The steady rise in subscription services has transformed how consumers watch content. Over the past four years, our Kids and the Screen study has observed a steady upwards trend of Subscription Video On Demand (SVOD) content. Whilst traditional viewing methods such as TV and DVD have seen a decreasing share of viewing time. With summer holidays approaching and many kids likely to be staying at home, we deep dive into what subscription services they have access to.

The increased role of SVOD

The use of SVOD has doubled over the last two years. As families were locked down and forced to stay at home during 2020, SVOD grew from strength to strength. Our in-house research study, Little Voices, found that 38% of parents aged 2-12 reported increasing their subscription services during the pandemic. The most popular subscription services being TV (79%), music (38%) and gaming (31%).

Of those that have TV subscriptions, Disney Plus (57%), Netflix (90%) and Amazon Prime (50%) came out on top with the majority of our audience subscribing to more than one platform. Disney + grew massively in its first year and gained 100 million subscribers in 16 months (1), an achievement that took Netflix 10 years (2). Until recently, Netflix had dominated the SVOD viewing space. However, the launch of Disney + at the start of the pandemic was positioned perfectly, giving viewers new and exciting content– a move that turned the SVOD landscape on its head. However, our Kids and the Screen proprietary study suggests that Disney+ and Netflix could co-exist in the SVOD landscape as they both fulfil different consumer needs. For example, children are more likely to go to Netflix for individual episode viewing whilst families are likely to go to Disney + for the at home cinema experience.

Parents act as the gateway and will determine which SVOD platforms children have access to this summer. Our latest insights reveal that the SVOD platforms parents subscribe to are also the platforms kids watch content on with many kids accessing subscription services through an account with someone in the family.  Kids are most likely to turn to SVOD for cartoons (42%) and preschool (25%) content. Suggesting that it’s easy to watch content that is drawing people to SVOD.

The battle of SVOD

As the SVOD market continues to grow, at what point will it reach saturation? Competition between services is growing and the market faces a serious challenge from the wealth of options at consumer disposal. The number of people subscribing to SVOD has not significantly changed over the past year and it is predicted that the number of new subscribers will continue to level off. This is particularly apparent in markets such as the UK where both local and international players are competing for space in an increasingly saturated SVOD market.  This suggests that families are becoming overwhelmed by subscriptions and expense.

Looking towards the future, brands should be aware that their portion of the subscription pie may be smaller and less profitable and only the strongest will survive. Exclusivity of content is therefore increasingly critical. The streaming giant Netflix remain ahead of the competition and are expanding into new markets such as ecommerce (3) and gaming (4) to stay on top amid fierce competition. This is a move that we will likely see many of its competitors making in the not so far future.

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