, online) are “somewhat influential” or “very influential” on their purchasing decisions. While in the past we have seen survey respondents reluctant to admit the role of advertising in influencing what they decide to buy and how they shop, perhaps improvements in targeting combined with more people spending time indoors and online is shifting perceptions on this front.
Embracing the New Normal for Media Marketers
While What If Media Group’s data suggests that those same consumers are currently at home enjoying quality time with their streaming services, marketers cannot afford to ignore the seismic changes in consumption habits seen over the past year or the rapidly evolving landscape as the post-pandemic world begins to take shape throughout the year ahead.
While some of the changes we have seen of late are likely to continue, including the growth of cord-cutting as a lifestyle, the challenges and opportunities for marketers will come in anticipating the next shifts and being able to meet their audiences wherever they’re headed.
To read the full report from What If Media Group, click here.
The What If Media Group surveys were conducted online within the United States. The first survey focused on cord-cutting was conducted from December 14-15, 2020, among 20,398 adults. The second survey focused on written-word content was conducted from December 20 – 21, 2020, among 9,313 adults. Respondents were randomly selected, and the findings are at a 99% confidence level with a margin of error +/- 2.5%. What If Media Group’s proprietary ad-serving technology includes a real-time survey module that was used to facilitate the data collection for this study. Data was weighted to the 2010 US Census.
About What If Media Group
Founded in 2012, What If Media Group is an award-winning performance marketing company that enables the world’s leading brands to acquire valuable new customers at scale. By leveraging data-driven engagement and re-engagement strategies across multiple proprietary marketing channels and sophisticated targeting technology, and utilizing insights based on millions of consumer ad interactions each day, What If Media Group delivers the most cost-effective and highest performing marketing campaigns for its clients.