2022
9
UK Digital Subscriptions Market Report 2022
2022-08-24T04:04:48+01:00
OX1101847
2195
155054
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Report
en_GB
“Many digital subscribers see their subscriptions as a key part of their life and will be prioritising them over other leisure expenses during the next year. Brands can encourage retention…

UK Digital Subscriptions Market Report 2022

£ 2,195 (Excl.Tax)

Description

The UK Digital Subscriptions Market Report examines consumers’ behaviours in relation to digital subscriptions, the type of digital subscriptions that consumers have and the impact of the cost of living crisis on the digital subscription market. This report covers the digital subscription market size, market forecast, market segmentation and trends in the subscription eCommerce market.

 

Current Landscape of the Subscription eCommerce Market

The digital subscriptions market has dipped in 2022, with the cost of living crisis causing some people to cancel their subscriptions. Inflation has put all subscriptions at risk of losing customers, regardless of the income of the users. This financial squeeze will inevitably result in fiercer competition between digital subscription market services, as people are financially forced to decide which services they prioritise.

 

Digital Subscription Market Share and Key Industry Trends

While more restricted consumer budgets will mean the subscription eCommerce market remains more challenging going into 2023, many consumers will prioritise their digital subscriptions over other leisure expenses.

Meanwhile, Netflix is experimenting with charging a fee for sharing account details for their video service outside of the home in several South American countries to try and combat subscribers sharing their login details with their friends or family, which is significantly hindering Netflix’s growth. If this strategy goes worldwide, it will make it harder for people to access multiple streaming services.

  • Subscription eCommerce market share: Disney+ is a leading brand in the digital subscription market and recorded 41.4 million subscribers in January 2022, marking a 40% YoY increase.
  • 52% of UK adults have a video streaming service subscription, and 82% are Netflix subscriptions.
  • 35% of people with a household income of £50,000 or over have cancelled a digital subscription in the last year due to rising costs.
  • 44% of Brits share their login details for a digital subscription with a friend or family member.

 

Future Digital Subscription Market Trends

With consumers becoming more budget-conscious, service providers in the digital subscription market are likely to introduce more tier options, to attract a broader range of subscribers, including cheaper ad-supported tiers in the app.

In addition, more service providers in the digital subscription market are likely to broaden the content they have on offer, such as Netflix investing in gaming content. This opens up opportunities to offer subscription tiers based on varying levels of content or features.

To discover more about the UK Digital Subscriptions Market Report 2022, read our UK Attitudes Towards Video & TV Market Report 2022, or take a look at our Technology Market Research Reports.

 

Quickly Understand

  • Explores consumers’ digital subscriptions, including video streaming, music streaming, game streaming, newspapers and magazines, e-books and more.
  • Outlines which video streaming and audio streaming services consumers are subscribed to.
  • Examines which digital subscriptions consumers have cancelled in the last year.
  • The factors in the decision to keep one video streaming service over another.
  • Attitudes towards free trials in digital subscriptions, monthly compared to yearly payments, sharing login details and more.
  • Explores the digital subscription market share and size.

 

Covered in this Report

Brands: Netflix, Amazon Prime, Spotify, Apple Music, Google Stadia, Xbox Game Pass, Dropbox, Google One, iNews, TIME, Apple Fitness+, FiiT, Scribd, Audible, Vogue, Tidal, YouTube Music Premium, Deezer Premium.

Products: Digital subscriptions cover video, audio, game streaming, cloud storage, news, magazine and fitness.

Expert Analysis from a Specialist in the Technology Sector

This report, written by Zach Emmanuel, a leading analyst in the technology sector, delivers in-depth commentary and analysis to highlight current trends in the UK digital subscription market and add expert context to the numbers.

Many digital subscribers see their subscriptions as a key part of their life and will be prioritising them over other leisure expenses during the next year. Brands can encourage retention by marketing discounted yearly subscriptions as ‘short-term pain, long-term gain’, enabling people to save money in the long run, while avoiding continual monthly expenses within this uncertain, inflationary period.”

Zach Emmanuel - Research Analyst

Zach Emmanuel
Consumer Technology Analyst

Table of Contents

  1. Overview

      • Key issues covered in this Report
        • Market context
          • Products covered in this Report
          • Executive Summary

              • The five-year outlook for digital subscriptions
                • Figure 1: Category outlook for digital subscriptions, 2022-27
              • The market
                • Barclaycard data shows YoY decrease in spending on digital content and subscriptions
                  • Companies and brands
                    • Netflix and Disney+ to launch ad-based subscription options
                      • Spotify puts HiFi on backburner while developing podcast and audiobook focus
                        • Google Stadia continues to take a backseat approach to game streaming
                          • Apple Fitness+ adds meditation and Pilates sessions
                            • The consumer
                              • Video and music streaming provides escapism for consumers struggling financially
                                • Figure 2: Type of digital subscription, 2022
                              • Sports-based content would bring more men to Netflix
                                • Figure 3: Video streaming service subscribed to, 2022
                              • Spotify falling behind on quality audio
                                • Figure 4: Music streaming service subscribed to, 2022
                              • Inflation causes even the higher earners to consider cancelling their subscription
                                • Figure 5: Digital subscription cancelled in the last year, 2022
                              • Women are particularly likely to downgrade to new ad-supported subscription options
                                • Figure 6: Factors when choosing which video streaming service to cancel, 2022
                              • Streaming services must tread carefully with differentiating tiers
                                • Figure 7: Attitudes towards prioritising and cancellations of digital subscriptions, 2022
                              • Longer trial length based on tier could encourage consumers to get more expensive plans
                                • Figure 8: Attitudes towards adverts, value and free trial periods of digital subscriptions, 2022
                              • A marketing theme of ‘short-term pain, long-term gain’ could convince people to buy a yearly subscription
                                • Figure 9: Attitudes towards cost of living crisis and discounted yearly rates for subscriptions, 2022
                            • Issues and Insights

                              • Discounted yearly offers could appeal in times of high inflation
                                • Services to introduce new tiers to provide more options for budget conscious consumers
                                • Market Drivers

                                  • The five-year outlook for digital subscriptions
                                    • Figure 10: Category outlook for digital subscriptions, 2022-27
                                  • Inflation is the key concern in 2022 for consumers, brands and the economy
                                    • Consumer spending power will be curbed
                                      • Barclaycard data shows YoY decrease in spending on digital content and subscriptions
                                        • Parents have spent more on digital entertainment for their children since COVID-19
                                        • Competitive Strategies

                                          • Netflix to possibly charge subscribers to share password outside of home members
                                            • South American subscribers and Netflix staff left ‘confused’ over password charge
                                              • Netflix is either unable to differentiate households or is not enforcing the charges
                                                • Netflix mobile gaming is expected to be just the start
                                                  • Focusing on audio first
                                                    • Spotify puts HiFi on backburner while developing podcast and audiobook focus
                                                      • Developing its podcast and audiobook offering
                                                        • Google Stadia continues to take a backseat approach to game streaming
                                                        • Launch Activity and Innovation

                                                          • Netflix and Disney+ to launch an ad-based subscription options
                                                            • Netflix
                                                              • Disney+
                                                                • Netflix’s ad-tier points towards greater differentiation between plans
                                                                  • Many subscribers willing to compromise with ads
                                                                    • PlayStation brings game streaming to PlayStation Plus to compete with Xbox Game Pass
                                                                      • Cloud gaming is growing significantly
                                                                        • Apple Fitness+ adds meditation and Pilates sessions
                                                                          • YouTube Premium trials smart download feature
                                                                          • Subscriptions to Digital Services

                                                                            • Video and music streaming provides escapism for consumers struggling financially
                                                                              • Figure 11: Type of digital subscription, 2022
                                                                              • Figure 12: Type of digital subscription, by financial situation, 2022
                                                                            • Bundles will appeal to those struggling financially
                                                                              • Figure 13: Repertoire for subscriptions to types of digital services, 2022
                                                                              • Figure 14: Repertoire for subscriptions to digital services, by financial situation, 2022
                                                                          • Type of Video Streaming Service

                                                                            • Sports-based content would bring more men to Netflix
                                                                              • Figure 15: Video streaming service subscribed to, 2022
                                                                              • Figure 16: Video streaming service subscribed to, by gender, 2022
                                                                            • Mobile network providers selling iPhones should focus incentives on Netflix
                                                                              • Disney+’s addition of Marvel series will help to expand audience
                                                                                • Figure 17: Video streaming service subscribed to, by dual parent families, 2022
                                                                              • Entry level plans can target consumers who are currently settling on two video streaming subscriptions
                                                                                • Figure 18: Repertoire for subscriptions to video streaming services, 2022
                                                                                • Figure 19: Repertoire for subscriptions to video streaming services, crossed by cancellations of video streaming services, 2022
                                                                              • Highlighting Apple TV+ outside of Apple devices could be a point of expansion
                                                                              • Type of Music Streaming Service

                                                                                • Spotify falling behind on quality audio
                                                                                  • Figure 20: Music streaming service subscribed to, 2022
                                                                                  • Figure 21: Music streaming service subscribed to, for Older Millennials, 2022
                                                                                • Subscriptions to multiple music streaming services could also point to the movement away from Spotify
                                                                                  • Figure 22: Repertoire for subscriptions to music streaming services, 2022
                                                                                  • Figure 23: Repertoire for subscriptions to music streaming services, crossed by type of music streaming platform subscribed to, 2022
                                                                                • Smart downloads feature for Spotify Premium would appeal to mobile users
                                                                                  • Figure 24: Subscriptions to Spotify Premium, by working situation, 2022
                                                                                • Podcasts can be a strong promotional option for video streaming services
                                                                                  • Spotify hub promotes major video streaming services
                                                                                    • Figure 25: Subscriptions to streaming services, crossed by subscriptions to video streaming services, 2022
                                                                                • Cancellations of Digital Subscriptions

                                                                                  • Inflation causes even the highest earners to consider cancelling their subscriptions
                                                                                    • Newspapers and magazines should use perks to retain subscribers
                                                                                      • Apple One could appeal to high earners considering cancelling services
                                                                                        • Other major franchises could offer bundles in the future
                                                                                          • Figure 26: Digital subscription cancelled in the last year, 2022
                                                                                          • Figure 27: Digital subscription cancelled in the last year, for people with a household income of £50,000 or over, 2022
                                                                                          • Figure 28: Attitudes towards cancellations of digital subscriptions, 2022
                                                                                      • Biggest Motivations to Keep a Video Streaming Service

                                                                                        • Women are particularly likely to downgrade to new ad-supported subscription options
                                                                                          • Figure 29: Factors when choosing which video streaming service to cancel, 2022
                                                                                          • Figure 30: Factors when choosing which video streaming service to cancel, by gender, 2022
                                                                                        • Netflix’s original series to help its loss of well-known titles
                                                                                          • Consumers are not particularly concerned with alternative content on video streaming services
                                                                                          • Attitudes towards Digital Subscriptions

                                                                                            • Streaming companies should follow Netflix and Disney+’s approach on ad-based tiers
                                                                                              • Streaming services must tread carefully with differentiating tiers
                                                                                                • Figure 31: Attitudes towards prioritising digital subscriptions and sharing login details, 2022
                                                                                              • Longer trial length based on tier could encourage consumers to get more expensive plans
                                                                                                • Figure 32: Attitudes towards value, adverts and free trials in digital subscriptions, 2022
                                                                                              • Pay TV providers need to collate latest releases from streaming services
                                                                                                • Figure 33: Attitudes towards new video streaming releases, cost of living crisis and yearly rates for digital subscriptions, 2022
                                                                                              • A marketing theme of ‘short-term pain, long-term gain’ could convince people to buy yearly subscription
                                                                                                • Figure 34: Attitudes towards digital subscriptions, for those with a household income of under £15,500, 2022
                                                                                            • Appendix – Data Sources, Abbreviations and Supporting Information

                                                                                                • Abbreviations
                                                                                                  • Consumer research methodology

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