Do you subscribe to cable TV, high-speed Internet, telephone, and streaming services? If you do, you're just one of many consumers for whom subscription services -- for everything from groceries to music -- have become a regular part of your lifestyle. In March, incentives and engagement company Blackhawk Engagement Solutions
conducted a study to examine which of these services were the most popular, as well as to find out what motivated consumers to choose one brand over another.
"In the age of sophisticated and engrained deal-finding behaviors, shoppers have identified intelligent ways to not only save on subscription services, but leverage new kinds of subscription services to reduce the cost of older product and service options," said Rodney Mason, GVP of Marketing with Lewisville, TX-based Blackhawk Engagement Solutions. "Our research revealed the top incentives for motivating consumers to try or move to certain subscription services."
The survey, conducted in March, questioned 1,757 U.S.-based consumers that Blackhawk Engagement Solutions determined to be representative of the country's demographics. Key findings include the following:Internet is the most popular subscription service, followed by cell phone plans.
Eighty-nine percent of Americans subscribe to Internet service, followed by 83 percent who subscribe to mobile phone plans. While 74 percent of respondents have a cable subscription, basic cable (36 percent) is about to eclipse premium cable (38 percent), something that could be attributed to the growing popularity of streaming and on-demand services. More than half of consumers (52 percent) subscribe to streaming TV or movie content. Recurring grocery/consumer goods delivery subscriptions are just beginning to take off, but are already in the double digits, with 16 percent of respondents using these services.Prepaid cards and paid termination fees are top motivators for Internet subscribing.
When looking for a new Internet service provider, most shoppers (59 percent) will select a provider that offers a prepaid card incentive versus monthly discounts or other incentives like a free tablet. For consumers interested in switching Internet service providers before their contracts have expired, a top motivator to do so is when the new provider pays the termination fee charged by the old provider (64 percent).Consumers who are researching subscriptions to a "triple-play" bundle (phone, TV, and Internet) can be motivated by rebates.
People shopping for a triple-play subscription take an average of three to six days to make their decision and often compare one to two competitors. Their path to purchase most frequently involves searching providers' websites, then turning to Google, then going in-store or calling, and finally checking with Amazon before buying. Shoppers in the survey, however, report that this routine can be disrupted by a dynamically placed rebate adding more value than the best in-market instant discounts.Online and digital movie delivery is very popular.
More than half of consumers (57 percent) prefer online/digital delivery of movies versus 29 percent who rent movies from a store or kiosk and 15 percent who rent or buy online through a retailer. In consideration of a $14.99 per month video streaming service, consumers overwhelmingly report that a free month of service would be the best motivator for a trial. Younger consumers, and those with higher incomes are also more likely to use online/digital video content.There is a big opportunity for cable to promote on-demand value packages for basic cable subscribers.
Basic cable subscribers are growing and paying monthly fees for streaming while also consuming on-demand product, compared to paying for a premium cable package. This is an opportunity for cable providers to bundle paid on-demand offerings, versus selling them individually, in order to take back market share from streaming services.Pandora is the top streaming music service, and prepaid cards are the preferred incentive for subscription.
Half of consumers report using Pandora for streaming music services, followed by iTunes (35 percent), Spotify (18 percent), SiriusXM (16 percent) and others. A prepaid card is also the most favored incentive for signing up for services in this category, with 60 percent of consumers selecting a $10 prepaid card reward as the best motivator for purchase.Grocery and consumer goods delivery a growing subscription category.
Sixteen percent of consumers surveyed report using these subscriptions. The top incentive for trying grocery delivery services is free shipping (82 percent of shoppers prefer this option), which can be earned through a post-purchase validated reward.
The complete "Super Subscribers," shopper study can be downloaded in its entirety here