Digital Subscriptions - UK - 2022

Digital Subscriptions - UK - 2022

Overview

People who consider themselves to be struggling financially are actually more likely to have a video streaming service (62%) than those who consider themselves to be in a healthy financial position (44%). This indicates that as more consumers feel the strain of the cost-of-living crisis, many will actually turn to video streaming services as a good-value for money form of entertainment and escapism.

The impact of inflation is affecting even the highest income earners, as 55% of digital subscribers with a household income of 50,000 or over say the rising cost of living is making them consider cancelling a digital subscription. People do, though, highly value their subscriptions, with 42% of digital subscribers expecting to prioritise subscriptions over other leisure expenses during the next year, indicating many subscription offerings will perform better than expected. The cost-of-living crisis will inevitably still result in fiercer competition between digital subscription services, as people are financially forced to make decisions about which services they prioritise.

44% of digital subscribers share their login details with friends or family and Netflix has said the ability to do this is hindering its growth significantly. The company is experimenting with charging a fee for sharing account details outside of the home in several South American countries. If this strategy goes worldwide, and other video streaming subscriptions also begin to crack down further on password sharing, it will make it harder for people to have access to multiple streaming services.

With consumers becoming more budget conscious, subscription services are likely to introduce more tier options, to attract a wider range of subscribers. This can include cheaper ad-supported tiers (as Netflix and Disney+ are set to introduce) or tiers based on levels of content or features.

Key issues covered in this Report

Type of digital subscription that consumers have, including video streaming, music streaming, game streaming, newspapers and magazines, e-books and more.

Which video streaming and audio streaming services people are subscribed to.Which digital subscriptions people 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.

Market context

At the start of 2020, COVID-19 caused massive economic disruption, and UK GDP fell by 9.4% over the course of the year. There was further severe disruption throughout 2021, but the economy did make up much of 2020s lost output, and the Office for National Statistics estimates that UK GDP grew by 7.5% in 2021.

In its March 2022 Economic and Fiscal Outlook report, the Office for Budget Responsibility (OBR) revised its forecast for growth in UK GDP to 3.8% for 2022, down from the 6% forecast in October 2021. This more pessimistic outlook has been driven by the sharp rise in inflation and the impact this will have on consumer spending.

Since the OBRs March forecast, the economic outlook has deteriorated further. Inflation has continued to rise, driven by spiralling energy and motor fuel prices. CPI reached 9.4% in the 12 months to June 2022, and is expected to continue to rise during the rest of the year. This has prompted significant interventions from the Bank of England, which is tasked with maintaining CPI at a target of 2%. The Bank has increased the base rate of interest from 0.1% in December 2021 to 1.75% in August 2022, the highest rate since December 2008. This will boost returns for savers but increase the cost of debt for millions of borrowers.

In announcing the latest rate hike, the Bank of England issued the gloomiest forecast for the British economy so far, stating that it expects CPI to reach a peak of 13% later this year and remain very high throughout 2023. The Bank also forecast that the economy will fall into recession in Q4 2022 and shrink in each quarter in 2023. This projection is more pessimistic than that forecast by most independent forecasters but indicative of the increasingly negative outlook as high inflation causes the biggest squeeze on real incomes in decades.

The conflict in Ukraine is a key contributor to the current inflationary environment. Mintel research conducted in July shows that 76% think that the conflict will have an impact on their household finances, and more than two thirds of Brits expect the conflict to result in higher prices. These rising prices will lead to a historic drop in real incomes, and put consumer spending under pressure, even given the package of support measures announced by the Government.

The pressure on consumers finances was reflected in the OBRs latest forecast for 5.4% growth in household consumption in 2022, 4.4 percentage points lower than it projected in October. Even this forecast is now looking optimistic. This isnt only a challenge for UK consumers: Mintels tracker data shows that an increasing proportion of consumers across Europe are concerned about the impact of rising prices on their household finances and there are signs of consumers already taking a more cautious approach to spending.

There is more positive news in the labour market. The unemployment rate for the three months to May 2022 was 3.8%, and the OBR expects unemployment to remain relatively level at around 4.1% for the duration of its five year forecast period. There is, however, still the prospect of long-term scarring on employment, especially in the more exposed retail and hospitality sectors, and data on the self-employed and economic inactivity are less positive than the headline unemployment rate. The latest Bank of England forecast also takes a gloomier view of the labour market, predicting unemployment to rise to 6.25% by Q2 2025.

Products covered in this Report

This Report covers the market for digital subscriptions which is defined as an online service that users regularly pay to access, either on a monthly or yearly deal.

Digital subscriptions cover video (eg Netflix, Amazon Prime), audio (eg Spotify, Apple Music) and game streaming (eg Google Stadia, Xbox Game Pass), along with cloud storage (eg Dropbox, Google One), news and magazine platforms (eg iNews, TIME), fitness services (eg Apple Fitness+) and more.

Executive Summary

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, Consumer Technology Analyst

The five-year outlook for digital subscriptions

Figure 1 provides an overview of how we expect the category to perform over the coming five years.

FIGURE 1: Category outlook for digital subscriptions, 2022-27

Source: Mintel, prepared in July 2022

The market

Barclaycard data shows YoY decrease in spending on digital content and subscriptions

In July 2022, Barclaycard published data which found that UK card spending increased 6.2% YoY in June 2022, however spending on digital content and subscriptions decreased 2.9% YoY. This follows on from data in May where spending on digital content and subscriptions decreased by 5.7% YoY, highlighting the impact of the cost of living crisis, along with lifestyle changes as more normal habits resume, on this sector.

Companies and brands

Netflix and Disney+ to launch ad-based subscription options

In June 2022, Netflix announced it is adding a new tier to its subscription options, one which features ads in partnership with Microsoft. This comes in response to the companys revenue slowing significantly in the early months of 2022 due to the impact of the cost of living crisis. Netflixs co-CEO, Ted Sarandos, said in June 2022 that it is currently missing a market of people who accept watching ads if it means their plan is cheaper than Netflixs other options.

Disney+ also confirmed in March 2022 that it is adding an ad-based tier, starting in the US later in 2023. However, this is more a case of appealing to as many people as possible, instead of in response to disappointing revenue results. Disney+ in fact recorded 41.4 million subscribers in January 2022, marking a 40% YoY increase.

Spotify puts HiFi on backburner while developing podcast and audiobook focus

In February 2021, Spotify announced it would be launching Spotify HiFi before the end of the year to bring CD quality sound to the platform. However, this did not arrive, with a Spotify moderator saying on a community thread in January 2022 that there were no timing details to share. Instead, the company has been developing its podcast and audiobook functionality with the acquisitions of Podz and Findaway in June and November 2021 respectively.

Google Stadia continues to take a backseat approach to game streaming

In January 2022, Google announced changes to Google Stadia at the Games Developer Summit which further suggest it is taking a backseat approach with the platform. Users will be able to browse games without needing a Stadia account and as part of a program called Immersive Stream for Games, partnering companies will be able to display Stadia Games on their own website. An example showcased at the event was AT&T which enabled customers to play Batman: Arkham Knight, requiring only their AT&T number.

Apple Fitness+ adds meditation and Pilates sessions

In September 2021, Apple Fitness+ added meditation, Pilates and Get Ready for Snow Season content, as well as group workouts to its platform. There are nine themes for the meditation sessions: gratitude, kindness, awareness, creativity, resilience, purpose, focus, calm and wisdom and the videos last for five, 10 or 20 minutes. Meanwhile the Pilates videos last for 10, 20 or 30 minutes and the Get Ready for Snow Season videos are exercises designed to improve peoples endurance, balance and strength skills needed during winter sports.

The consumer

Video and music streaming provides escapism for consumers struggling financially

Consumers that consider themselves to be struggling financially are significantly more likely to have a video streaming service than those that consider themselves to be in a healthy financial position (62% compared to 44%), and they are also more likely to have a music streaming service (35% compared to 27%). This indicates that these platforms provide escapism for those struggling financially and they are more willing to compromise on other aspects of their spending.

FIGURE 2: Type of digital subscription, 2022

Which of the following paid-for digital subscriptions are you or someone in your household currently subscribed to? Please select all that apply.

Base: 2,000 internet users aged 16+

Source: Kantar Profiles/Mintel, May 2022

Sports-based content would bring more men to Netflix

While there are slight differences between men and women in terms of subscriptions across all video streaming services, the biggest gap is that women (87%) are much more likely to subscribe to Netflix than men (77%). One of the ways Netflix can get more male subscribers is by improving its sports-related content. Amazon Prime Video is strong in this area with its All or Nothing series and through streaming live games and this is likely to be one reason why more men (67%) are subscribed to the platform than women (63%).

FIGURE 3: Video streaming service subscribed to, 2022

Which of the following paid-for video streaming services are you or someone in your household currently subscribed to? Please select all that apply.

Base: 1,031 internet users aged 16+ who are subscribed to a paid-for video streaming service

Source: Kantar Profiles/Mintel, May 2022

Spotify falling behind on quality audio

While Spotify Premium is by far the most popular music streaming platform, it risks losing subscribers to other competitors due to its lack of higher quality audio. This is a common feature across the other music streaming platforms, however, it will not be coming to Spotify in the near future.

It is most at risk of losing Older Millennial subscribers as in August 2021, 75% of Older Millennials who had paid for a music streaming service in the previous three months said it is worth paying more to access higher audio quality on these platforms compared to the 69% average (see Music and other Audio: CDs, streaming, downloads & podcasts UK, 2021).

FIGURE 4: Music streaming service subscribed to, 2022

Which of the following paid-or music streaming services are you or someone in your household subscribed to? Please select all that apply.

Base: 579 internet users aged 16+ who are subscribed to a paid-for music streaming service

Source: Kantar Profiles/Mintel, May 2022

Inflation causes even the higher earners to consider cancelling their subscription

The cost of living crisis means that any digital subscription is at risk of its subscribers cancelling, regardless of the demographic. 35% of people with a household income of 50,000 or over have cancelled a digital subscription in the last year, compared to the 30% average. While the higher income earners are more likely to have multiple subscriptions to cancel, the fact that 55% of digital subscribers in this bracket also say the cost of living crisis is making them consider cancelling highlights the impact of inflation.

FIGURE 5: Digital subscription cancelled in the last year, 2022

Which of the following types of paid-for digital subscriptions have you cancelled in the last 12 months?

Base: 2,000 internet users aged 16+

Source: Kantar Profiles/Mintel, May 2022

Women are particularly likely to downgrade to new ad-supported subscription options

Women (68%) are more likely than men (59%) to prioritise a lower price when they are choosing to cancel one video streaming service over another. Furthermore, women are far less likely than men to prioritise user experience (25% compared to 32%) or a range of high-quality content (18% compared to 29%). This indicates that women would be the most likely to downgrade their subscription to a cheaper option, even if it means compromising on the adverts or features.

FIGURE 6: Factors when choosing which video streaming service to cancel, 2022

If you were choosing between two video streaming subscription services to cancel, which of the following would encourage you keep one over another? Please select all that apply.

Base: 1,031 internet users aged 16+ who are subscribed to a paid-for video streaming service

Source: Kantar Profiles/Mintel, May 2022

Streaming services must tread carefully with differentiating tiers

Over four in ten digital subscribers expect to prioritise subscriptions over other leisure expenses during the next year. Subscription-based platforms could therefore be encouraged to differentiate the tiers by putting exclusive content on the more expensive plans, or at least showing new shows and films first. However, they risk criticism from subscribers if they take this approach instead of keeping the tiers different based on features.

FIGURE 7: Attitudes towards prioritising and cancellations of digital subscriptions, 2022

Do the following statements apply to you?

Base: 1,347 internet users aged 16+ who currently have a paid for subscription service

Source: Kantar Profiles/Mintel, May 2022

Longer trial length based on tier could encourage consumers to get more expensive plans

55% of digital subscribers say free trial periods persuade them to take out new subscriptions, highlighting the importance of free trials during this period of financial uncertainty. Increasing the trial length based on the level of the tier would give subscribers extra incentive to try the more expensive tiers to see if they are worth it.

FIGURE 8: Attitudes towards adverts, value and free trial periods of digital subscriptions, 2022

Do the following statements apply to you?

Base: 1,347 internet users aged 16+ who currently have a paid for subscription service

Source: Kantar Profiles/Mintel, May 2022

A marketing theme of short-term pain, long-term gain could convince people to buy a yearly subscription

Subscription services do not always strongly promote their annual payment plans, likely because they believe that consumers would only be interested in the cheaper-looking monthly payments. However, this is not the case, with 57% of digital subscribers preferring to pay a discounted yearly rate instead of a monthly one. At a time where consumers have stricter budgets, brands can market annual plans with the angle of short-term pain, long-term gain in the sense that once it is paid, the customer is free from payments for the next year instead of having to continuously pay throughout that period.

FIGURE 9: Attitudes towards cost-of-living crisis and discounted yearly rates for subscriptions, 2022

Do the following statements apply to you?

Base: 1,347 internet users aged 16+ who currently have a paid for subscription service

Source: Kantar Profiles/Mintel, May 2022

Issues and Insights

Discounted yearly offers could appeal in times of high inflation

The impact of inflation is putting all digital subscriptions at risk across all consumers. 30% of people have cancelled a digital subscription in the last year and 58% of those with a subscription say the rising cost of living is making them consider cancelling one of these services. This does not only apply to lower income households but higher income ones as well, with 55% of digital subscribers with a household income of 50,000 or over considering cancelling a subscription.

As the digital subscriptions markets has evolved and grown, people have amassed many different subscriptions across sectors. Now they will be making decisions about which subscriptions they value the least to potentially cancel, and every service will want to ensure they are not first on the chopping block. Discounted yearly subscriptions have been used as a way for services to prevent churn in customers. While some consumers will be wary of the commitment of a yearly subscription, others will appreciate the longer-term savings and the certainty it provides; wary of companies raising prices in the wake of inflation. Mintels consumer research shows 57% of digital subscribers would prefer to pay a discounted yearly rate for digital subscriptions than a monthly rate, rising to 62% of 16-24 year olds and 65% of those with a household income of under 15,500.

Subscription services should give heavier promotion of their discounted yearly subscriptions to both potential new customers and existing customers, who could potentially be considering leaving, focusing on the short-term pain, long-term gain angle.

Services to introduce new tiers to provide more options for budget conscious consumers

As we have seen with other difficult economic periods, the impact on in-home entertainment can be complex. Some consumers look to reduce their in-home entertainment expenditure because it is a luxury, while others spend more on in-home entertainment, having restricted spend on other one-off leisure activities (eg eating at a restaurant). A similar story will likely play out with digital entertainment subscription content.

As discussed above, current financial struggles are pushing people to cancel subscriptions. However, many consumers do highly value their subscriptions. Over four in ten people (42%) who are paying for a digital subscription expect to prioritise these over other leisure expenses during the next year rising to 50% for those with a household income of under 15,500. This shows digital subscriptions will not be the first leisure expenditure that many drop, and potentially means some could be encouraged to spend more on a subscription over the coming period to get the best experience.

Going forward subscription services are likely to introduce a greater variety of tiered options to meet the different demands of all consumers resulting from the cost-of-living crisis. Services will want to ensure that they have a range of subscriptions options that make keeping or getting a new subscription financially feasible for even those very negatively impacted by the current economic situation, as well as attractive expensive tiers that appeal to those willing and able to spend more.

Netflix and Disney+ are set to introduce lower-priced ad-supported subscription tiers in 2023 to make the services more accessible. Mintels research shows that 61% of digital subscribers would prefer to watch a free ad-supported video streaming service than pay a monthly subscription for no adverts, showing willingness to compromise on experience for savings. Within an increasingly competitive marketplace, having a lower-priced ad-supported tier should help attract and retain subscribers, while providing an additional revenue source, and it is likely that ad-supported tiers from other services will also be introduced.

Netflix has said it is aiming for greater differentiators between tiers, with ads and no ads being an example. It has also said the library of content on the ad-based tier will not include all of the same content as in the more expensive plans. Streaming services should tread carefully when it comes to the differences between tiers as the change in content could cause a backlash from subscribers.

It is possible that platforms will make changes such as offering exclusive shows on the more expensive plan as they aim to take advantage of the consumers who will prioritise subscriptions over other leisure. However, they risk facing criticism from customers, particularly during the cost-of-living crisis. Instead, streaming services should focus on differentiating the tiers with features, such as access to higher resolution content or the number of users allowed, instead of the actual content.

Market Drivers

The five-year outlook for digital subscriptions

Figure 8 provides an overview of how we expect the category to perform over the coming five years.

FIGURE 10: Category outlook for digital subscriptions, 2022-27

Source: Mintel, prepared in July 2022

Inflation is the key concern in 2022 for consumers, brands and the economy

The first three quarters of 2022 have been defined by rapidly rising inflation, creating a profound increase in the cost of living. The most common measure for rising prices is the Consumer Price Index (CPI), which tracks the cost of a representative basket of goods and services, and by June 2022 CPI had reached 9.4%. Inflation is expected to continue to rise in the final quarter of the year, with the Bank of England issuing the most pessimistic outlook so far in August when it forecast CPI to reach 13% by the end of 2022.

There are a number of factors behind the increase in CPI. One is the fact that as the economy has re-opened, consumer demand has increased and this, in turn, tends to push up prices. Global supply shortages are also playing a part, while labour shortages are driving up wages which, in turn, means that companies are under pressure to pass increased costs onto consumers. The conflict in Ukraine is adding even more inflationary pressure.

Consumer spending power will be curbed

The impact of rising inflation on household finances will vary significantly between different consumer groups. While all but the wealthiest will feel the heat of rising prices in some way, it is inevitably those who already had tight finances who will be hardest hit. Lower earners tend to spend a greater proportion of their incomes on essentials such as household bills, fuel and grocery items. The current surge in inflation is being driven by these categories, so it will have a disproportionate effect on their finances.

The most affected consumers will find their spending power seriously weakened, while millions of households will need to make changes in order to make ends meet. Research conducted by Mintel in July 2022 found that 46% of consumers expect to cut back on non-essential spending as a response to rising prices, rising to 58% of those who describe their finances as tight and 59% who are already struggling. 36% expect to reduce how much they spend on socialising, 35% think they will shop more at discount retailers and 34% expect to buy more own-label goods. Again, less well-off consumers are more likely to say they will take these measures.

Barclaycard data shows YoY decrease in spending on digital content and subscriptions

In July 2022, Barclaycard, which it says represents nearly half of the nations credit and debit card transactions released its monthly tracker on card spending in June 2022. It found that while overall card spending increased 6.2% YoY, spending on digital content and subscriptions decreased 2.9% compared to June 2021. The decrease was even more significant for May 2022 where spending on digital content and subscriptions was down 5.7% YoY.

It should be noted though that while inflation is a factor in this decrease, another factor is that the spending on subscriptions was particularly high due to the impact of the pandemic. The data has been compared to May and June 2021 where the UK was emerging from the end of the lockdowns, but it is likely that many still had subscriptions or viewing habits continuing from the lockdowns. In March 2021, 80% of consumers who had watched on-demand TV in the previous three months had used a paid-for streaming service, compared to 73% in July 2019 (see Attitudes Towards Video and TV UK, 2021). Therefore a decrease in 2022 was expected, however it has been worsened by the cost of living crisis.

Mintels consumer data also highlights the impact of inflation on digital subscriptions, with 30% of consumers having cancelled a subscription in the last year (see Cancellations of Digital Subscriptions). 58% of digital subscribers also said the rising cost of living is making them consider cancelling a subscription. However, the outlook for the coming year is not as concerning as these stats suggest, with 42% of digital subscribers expecting to prioritise subscriptions over other forms of leisure (see Attitudes towards Digital Subscriptions).

Parents have spent more on digital entertainment for their children since COVID-19

Video streaming services benefited significantly from the COVID-19 lockdowns, with Mintels consumer data finding in March 2021 that 69% of people had watched on-demand TV series in the previous three months compared to 59% in July 2019 (see Attitudes Towards Video and TV UK, 2021).

More recent data from December 2021 found that 37% of parents were spending more on digital entertainment for their children then they were before the pandemic, compared to just 8% who were spending less (see Marketing to Parents UK, 2022). This ranked higher than spending more on things like educational resources (30%), adding to a childs savings account (24%), childcare (23%) or days trips with the family (22%).

Spending more on digital entertainment indicated that despite lockdown restrictions being removed in the second half of 2021 many parents kept their digital subscriptions, pointing to a long-term boost to the market.

While spend will have been reduced by the impact of the cost of living crisis, as highlighted by Barclaycards data, the pandemic will have likely boosted parents inclination to get digital content for their children longer term. Mintels consumer research shows that parents with children aged 18 or under are significantly more likely to have a digital subscription (87%) than those with children aged over 18 (56%) or without children (65%), making them a strong target market for digital subscriptions (see Interactive Databook).

For further discussion of how media subscriptions are used by children see Mintels Media Trends Spring UK, 2022 Report.

Subscriptions to Digital Services

Video and music streaming provides escapism for consumers struggling financially

People who feel they are struggling financially are significantly more likely to have a video or music streaming service than those that consider themselves to be in a healthy financial situation. This indicates that despite struggling financially, people are not willing to sacrifice having a streaming service and are more willing to compromise in other aspects of their life. It is likely that video and music streaming services provide a good value for money form of escapism for these consumers from the stresses of everyday life. This is also highlighted by the fact that 50% of digital subscribers with a household income of under 15,500 expect to prioritise digital subscriptions over other leisure expenses in the next 12 months, compared to the 42% average (see Attitudes towards Digital Subscriptions).

FIGURE 11: Type of digital subscription, 2022

Which of the following paid-for digital subscriptions are you or someone in your household currently subscribed to? Please select all that apply.

Base: 2,000 internet users aged 16+

Source: Kantar Profiles/Mintel, May 2022

FIGURE 12: Type of digital subscription, by financial situation, 2022

Which of the following paid-for digital subscriptions are you or someone in your household currently subscribed to? Please select all that apply.

Base: 2,000 internet users aged 16+

Source: Kantar Profiles/Mintel, May 2022

Bundles will appeal to those struggling financially

The importance of digital subscriptions to people who are in a difficult financial position is also shown by the number of different types of services they are subscribed to. Consumers who say they are struggling or in-trouble financially are just as likely to have four to nine types of digital subscriptions as those who say they are in a healthy financial position.

This highlights the value of bundles of different types of subscription services in the future (see Cancellations of Digital Subscriptions). Bundles will appeal to consumers struggling financially as they will not only save money, but it will also enable them to collate their payments into one bill.

FIGURE 13: Repertoire for subscriptions to types of digital services, 2022

Which of the following paid-for digital subscriptions are you or someone in your household currently subscribed to? Please select all that apply.

Base: 1,347 internet users aged 16+ who currently subscribed to or have someone in their household currently subscribe to a paid-for digital subscription

Source: Kantar Profiles/Mintel, May 2022

FIGURE 14: Repertoire for subscriptions to digital services, by financial situation, 2022

Which of the following paid-for digital subscriptions are you or someone in your household currently subscribed to? Please select all that apply.

Base: 1,347 internet users aged 16+ who currently subscribed to or have someone in their household currently subscribe to a paid-for digital subscription

Source: Kantar Profiles/Mintel, May 2022

Digital Subscriptions - UK - 2022

Type of Music Streaming Service

Spotify falling behind on quality audio

While Spotify Premium is by far the biggest music streaming service in terms of subscriptions, it risks losing subscribers to other streaming platforms the longer it goes without high quality music. As discussed in Competitive Strategies, Spotify is not getting Hi-Fi audio in the near future, and it is available on many of its rivals.

Not including this feature is putting Spotify at risk of losing Older Millennials subscribers in particular. In August 2021, 75% of Older Millennials who had listened to music and paid for a music streaming service in the previous three months said it is worth paying more to access higher quality music on these platforms, compared to the 69% average (see Music and other Audio CDs, streaming, downloads & podcasts UK, 2021). Older Millennials are already less likely than average to use Spotify and not being able to listen to higher quality audio will drive even more of them towards other music streaming services.

FIGURE 20: Music streaming service subscribed to, 2022

Which of the following paid-or music streaming services are you or someone in your household subscribed to? Please select all that apply.

Base: 579 internet users aged 16+ who are subscribed to a paid-for music streaming service

Source: Kantar Profiles/Mintel, May 2022

FIGURE 21: Music streaming service subscribed to, for Older Millennials, 2022

Which of the following paid-for music streaming services are you or someone in your household subscribed to? Please select all that apply.

Base: 579 internet users aged 16+ who are subscribed to a paid-for music streaming service

Source: Kantar Profiles/Mintel, May 2022

Subscriptions to multiple music streaming services could also point to the movement away from Spotify

A significant number of music streaming subscribers are actually subscribed to multiple platforms. With content on music streaming services being more universal than that on video streaming services, it is more surprising that people have multiple music platforms. This could perhaps also suggest some of the movement away from Spotify as discussed above.

66% of those who have multiple music services have Spotify, 54% have Apple Music and 52% have Amazon Music Unlimited, so the majority of people with multiple music platforms have Spotify and one other. Therefore, these subscribers may have a subscription to Spotify having used it in the past but now they use another service like Apple Music or Amazon Music more regularly. With Spotify not adding higher quality music, it again risks these subscribers just cancelling it altogether in favour of another platform.

FIGURE 22: Repertoire for subscriptions to music streaming services, 2022

Which of the following paid-for music streaming services are you or someone in your household subscribed to? Please select all that apply.

Base: 526 internet users aged 16+ who are subscribed to a paid-for music streaming service and have specified those they are subscribed to

Source: Kantar Profiles/Mintel, May 2022

FIGURE 23: Repertoire for subscriptions to music streaming services, crossed by type of music streaming platform subscribed to, 2022

Which of the following paid-for music streaming services are you or someone in your household subscribed to? Please select all that apply.

Base: 526 internet users aged 16+ who are subscribed to a paid-for music streaming service and have specified those they are subscribed to

Source: Kantar Profiles/Mintel, May 2022

Smart downloads feature for Spotify Premium would appeal to mobile users

56% of people who subscribe to a music streaming service, subscribe to Spotify Premium. This rises to 62% of people who work mainly or entirely out of home, significantly higher than those who work mainly or entirely at home (50%). This indicates that Spotify Premium users are more likely to be using the platform on the go as opposed to in their house and therefore downloaded content will play a more important role.

YouTube Premium is currently trialling its smart downloads feature which automatically downloads 10 recommended videos over a Wi-Fi network (see Launch Activity and Innovation). This feature is also available on YouTube Music, however the user base for this platform is far smaller than for Spotify Premium. If Spotify were to offer a smart downloads feature, it could promote different artists to listeners but also ensure that those who use the service outside of their home always have something to listen to on the go.

FIGURE 24: Subscriptions to Spotify Premium, by working situation, 2022

Which of the following paid-for music streaming services are you or someone in your household subscribed to? Please select all that apply. [Spotify Premium]

Base: 579 internet users aged 16+ who are subscribed to a paid-for music streaming service

Source: Kantar Profiles/Mintel, May 2022

Podcasts can be a strong promotional option for video streaming services

There is substantial crossover between those subscribing to video services and music services, with 43% of video streaming subscribers also being subscribed to a music streaming platform, compared to 29% of all consumers. This means there can be a lot of value in video and music streaming services promoting each other. For example, video streaming services can partner with podcasters on music streaming platforms, with the podcasters promoting the video streaming services by highlighting specific content likely to appeal to the listenership of that particular podcast.

There is also significant potential in streaming services producing podcasts as an extension of TV programmes, featuring behind-the-scenes content with the actors and production, along with fan analysis and discussion (see Attitudes towards Video and TV UK, 2022 for further discussion).

Spotify hub promotes major video streaming services

In November 2021 Netflix and Spotify expanded their partnership with the launch of the Netflix Hub on Spotify (see Competitive Strategies), with the two market leaders in their sectors recognising the value that greater collaboration can offer. Along with official playlists from Netflix TV shows, the hub also promotes Netflix official podcasts. Spotify has already offered a similar hub for Disney+ since 2019.

As Apple offers such a range of content services (eg Apple Music, Apple TV, Apple Podcasts) it has the ability to be very strong on cross-promotion of its original content between services. Competitor services are therefore looking to utilise each other to provide the same cross-sector promotion.

Spotify and Netflix are likely to find the most mutual benefit in closer collaboration, as they look to compete with larger companies. It is likely the two services will further expand their partnership over the coming years.

FIGURE 25: Subscriptions to streaming services, crossed by subscriptions to video streaming services, 2022

Which of the following paid-for digital subscriptions are you or someone in your household currently subscribed to? Please select all that apply.

Base: 1,031 internet users aged 16+ who are subscribed to a video streaming service

Source: Kantar Profiles/Mintel, May 2022

Digital Subscriptions - UK - 2022

Biggest Motivations to Keep a Video Streaming Service

Women are particularly likely to downgrade to new ad-supported subscription options

When deciding to keep one video streaming service over another, women are significantly more likely to prioritise pricing than men. Men are more interested than women when it comes to additional features such as higher quality content or a better user experience.

This means that the entry level tiers for video streaming services, which feature the absolute essential features and not more, are what women in particular are likely to choose. Netflix and Disney+s ad-based versions (see Launch Activity and Innovation) will therefore likely appeal the most to women, who will be more likely to compromise on user experience for the cheaper version.

As discussed in Launch Activity and Innovation, while the launches should bring in new subscribers, some will also opt to downgrade, and this is particularly the case for female users. Disney+ has even stated that it ultimately expects the majority of subscribers to downgrade. Some of those who downgrade may otherwise have decided to cancel their subscription, so the service will retain some of that revenue.

FIGURE 29: Factors when choosing which video streaming service to cancel, 2022

If you were choosing between two video streaming subscription services to cancel, which of the following would encourage you to keep one over another? Please select all that apply.

Base: 1,031 internet users aged 16+ who are subscribed to a paid-for video streaming service

Source: Kantar Profiles/Mintel, May 2022

FIGURE 30: Factors when choosing which video streaming service to cancel, by gender, 2022

If you were choosing between two video streaming subscription services to cancel, which of the following would encourage you to keep one over another? Please select all that apply.

Base: 1,031 internet users aged 16+ who are subscribed to a paid-for video streaming service

Source: Kantar Profiles/Mintel, May 2022

Netflixs original series to help its loss of well-known titles

Access to the latest releases and a bigger back-catalogue are also among the top considerations when choosing which service to keep and this will benefit the current main challenger brands to Netflix. The market leader lost the rights to Star Wars in 2019, with the series now exclusively on Disney+, Netflix also lost an array of Marvel series to Disney+ in March 2022 (see Type of Video Streaming Service) and Netflixs US audience lost the final remaining series of Star Trek in July 2022 which is now available through Paramount+. While these changes may have been a factor in the drop in subscriber numbers for the company, Netflixs strong focus on its original content with series such as Stranger Things and Squid Game will help mitigate the impact. The platform has been building up a strong back-catalogue of its own original content that will be crucial as it loses more licensed content.

Consumers are not particularly concerned with alternative content on video streaming services

When deciding between video streaming platforms, access to content other than video ranks bottom of the listed priorities. This indicates that despite Netflixs attempts to expand its platform to gaming, the vast majority of subscribers simply care about the video content rather than anything else. They may use the games on a video streaming platform, but it is not an important feature to them when compared to pricing or range of video content.

Therefore, video streaming services which are intending to expand to other categories could be better served developing partnerships with other subscription services rather than creating their own content, with Netflixs expanding partnership with Spotify as an example of this (see Competitive Strategies).

Type of Video Streaming Service

Sports-based content would bring more men to Netflix

Despite being the market leader by far, Netflixs subscriber numbers have dropped significantly since the start of 2022. The company said in April 2022 it lost 200,000 subscribers globally between January and March 2022 and then it lost a further 970,000 subscribers in the following three months.

In the UK 82% of those with a video streaming subscription have Netflix, highlighting its ongoing dominance. In terms of subscriptions across genders, while there are differences between men and women across all the video streaming services, the biggest gap is with Netflix. With this platform being significantly favoured by women, one of the ways that Netflix can engage more men is the inclusion of more sports-related content. In March 2022, 42% of men who had watched video or TV content in the previous three months described sports content as exciting to watch, compared to 20% for women (see Attitudes Towards Video and TV UK, 2022).

Amazon Prime Video surpasses Netflix in this aspect due to its All or Nothing series which has featured several Premier League teams since 2018 and its incorporation of live sporting games. This is likely to be a factor in more men being subscribed to Amazon Prime Video than women. In fact, there is not a category on Netflix for Sport at the time of writing, highlighting how its focus is on other genres.

The company is trying to change this however, as Business Insider reported in June 2022 that Netflix is bidding against ESPN and NBCUniversal for live streaming rights for F1. F1 is reportedly looking for a deal around $100 million (82 million). Continuing to developing its sports-related content would help balance out the amount of male and female subscribers on Netflixs platform.

FIGURE 15: Video streaming service subscribed to, 2022

Which of the following paid-for video streaming services are you or someone in your household currently subscribed to? Please select all that apply.

Base: 1,031 internet users aged 16+ who are subscribed to a paid-for video streaming service

Source: Kantar Profiles/Mintel, May 2022

FIGURE 16: Video streaming service subscribed to, by gender, 2022

Which of the following paid-for video streaming services are you or someone in your household currently subscribed to? Please select all that apply.

Base: 1,031 internet users aged 16+ who are subscribed to a paid-for video streaming service

Source: Kantar Profiles/Mintel, May 2022

Mobile network providers selling iPhones should focus incentives on Netflix

It is common for network providers to offer incentives such as a subscription to a streaming service for a limited time when the user agrees to a contract with that network provider. For networks that are selling the iPhone, they should focus their incentives on Netflix in particular ahead of other video streaming platforms due to the engagement that women have with Netflix. Women are more likely to have an iPhone than men, as in February 2022, 41% of women who had a smartphone had an iPhone compared to 31% for men, highlighting women as the stronger target market for iPhone-related incentives (see Smartphones UK, 2022).

Disney+s addition of Marvel series will help to expand audience

Disney+s approach to being focused on family-based content has contributed to its popularity particularly with dual-parent families. While families are more likely to have Netflix and Amazon Prime compared to the average, the difference is significantly greater with Disney+.

In March 2022, Disney announced it was bringing an array of Marvel shows to Disney+ later in the month. Luke Cage, Jessica Jones, The Defenders, Marvels Agents of S.H.I.E.L.D, Daredevil, The Punisher and Iron Fist had been only available through Netflix but were moved to Disney+. As part of the announcement, Disney said that there will also be a new prompt for subscribers to update their parental controls. This enables viewers to set restrictions based on each profile, as well as lock particular profiles.

The fact that some of the titles in the list are certified 18+ highlights that Disney+ is aiming to expand its viewership to compete further with its rivals. With it taking these series off of Netflix puts it in a strong position to continue to build its quickly growing subscriber base.

FIGURE 17: Video streaming service subscribed to, by dual parent families, 2022

Which of the following paid-for video streaming services are you or some in your household currently subscribed to? Please select all that apply.

Base: 1,031 internet users aged 16+ who are subscribed to a paid-for video streaming service

Source: Kantar Profiles/Mintel, May 2022

Entry level plans can target consumers who are currently settling on two video streaming subscriptions

Nearly a third of video streaming subscribers are subscribed to two of these platforms, making this the most common number. Furthermore, people with two video streaming subscriptions are significantly more likely to have cancelled a video streaming service in the last year than those currently with three video subscriptions (cancellations are discussed further in Cancellations of Digital Subscriptions). This suggests that a section of consumers had to compromise on their video streaming by reducing the number of subscriptions to two platforms.

Going forwards, the efforts from video streaming services to offer various tiers to appeal to as many consumers as possible (see Issues and Insights) is again key for this section of consumers. Having a tier which currently undercuts all of that platforms other options encourages consumers to downgrade and stay with the service instead of cancelling. Meanwhile it is also likely to encourage those who have reduced from three to two video streaming subscriptions to return.

FIGURE 18: Repertoire for subscriptions to video streaming services, 2022

Which of the following paid-for video streaming services are you or someone in your household currently subscribed to? Please select all that apply.

Base: 1,024 internet users aged 16+ who are subscribed to a paid-for video streaming service and have specified those they are subscribed to

Source: Kantar Profiles/Mintel, May 2022

FIGURE 19: Repertoire for subscriptions to video streaming services, crossed by cancellations of video streaming services, 2022

Which of the following types of paid-for digital subscriptions have you cancelled in the last 12 months?

Base: 1,024 internet users aged 16+ who are subscribed to a paid-for video streaming service and have specified those they are subscribed to

Source: Kantar Profiles/Mintel, May 2022

Highlighting Apple TV+ outside of Apple devices could be a point of expansion

Subscriptions to Apple TV+ are well below Netflix, Amazon Prime Video and Disney+ despite Apple TV+ being the cheapest option of all of them at 4.99 per month. It is likely that subscriptions for Apple TV+ are so much lower because many people associate it with being part of Apples ecosystem and therefore only available via Apple products. This is not the case however, with the service being available via a range of smart TVs and on Android via the web browser. Highlighting its support on other operating systems outside of Apple devices is likely to encourage more consumers to subscribe, particularly with its price point.

Cancellations of Digital Subscriptions

Inflation causes even the highest earners to consider cancelling their subscriptions

The cost of living crisis puts all digital subscriptions at risk across all users as 35% of those with a household income of 50,000 or over have cancelled a subscription across the last year, compared to the 30% average. While the higher income means that these people have more digital subscriptions than lower income consumers (see Interactive Databook), the fact that the higher earners are feeling the need to cancel highlights the impact of inflation. Furthermore, 55% of people with a household income of 50,000 or over say the rising cost of living is making them consider cancelling a digital subscription.

This is creating an increasingly competitive environment within the video streaming market in particular, where people have been prone to have multiple subscriptions at once, as well as between subscription types.

Newspapers and magazines should use perks to retain subscribers

When looking at the highest earners, and in particular those with a household income of 75,000 or over, 9% of them have cancelled a news platform in the last year. This ranks second only to video streaming (18%) in terms of the subscription they are most likely to have cancelled. This indicates that these consumers see news platforms as an expendable subscription despite it arguably being more valuable information than what they would find in other digital subscriptions. Consumers feel as though they can compromise on having the additional expert comment that paid news platforms provide and instead rely on information from free sources.

Online magazines platforms are also facing difficulty in retaining subscribers, which has led The Economist to introduce measures such as webinars only for subscribers and getting its customer services representatives to speak to customers before they leave, offering them a discounted deal (see Magazines UK, 2021). These kinds of initiatives or perks are key in ensuring that consumers stay subscribed to newspaper or magazine platforms despite the cost of living crisis.

Apple One could appeal to high earners considering cancelling services

At a time where even the highest earners are feeling the need to reduce their subscriptions, Apple needs to use this moment to promote the savings through its Apple One bundle. Apple One can appeal to the higher income earners due to this demographic being more likely to be in Apples ecosystem. In November 2021, 21% of people who had a desktop or laptop with a household income of 75,000 or more had a Mac computer, compared to the 11% average (see Computers UK, 2022) and in February 2022, 51% of smartphone owners who had a household income of 75,000 or over had an iPhone, compared to the 36% average (see Smartphones UK, 2022).

The Premier option for Apple One provides six subscriptions in one, including Fitness+, Music, News+, Arcade, iCloud+ and TV+ for 29.95 per month, which the company says is 22 cheaper than buying these services individually. Apple needs to promote these savings now, with the higher earners also likely to be engaged by the fact that they can stay in the companys ecosystem and pay for several services with one bill.

Other major franchises could offer bundles in the future

For consumers across other incomes, there is the potential for other major companies to offer bundles. Mintels consumer data shows that the vast majority of video streaming subscribers do not particularly care about a video streaming service offering different types of content, such as mobile games being added to Netflix (see Biggest Motivations to Keep a Video Streaming Service).

Therefore, what could be a better strategy from Netflix, or equivalent streaming services, would be to offer a bundle partnering with other subscription types like Spotify. If Netflix were to partner with other types of subscription services across news, fitness or cloud, it would be appealing as a bundle option. Bundles would be engaging in both the short- and the long-term due to the savings made and the added convenience compared to having various separate subscriptions.

FIGURE 26: Digital subscription cancelled in the last year, 2022

Which of the following types of paid-for digital subscriptions have you cancelled in the last 12 months?

Base: 2,000 internet users aged 16+

Source: Kantar Profiles/Mintel, May 2022

FIGURE 27: Digital subscription cancelled in the last year, for people with a household income of 50,000 or over, 2022

Which of the following types of paid-for digital subscriptions have you cancelled in the last 12 months?

Base: 2,000 internet users aged 16+

Source: Kantar Profiles/Mintel, May 2022

FIGURE 28: Attitudes towards cancellations of digital subscriptions, 2022

Do the following statements apply to you?

Base: 1,347 internet users aged 16+ who currently have a paid for subscription service

Source: Kantar Profiles/Mintel, May 2022

Attitudes towards Digital Subscriptions

Streaming companies should follow Netflix and Disney+s approach on ad-based tiers

While 42% of digital subscribers expect to prioritise subscriptions over other leisure expenses during the next year, it drops to 40% of those who are subscribed to three video streaming services. So instead of people who are more active video streamers expecting to prioritise these over leisure, there is a real possibility that they may cancel at least one of their services. Women (26%) are more likely than men (22%) to have three video streaming services (see Interactive Databook), indicating that female users may be more likely to cancel a subscription as they cut down on the number they have.

More streaming platforms should follow the approach from Netflix and Disney+ in offering an ad-based tier. 60% of women who have digital subscriptions would prefer to watch a free video streaming service with adverts than pay a monthly subscription for one with adverts. This indicates a willingness to watch adverts if it means they can get a cheaper plan and therefore streaming platforms should offer an ad-based tier to prevent a section of consumers, particularly women, from cancelling.

Streaming services must tread carefully with differentiating tiers

The intention to prioritise digital subscriptions over leisure will mean some consumers simply keep their subscriptions while they reduce spend elsewhere, but others may be willing to spend more on their digital subscriptions as they are forming a more important aspect of their leisure time.

As discussed in Launch Activity and Innovation, Netflix will be differentiating tiers more going forwards with one of the variables being adverts or no adverts. There will also be some content that is not available on the ad-based tier, which is another differentiator. Current differences that it already has are the inclusion of Ultra HD or more screens viewing at the same time.

While having more varied subscription tiers means that they can appeal to a wider range of people, streaming services must be careful to not cause backlash from subscribers. With a section of digital subscribers possibly intending to spend more over the next year, streaming services could be encouraged to introduce more differentiators for their higher tiers. An example would be to release TV shows or films first on the most expensive tiers in an attempt to get subscribers to upgrade. However, they risk customers reacting negatively to this; right now content is consistent throughout the tiers. Streaming services should therefore focus the differentiators on features more than content.

FIGURE 31: Attitudes towards prioritising digital subscriptions and sharing login details, 2022

Do the following statements apply to you?

Base: 1,347 internet users aged 16+ who currently have a paid for subscription service

Source: Kantar Profiles/Mintel, May 2022

Longer trial length based on tier could encourage consumers to get more expensive plans

Mintels research shows the impact of free-trial periods for encouraging people to get a new subscription. 55% of digital subscribers have been persuaded to take out a new subscription by the free trial period, rising to 60% of those with a household income of less than 15,500.

Free trials can be a particularly important element for attracting new subscribers during this period of financial uncertainty, helping ensure potential subscribers do not go elsewhere and feel confident to give a service a go. Offering longer trial periods than the typical 30 days, may therefore be necessary, even for a short period. For example, in June 2022 Amazon had a time-limited promotion offering a three-month free trial period to its Music Unlimited service. Such promotions will encourage immediate take-up and help ensure people become attached to a service.

As discussed in Issues and Insights, different priced tiers are likely to become even more common. Longer free trial periods could be effective for more expensive plans, to convince people of the value of the additional benefits, particularly those from lower income households.

FIGURE 32: Attitudes towards value, adverts and free trials in digital subscriptions, 2022

Do the following statements apply to you?

Base: 1,347 internet users aged 16+ who currently have a paid for subscription service

Source: Kantar Profiles/Mintel, May 2022

Pay TV providers need to collate latest releases from streaming services

With the amount of video streaming services to choose from, the majority of digital subscribers find it difficult to keep up with the latest releases. Sky Q has been able to show Netflix titles on its homepage since 2018 for Ultimate On Demand subscribers, and over the last two years Virgin Media has added a universal search on select TV boxes to find Netflix or Amazon Prime Video without opening the respective apps.

However, it is important that pay TV providers take this a step further to incorporate all the key video streaming services on the homepage for their boxes. This would present the latest titles from any platform that the user has signed into and it would enable consumers to keep up with the latest programmes more easily.

FIGURE 33: Attitudes towards new video streaming releases, cost of living crisis and yearly rates for digital subscriptions, 2022

Do the following statements apply to you?

Base: 1,347 internet users aged 16+ who currently have a paid for subscription service

Source: Kantar Profiles/Mintel, May 2022

A marketing theme of short-term pain, long-term gain could convince people to buy yearly subscription

Now is the time for brands to make a stronger advertising and marketing push for annual subscriptions. Companies should focus on the short-term pain, long-term gain angle of subscribers having to pay a larger upfront fee but that they will save money longer term and not have to worry about payments. A yearly deal should appeal at this moment in particular as uncertainty about inflation will make consumers particularly wary about potential price rises for monthly subscriptions.

Lower income homes are again the most likely to prefer yearly payments which shows their engagement in streaming services and willingness to pay more upfront despite having more limited disposable income.

FIGURE 34: Attitudes towards digital subscriptions, for those with a household income of under 15,500, 2022

Do the following statements apply to you?

Base: 1,347 internet users aged 16+ who currently have a paid for subscription service

Source: Kantar Profiles/Mintel, May 2022

Competitive Strategies

Netflix to possibly charge subscribers to share password outside of home members

In April 2022, a letter from Netflix informed its shareholders that its revenue growth had slowed considerably across the previous quarter, with the cost of living crisis forcing people to cancel their service. Netflix said that one of the ways it hopes to bring back revenue is to monetise the sharing of passwords across multiple homes. It stated that 222 million homes worldwide pay for the streaming service but account details are shared with a further 100 million homes, which is restricting revenue. It added in the letter:

Weve always tried to make sharing within a members household easy, with features like profiles and multiple streams. While these have been very popular, theyve created confusion about when and how Netflix can be shared with other households.

Netflix is already testing this change in Costa Rica, Chile and Peru. In March 2022, it added an option called Add an Extra Member, charging $2.99 to share the account with another home. In the latest earnings release, Netflix said:

Theres a broad range of engagement when it comes to sharing households from high to occasional viewing. So while we wont be able to monetise all of it right now, we believe its a large short- to mid-term opportunity.

The company is also introducing an ad-based subscription option as it aims to recover the revenue lost since the impact of inflation and competitor services (see Launch Activity and Innovation).

South American subscribers and Netflix staff left confused over password charge

In May 2022, new technology outlet Rest of World published details on its investigation into how South America subscribers were feeling about Netflix charging to share passwords. The outlet interviewed over 12 Netflix subscribers in Peru, with some saying they were unaware of any change to sharing passwords; some being aware but ignoring the message and some even cancelling their subscription altogether. There were no repercussions for those who ignored the prompt, highlighting that Netflix is not enforcing this measure despite its revenue figures.

Rest of World said that subscribers have in fact been left confused over how Netflix even defines sharing a password with a different household. The company told the outlet that household meant that the password could only be shared for free with people living in the same home as the account holder. There can also be blurring of the lines when it comes to instances such as when a person from the same household wants to use the account from another location, although Netflix is said to allow this at no extra cost.

An anonymous customer service representative from Netflix told Rest of World that even the representatives were confused about what to say when asked about the change in policy.

Netflix is either unable to differentiate households or is not enforcing the charges

The fact that subscribers are able to ignore the prompt to pay and continue to use their service as normal indicates that Netflix is unable to differentiate whether someone is accessing another homes account. Either this, or it is choosing not to enforce the rule.

The fact that 44% of digital subscribers share their login details with a friend or family member highlights the revenue Netflix is potentially missing out on (see Attitudes towards Digital Subscriptions). However, this kind of policy it is trialling only works if it is enforced, otherwise the vast majority of subscribers will just ignore the message. One might have expected Netflix to be able to identify whether someone is using an account of a different household, for example using an IP address, however this does not seem to be the case.

It could be a case of the company being hesitant to enforce this policy over concerns that subscribers will cancel their service. There will be a section that cancel; 64% of video streaming subscribers prioritise a lower price when deciding between services (see Biggest Motivations to Keep a Video Streaming Service) and the policy could cause significant increases to their monthly bill. As a way to counteract this, Netflix should advise those considering cancelling to get its entry level ad-based tier once it is launched to ensure that subscribers stay and can afford to continue paying.

Netflix mobile gaming is expected to be just the start

In July 2021, Netflix launched the first games on its platform (see Music and other Audio CDs, streaming, downloads, & podcasts UK, 2021). Bloomberg confirmed earlier in the month that Netflix was set to launch this, having spoken to a person familiar with the situation. The news outlet then added in November 2021 that it expect[s] Netflix to eventually upgrade its gaming service by turning it into a cloud-first platform. This means that the mobile games that Netflix is currently offering is just the start and that in the coming years, it could be a direct rival to the likes of Google Stadia and Xboxs Game Pass.

The game streaming market is growing significantly, with 13% of consumers having a subscription, rising to 21% of Millennials and 26% of Generation Z (see Subscriptions to Digital Services). It has also meant that PlayStation has had to launch its own cloud gaming service to compete (see Launch Activity and Innovation). The benefit of Netflix doing it would be to expand its content, as many consumers use multiple streaming services and the company can ensure that users stay in the Netflix app.

Focusing on audio first

There are major doubts over how much consumers care about a video streaming platform having other types of content (see Biggest Motivations to Keep a Video Streaming Service). However, if Netflix is to continue in this direction, it would be better for it to focus on audio content. There is a more seamless transition between the two types of content than with gaming and it takes less investment to make high-quality audio content than games. Netflix is focusing increasingly on audio and has partnered with Spotify to create the Netflix Hub. The Netflix Hub, which launched in November 2021, includes playlists with songs from Netflixs films and TV shows, as well as podcasts with the actors.

Continuing to create original audio content and add it to the Spotify Hub will be more beneficial for Netflix in the short to medium term than attempting to immediately go all-in on game streaming It can slowly build-up its library of games over time to create a competitive gaming option.

Spotify puts HiFi on backburner while developing podcast and audiobook focus

In February 2021, Spotify said that it would be launching Spotify HiFi before the end of the year, which would bring CD quality sound when listening (see Headphones UK, 2022). However, this feature has not yet arrived at the time of writing, and it remains unclear when it will.

In January 2022, a Spotify moderator called Yordan responded to a Spotify Community Thread, saying:

We know that HiFi quality audio is important to you. We feel the same, and were excited to deliver a Spotify HiFi experience to Premium users in the future. But we dont have timing details to share yet.

This indicates that the feature is still on the way and has not been completely dropped by the company. However, Yordan changed the status of the thread to Under Consideration which suggests a potential launch is a long way off. This does put the company at risk of losing subscribers given the fact that Apple Music and Amazon Music have added high quality audio in recent years. Spotify is at risk of losing Older Millennials in particular as many of them are more engaged than average in higher quality audio (see Type of Music Streaming Service).

Developing its podcast and audiobook offering

Instead, Spotify is investing in developing the quality of its podcast and audiobook experience. In June 2021, it acquired Podz which is a company that enables people to listen to a sample clip of a podcast to find out if they would be interested in the full version. Spotify began trialling this feature on its platform in March 2022, enabling subscribers to scroll through various podcasts with each one playing a sample clip.

Then in November 2021, Spotify acquired audiobook distributor Findaway. When announcing the acquisition, Spotifys chief research & development officer, Gustav Soderstrom said:

Its Spotifys ambition to be the destination for all things audio both for listeners and creators. The acquisition of Findaway will accelerate Spotifys presence in the audiobook space and will help us more quickly meet that ambition.

The number of consumers listening to audiobooks increased after the first lockdown, from 7% in May 2019 to 12% in July 2020 (see Books and e-books UK, 2021). Despite reducing in 2021 to 9%, the amount of audiobook listeners who have an audiobook subscription stayed at the same level (53% in August 2021 compared to 52% in July 2020). With Spotify entering this space, it will be the go-to option for many people ahead of competitors like Audible given that that they are likely to be already using Spotify for music or podcasts.

Google Stadia continues to take a backseat approach to game streaming

Google suggested in 2021 that it would be taking a different approach to Stadia going forwards with an increased focus on using our technology platform for industry partners (see Video Games and Consoles UK, 2021). This continues to be the case, based on Googles announcements at its Games Developer Summit in January 2022.

In terms of changes it is bringing to the platform, users will no longer need a Stadia account to browse through the library of games and Google is adding Click to Play trials. This enables game developers to create a timeframe of their choosing in which users get a preview of the game for free, again with no account needed. Google said it first started trialling this in October 2021 and will be making it available for all Stadia games in 2022.

However, the main change is known as Immersive Stream for Games, in which Google partners with a company to host cloud games on the latters website. The example demonstrated at the summit was with AT&T; the networks subscribers were able to play Batman: Arkham Knight, requiring nothing except an AT&T phone number.

The fact that people can access cloud gaming without needing any ties to Google Stadia in terms of using their website or having an account underlines Googles backseat approach.

Launch Activity and Innovation

Netflix and Disney+ to launch an ad-based subscription optionsNetflix

In July 2022, Netflix confirmed that it will be bringing an ad-based subscription option to its platform. The ads will be shown in partnership with Microsoft, although a release date has yet to be confirmed at the time of writing. Speaking at Cannes Lions: The International Festival of Creativity in June 2022, Netflixs co-CEO, Ted Sarandos said:

Weve left a big customer segment off the table, which is people who say: Hey, Netflix is too expensive for me and I dont mind advertising. Were adding an ad tier; were not adding ads to Netflix as you know it today. Were adding an ad tier for folks who say Hey, I want a lower price and Ill watch ads.

The new tier is another measure to keep subscribers with Netflix, amid its disappointing financial results during the first quarter of 2022 (see Competitive Strategies). Disney Plus is also launching an ad-tier, although it does not share the same revenue issues.

Disney+

In March 2022, Disney+ said its ad tier will be available in the US later in 2022, with a launch internationally happening in 2023. In terms of its financial results, The Walt Disney Company said that Disney+ had 41.1 million international subscribers in January 2022, marking a 40% YoY increase, as well as 42.9 million subscribers in the US and Canada, marking an 18% YoY increase. Furthermore, monthly revenue per international subscriber was $4.41 in the month, rising 9% YoY and revenue for US and Canadian subscribers was $6.68, rising 15% YoY.

So unlike Netflix, adding an ad-based tier is more about strengthening Disney+s position against its competitors instead of trying to reverse dropping revenue.

Netflixs ad-tier points towards greater differentiation between plans

When discussing the ad tier in its Q2 earnings, Netflix said it is moving towards offering greater differentiation between its tiers. The companys COO and chief product officer, Gregory Peters said:

Our thinking [is] going from our Good, Better, Best model, that has been the core offering weve had, into making that slightly more complicated. Were going to have more discrimination features that would inform what offering consumers ultimately choose to get to. So there will be a little bit more complexity there and ads/no ads will be one of those dimensions.

One of the other differentiators will be the range of content; Sarandos confirmed during the same call that not all of the content from other tiers will be available on the ad-based one:

Today the vast majority of what people watch on Netflix, we can include in the ad-supported tier. So there are some things that dont, that were in conversation with the [film production] studios on. We will clear some additional content but certainly not all of it.

This indicates that not only will there be ads in this tier but also a slightly more limited selection of content. Netflixs exclusive content will still be available, which is likely to be enough to ensure that consumers are still engaged in the ad-based tier.

Many subscribers willing to compromise with ads

61% of digital subscribers would prefer to watch a free video streaming service with adverts than pay a monthly subscription for one with ads (see Attitudes towards Digital Subscriptions). While the Disney+ and Netflix tiers are not expected to be free, they will undercut the current 7.99 and 6.99 entry level tiers the platforms currently offer. With there being a clear market of people who are willing to compromise on ads, the ad-tiers are likely to be popular.

The risk that Netflix faces though is that while there will be take-up of the ad tier by those who cannot afford more expensive tiers, there is also likely to be a section of its current subscriber base that downgrades to the cheaper ad-plan. Those downgrading would be willing to compromise on watching ads if it means they get a cheaper service. However, the overall success of the ad-based tier is likely to outweigh the drop in revenue caused by a section of subscribers downgrading.

PlayStation brings game streaming to PlayStation Plus to compete with Xbox Game Pass

In March 2022, PlayStation announced that it was combining PlayStation Plus and PlayStation Now subscriptions into three tiers of PlayStation Plus. Prior to the change there was one PlayStation Plus subscription which enabled gamers to play online and get access to two additional games per month and one PlayStation Now subscription which enabled gamers to stream older generation PlayStation games on the PS4, PS5 or their computer.

However, in June 2022, it launched PlayStation Plus Essential, PlayStation Plus Extra and PlayStation Plus Premium options. PlayStation Plus Essential has the same features as the original PlayStation Plus at the same price of 6.99 per month or 49.99 per year. PlayStation Plus Extra has these features and a further 400 PS4 and PS5 games to play for 10.99 per month or 83.99 per year. PlayStation Plus Premium has all the aforementioned features and another 340 original PlayStation, PS2, PS3 and PSP games to play, with support for cloud streaming of these titles on the PS4, PS5 or computer. There is also an additional try-before-you-buy feature for some games with this subscription option.

The customers that were subscribed to PlayStation Now were automatically transferred to being PlayStation Plus Premium subscribers at the same price.

Cloud gaming is growing significantly

This change from PlayStation comes in response to the engagement in game streaming and the popularity of Xbox Game Pass. In July 2021, 21% of people who use mobile gaming apps had used a game streaming service in the previous 12 months, rising from 12% in July 2020 (see Mobile Gaming UK, 2021). Furthermore, 46% of those who had used a game streaming service had used Xboxs cloud gaming, which was the highest of the listed platforms.

Apple Fitness+ adds meditation and Pilates sessions

In September 2021, Apple announced new video sessions for its Fitness+ service, adding guided meditations, Pilates and Get Ready for Snow Season.

There are nine themes for the meditation: gratitude, kindness, awareness, creativity, resilience, purpose, focus, calm and wisdom. The sessions last either five, 10 or 20 minutes and there are also available as audio-only recordings on the Apple Watch via the Mindfulness app. The Mindfulness app has replaced the Breathe app on the Apple Watch and also includes the Reflect feature to enable users to reflect on thoughts or actions. Users can also track exercise alongside the meditation sessions to see how their stats compare to when they exercise without meditation.

The Pilates video sessions are 10, 20 or 30 minutes, while the Get Ready for Snow Season provides sessions which are aimed at improving endurance, balance and strength as key skills for snow-based sport such as skiing or snowboarding.

YouTube Premium trials smart download feature

Since January 2022, subscribers for YouTube Premium have been able to try a new smart downloads feature. YouTube has included this feature in YouTube Music since 2019, with the platform automatically downloading music it thinks is of interest to the user. YouTube Premium works in a similar way by downloading ten recommended videos over a Wi-Fi network. The videos refresh weekly and ensure that users have new content to watch on the go.

A smart downloads feature for a music platform like Spotify will engage its users because many work mainly away from home and will be using it on the go (see Type of Music Streaming Service). It is arguably even more valuable on a video-based platform like YouTube Premium, given the larger file size to download. While 5G is growing in terms of take-up, in November 2021, 56% of consumers with mobile contracts did not have it and did not plan on getting it in the next year (see Mobile Network Providers UK, 2022). Therefore, many of the YouTube Premium subscribers will not have a fast enough data connection to consistently seamlessly download videos when on the go, presenting smart downloads as an appealing addition to the platform.

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Faculty of Business and Law

Department of Marketing, Retail and Tourism

Assessment Brief 2022/2023

Unit Name: Marketing Analytics and Decision Making Unit Code: 5X6Z0013

Unit Leader: Dr Erisher Woyo For contact information please see Moodle

Submission Date: See date on Moodle

Feedback Return Date: See date on Moodle

Digital Submission Instructions: Please submit via the Moodle submission point for the unit Feedback Return Information: Please see Moodle for the return date for feedback and marks

Key task and word count (or equivalent):

For this assignment, you need to submit an individual written report (3000 words) that unpacks key marketing and branding insights from the Digital Subscriptions - UK - 2022 - Market Research Report (oclc.org).

Further guidance about writing this assessment will be provided during lectures and seminars.

Unit Learning Outcomes:

Critically evaluate the models theories and frameworks concerned with marketing analytics in support of strategic marketing decision making.

Create suitable metrics and performance indicators for a range of marketing purposes.

Analyse performance against key metrics and indicators, within the organisation, over time, against competitors and in light of the external environment.

This assessment will contribute to the achievement of the following Programme Learning Outcomes:

Identify and interrogate relevant data and literature sources using methods appropriate to level of study and to discipline.

Apply theory to discussion and analysis

4.1.1 Identify and explain professional and commercial/corporate issues

4.1.2 Critically evaluate professional and commercial/corporate issues

4.1.3 Critically reflect upon own development as a current or future professional

4.2.1 Identify and explain debates in their global and/or international context

4.2.2 Critically discuss the global and/or international context

Assignment Details and Instructions

For this assignment, you need to submit an individual industry written report (3000 words) that unpacks key marketing and branding insights from the Digital Subscriptions - UK - 2022 - Market Research Report (oclc.org).

The report that forms the basis of this assessment is about Digital Subscriptions in the UK. To attempt this assessment, please read the Digital Subscriptions UK Report (either using the embedded link [Digital Subscriptions - UK - 2022 - Market Research Report (oclc.org)], or a separate file that you will find on Moodle under the assessment information tab). The data that was used to compile this report is also shared, and you may need to interactive with it to enhance your report.

Key issues that are covered in the Report

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, Consumer Technology Analyst

Type of digital subscription that consumers have, including video streaming, music streaming, game streaming, newspapers and magazines, e-books and more.

Which video streaming and audio streaming services people are subscribed to?

Which digital subscriptions people 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.

You are employed as an in-house Marketing Analyst for Consulting Company in Manchester. You have been approached by the Digital Subscriptions Industry. They are requesting you that you evaluate the secondary market research data that has been published on the state of Digital Subscriptions in the UK in 2022. Critique and submit your summarised findings through a written individual industry dynamics report. Your submission should include but not limited to:

A TITLE PAGE with your name, student number and title of your assignment

EXECUTIVE SUMMARY- An executive summary should include a summary of the report, highlight key marketing and branding insights that the report and the data highlighted.

INTRODUCTION. Provide a summary of what is contained in your report. This is a brief section of the report that is designed to tell the reader what the report covers. In this section, also comment on the suitability of the source of data you are analysing or the credibility of the data, where the data was collected from, who was sampled, what sought of key questions were asked in during data collection, how big was the sample, is the data valid?

SEGMENTATION ANALYSIS

Identification of segments - Determine the 3-4 distinct segments based on the data contained in the UK Digital Subscription Market Report and data. Describe each of the 3-4 segments that you would have chosen for analysis, capturing the essence of what makes it unique.

Segmentation attractiveness Based on the report (and the data), cancellations of digital subscriptions is a major issue for the UK due to cost-of-living crisis. Critique the attractiveness of the 3-4 market segments and the brands you have identified for analysis. Provide a rating of which segment is number 1, 2, 3 etc. Support your reasoning using a range of key marketing performance indicators. The idea is to show if marketing, and advertising campaigns are being effective or not in each of the segments identified. What can we count on based on the report, and/or data?

Consumer behaviour Explain consumer characteristics (psychographics of buying behaviour) that influences the attitudes of consumers towards digital subscriptions in the UK in each of the segment you have identified. These aspects must be fully linked and supported with theory. You may check out on question 6 in the data file for more insights.

COMPETITIVE DYNAMICS

Competitive landscape: Do a competitive landscape analysis of the top 5 players in the Digital Subscriptions Market in the UK. What are their unique selling propositions? USPs, identify the USPs of the top five players, which of these brands are better suited for the segments that you have identified. Rate the strength of the UK Digital Subscription brands and show the segment through which these brands are best positioned. For reach segment propose which of these 5 players are better suited to take first, second spot etc. This needs to be directly linked to the Digital Subscriptions - UK - 2022: Competitive Strategies and data that has been provided for this assessment.

Critique a range of strategies that are being proposed by various competitors of the Digital brands in the UK and show if the strategies are suitable for each identified market segment. Show which marketing key performance indicators will be affected.

Managing sustainable competitive advantage Review the performance of the top 5 Digital Subscription Brands in 2022 as highlighted in the report. Demonstrate if the brands have competitive advantage that could be sustained in each of the segments you would have identified? Explain using relevant theories and models the approaches and processes being implemented by Digital Subscription brands to manage sustainable competitive advantage? Highlight the existing sustainable competitive advantages of the Digital Subscription brands in the UK? What makes these Digital Subscriptions to win now? What makes the Digital Subscription brands to win in the future? The focus can be on branding, innovation and relationship marketing strategies being employed.

CONCLUSIONS AND RECOMMENDATIONS

Evaluation of alternatives (New segments): Given the needs that Digital Brands in the UK can (and cannot) fulfil, are the top 5 identified brands in the Report positioned to compete strongly in these new segments being proposed? Are the proposed new segments likely to disrupt the segments you have identified earlier? If yes, how? If not, why not?

Recommendations As a Marketing Analyst, make industry level recommendations of how the Digital Subscription brands in the UK can position themselves even more strongly in the segments you have identified above, regardless of the cost-of-living crisis? Would innovative competitive strategies like ad-based subscription be something the Digital Subscriptions market should invest? Why? Why not?

A reference list of all used resources presented in proper MMU Harvard style.

There will be opportunities for formative feedback within the teaching schedule and support through one-to-one sessions.

You will need to submit a copy of your individual written case study report via Turnitin on Moodle.

Please include all outputs in the appendix and put only necessary analysis output in the

text. Seminars are dedicated to work on the assignment.

References.

You will need to reference any evidence used in your written research proposal, and you are required to include a full reference list at the end of the research proposal. The references for this assessment must be those that were published in the last five years and the dominant use of journal articles is preferred. In addition to existing theory, you should also incorporate aspects such as current news articles and case studies to illustrate situational context and awareness Please do stay away from sources with no dates in this Unit.

Please only include those sources you cite in your written proposals. Students should follow the referencing style of MMU Harvard, with advice found here: https://www.mmu.ac.uk/library/referencing-and-study-support/referencing/mmu-harvard.

Academic Integrity, Academic Misconduct and Plagiarism

Academic Integrity is about engaging in good academic practice. It means being honest and transparent,and demonstrating rigour and accuracy in your work. This can include the proper citation and referencing of the sources of your ideas and information, ensuring that you are using appropriate research methods,or checking that your work is free of errors.

Additional information, video tutorials and guides to support good academic practice and maintain Academic Integrity in your assignments can be found on the Academic Integrity area of theAcademic and Study Skills page on Moodle.

Academic Misconduct is any action that could give you an unfair advantage in coursework, exams, or any other assessed work, which could lead to undermining the academic standards of the University. This includes practices such as plagiarism, self-plagiarism, collusion, contract cheating or falsification of data. Full details of the Manchester Metropolitan University guidelines for Academic Misconduct and definitions of terms can be found here.

University Stepped Marking Guidelines

Please note stepped marking is applied as below:

Mark UG Classification

95 - 100% First

90% 85% 80% 75% 72% 68% 2.1

65% 62% 58% 2.2

55% 52% 48% Third

45% 42% 38% Fail

35% 32% 28% 25% 22% 18% Very poor Fail

15% 12% 8% 5% 2% 0% Non submission

Assessment Marking Rubric

In marking this assessment, the marking rubric below will be applied, and all aspects of the unit learning outcomes and professional skills (PLOS) will be evident.

Assessment Descriptor FAIL

0-19% FAIL

20-29% FAIL

30-39% PASS

40-49% GOOD

50-59% VERY GOOD

60-69% EXCELLENT

70-85% OUTSTANDING

86-100%

Essential components of the report (Submission includes the answers to the discussion questions, discussion of marketing problems, segmentation analysis, competitive landscape, conclusions and recommendations)

ULO 1, ULO2, PLO 1.1.1, 1.1.2a, 4.1.3, 4.2.1, 4.2.2 Incomplete submission and questions were not answered. Inadequate descriptions and discussions about the Digital subscriptions marketing problems. Inadequate thoughts on how segmentation, and competitive landscape analytics. Response is purely descriptive, and/or does not address the question in ways that could help managers to make evidence-based and objective decisions.

Several questions are not answered. No attempt to link the key aspects of the analytics asked in the assessment. Inadequate descriptions about the Digital subscriptions marketing problems. Inadequate thoughts on segmentation, and competitive landscape analytics. Response is purely descriptive, and/or does not address the question in ways that could help managers to make evidence-based and objective decisions. Makes no reference to marketing data provided.

Some questions are not answered AND/OR the write up indicates that the student did not spend time investigating and interpreting the report and/or the data. Some questions do not show clear linkages between segmentation, positioning, targeting and competitive advantage. Limited descriptions of marketing problems in each discussion point of the report. Limited thoughts on segmentation, and competitive landscape analytics. Response is purely descriptive, and/or does not address the question in ways that could help managers to make evidence-based and objective decisions. Makes no reference to marketing data provided. All the discussion components of the industry report are answered and reflect a limited level of marketing analytics knowledge and effort indicative of time spent investigating and interpreting the marketing research report and/or data. Answers include a commentary interpreting the data. Brief descriptions about the digital subscriptions marketing problem. Brief thoughts on how segmentation, targeting, positioning and competitive landscape analytics. Response shows weak linking of solutions to problems and makes little reference to the marketing data provided. All the discussion components of the industry report are answered and reflect a good level of marketing analytics knowledge and effort indicative of time spent investigating and interpreting the marketing research report and/or data. Answers include a commentary interpreting the data. Good, detailed descriptions about marketing problems. Good indepth thoughts on segmentation, targeting, positioning and competitive landscape analytics. Response shows good analysis and linking of solutions to problems, as well as some references to the marketing data that was provided. All the discussion components of the industry report are answered and reflect a very good level of marketing analytics knowledge and effort indicative of time spent investigating and interpreting the marketing research report and/or data. Answers include a commentary interpreting the data. Very good descriptions about the Digital Subscriptions marketing problems. Very good indepth thoughts on segmentation, targeting, positioning and competitive landscape analytics. Response shows very good analysis and linking of solutions to problems, as well as some references to the marketing data that was provided. All the discussion components of the industry report are answered and reflect an excellent level of marketing analytics knowledge and effort indicative of time spent investigating and interpreting the marketing research report and/or data. Answers include a commentary interpreting the data. Excellent descriptions of the marketing problems. Excellent thoughts on segmentation, targeting, positioning and competitive landscape analytics. Response shows critical thinking and clear linking of solutions to problems, as well as ample relevant references to the marketing data. In addition to the lower grade band, makes original connections between theory and practice. Insightful descriptions about the marketing problems for each discussion element of the report. Insightful thoughts marketing analytics and decision-making. Response shows critical thinking and ability to argue convincingly for recommended solutions, considering opposing viewpoints, and includes ample relevant references to the marketing data,

Use of core marketing analytics theory, knowledge, and models (coherence, organisation, linking of data to marketing theory; use of core knowledge/models in marketing analytics and decision making)

ULO1, ULO2, ULO3, PLO 1.1.1, 1.1.2a, 3.1.1, 4.1.1, 4.1.2, 4.1.3, 4.2.1, 4.2.2 Weak report that does not provide any useful marketing insights. Context and issues not explained, inappropriate, extremely limited. Little/no use of core knowledge areas in analysis of the organisation marketing context. Inappropriate language. Unacceptable standard of grammar, spelling, presentation.

Unstructured/

disorganised. Careless presentation.

No/extremely poor cross-referencing

Extremely weak report that does not provide marketing analytics insights that could be used for decision making by the industry. Inappropriate language. Unacceptable standard of grammar, spelling, presentation.

Unstructured/

disorganised. Careless presentation.

No/extremely poor cross-referencing

Weak report that does little to bring marketing insights to the fore and influence decision-making. There is no attempt to understand marketing data in the report and how it is linked with core marketing analytics knowledge/models. Some inappropriate writing style for marketing analytics report. Still noticeable errors in spelling and grammar. Some structure and logic but still noticeable gaps.

Insufficient care in presentation.

Demonstrates understands some relevant core knowledge/models which has been applied to data analysed. Still descriptive rather than used in analysing and formulation of strategic decisions. context. Acceptable use of marketing analytics language and standard of spelling and grammar. Some lack of conciseness. Structure and flow sufficient to convey clarity in argument.

Presentation consistent but basic. Demonstrates ability to critically apply data to core marketing knowledge/models. Appropriate use of language for marketing analytics report. Clear, concise. Very occasional and minor spelling and grammar errors. Coherent and logical. Uses commonly accepted conventions for presentation. Very good breadth and depth of core knowledge/models linked to the data that were analysed. Competent standard of writing for business purposes in all areas. Demonstrates good knowledge of use of word processing tools. Excellent consideration of relevant core knowledge/models in rigorous critical analysis of the data. In addition to lower grade band may correctly use some sophisticated vocabulary relevant to theory and practice area. No noticeable errors in writing or presentation. In addition to the lower grade band, makes original connections between theory and practice. In addition to lower grade band may demonstrate imaginative approach to enhancing communication and presentation. Professional standard report.

Quality of conclusions and recommendations (managerial implications, link between conclusions, data, and theory; actionable recommendations for the industry)

ULO1, ULO2, PLO1.1.1, 1.1.2a, 3.1.1, 3.1.2, 4.1.1, 4.1.2, 4.1.3, 4.2.1, 4.2.2 None or extremely limited conclusions and recommendations with weak connection to discussion and the data. Conclusions are weak. Recommendations not useful for managers as to how and what needs improvement based on the marketing analytics from the data. There is no flow in terms of the conclusions and the recommendations. There is a weak attempt to provide conclusions and recommendations to the organisation. Conclusions are not linked to the data that was analysed. There is a mismatch in that regard. Partial identification of conclusions/recommendations. May still be unsupported/or arguments not fully developed to conclusion. Conclusions may still not be linked to the data that were analysed. Identification of good and sensible conclusions/ recommendation. Logically supported by data analysis, evaluation, and evidence. Recommendations are somehow specific, action-oriented suggestion with limited clarity in terms of improvements. Conclusions are very good and relevant. Linked with the data that were analysed in the brief. Recommendations are very specific, action-oriented suggestion with clear signposting of how managers could improve the situation. In addition to lower grade band, critically considers strengths/limitation of conclusions and complexity of implications for strategic marketing and effective decision-making context.

Conclusions are relevant and excellently portray critical strategic marketing insights. Linked excellently with the data that was analysed Recommendations are specific, action-oriented suggestion with excellent clarity the improvements that managers need to make. analysis. In addition to lower grade band, demonstrates originality and creativity in strategic marketing thinking. Conclusions are relevant and clearly portray critical strategic marketing insights. Recommendations are specific, action-oriented suggestion with clear improvements on how to understand segmentation and competition analysis. Conclusions/recommendations flow logically, with justification and supporting references.