Consumers continue to shift their video consumption away from traditional TV screens to tablets and mobile phones. That’s why TV providers need to more aggressively redefine the TV package to remain relevant to today’s consumers and aligned with consumers’ evolving viewing habits. Specifically, they need to leverage their large base of existing consumers and content relationships to aggregate video products with relevant, personalized content available anyplace, anytime, via any device. Doing so will mean TV providers have to fundamentally switch their mindsets. Instead of playing defense, they need to go on offense, investing in analytics to understand who their consumers are and innovatively serving up what they really want to watch. The result will be more engaged and loyal consumers, lower costs, and bigger profits.
Consumers’ video viewing habits are changing quickly and dramatically:
Total video consumption is expected to increase at a 0.8 percent CAGR from 2016 to 2020
But consumers are shifting away from traditional TV screens and are viewing much more content on tablets and mobile phones.
The proportion of time viewers consume over these “second screens” is expected to grow 13 percent by 2020, helped by a 5.8 percent boost in connected devices.
This shift is having a dramatic impact on traditional TV:
Leading companies lost nearly 700,000 subscribers in the second quarter of 2016 and TV providers continue to reach record lows.
What’s the answer? Go on offense. TV providers should stop playing defense to protect their legacy business. Instead, they need to adopt proactive strategies to capitalize on changing TV viewing habits and technology advances and remain competitive.
A dramatic shift
Consumers continue to shift their video consumption away from traditional TV screens to tablets and mobile phones.
“Playing offense” requires taking aim at price and content, the two key drivers of viewership. Three actions are key to influencing both of these factors:
Reduce pricing to increase profits. Consumers continue to watch more video, but they concentrate on a smaller range of content. Providers need to abandon their “more channels for more money” legacy strategy and offer smaller packages tailored to what people watch.
Do more with anytime, anywhere viewing. Time- and place-shifted viewing continues to grow in popularity among consumers. Providers need to continually revisit their feature roadmap to make sure they are delivering a richer in-home and out-of-home experience
Provide cross-platform content and recommendations. Consumers expect TV providers to carry content from OTT providers. Providers should aggregate content across disparate sources and platforms and deliver very specific, personalized and timely content suggestions across all content.