Post on 10-May-2015
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Subscription Services in the Context of Market Trends
Q1 2014
Jonathan StolperMay 2014
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Latest Nielsen Research:
• Streaming Music Subscription Services
• Streaming TV and Movies Subscription Services
• Book Subscription Services
.
Book Subscription Services Agenda
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STREAMING MUSIC SUBSCRIPTION SERVICES
How have subscription services faired in other entertainment sectors?
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Methodology/Data Sources
Data on Music Subscriptions:
Derived from NetView panel to analyze streaming behavior
• A representative panel of 220,000 US Internet users
• tracks consumer usage across all web sites and apps at work at home and work
• Delivers high-quality audience data and analytics that are based on observed behaviours at an individual user level (age 2+)
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Total Music Streams
Nielsen Entertainment– BDS Streaming Data Q1-’12 – Q3-’13Longitudinal, non-video provider data: Cricket, MediaNet, Rdio, Rhapsody, Slacker, Spotify
Q1-2012 Q2-2012 Q3-2012 Q4-2012 Q1-2013 Q2-2013 Q3-20131,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
Total Streams: Overall GrowthMM Streams
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Streaming Accounts for a Fifth of US Music Revenues% of music revenues coming from streaming services
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Sep-11
Oct-11
Nov-11
Dec-11
Jan-12
Feb-12
Mar-12
Apr-12
May-12
Jun-12
Jul-1
2
Aug-12
Sep-12
Oct-12
Nov-12
Dec-12
Jan-13
Feb-13
Mar-13
Apr-13
May-13
Jun-13
Jul-1
3
Aug-13
Sep-13
Oct-13
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
Access To Sites and Services With Pirated Content Is Decreasing…
Based on all who have accessed an illegal site or serviceSource: Nielsen US NetView Panel Home and Work – Sept ‘11 – Oct ‘13
US internet users access sites and services with illegitimate
content (10%)
22mUsers (,000’s) Reach
Sep-11
Oct-11
Nov-11
Dec-11
Jan-12
Feb-12
Mar-12
Apr-12
May-12
Jun-12
Jul-1
2
Aug-12
Sep-12
Oct-12
Nov-12
Dec-12
Jan-13
Feb-13
Mar-13
Apr-13
May-13
Jun-13
Jul-1
3
Aug-13
Sep-13
Oct-13
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
Visitation to Pirate Sites and Services - Audience Size
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Who Are Music Streamers?
Key Findings
• Younger adults (18-34) are more likely to be streamers and also
stream the most
• Heavy streamers lean slightly male, moderate streamers slightly
female
• Music streaming has not spread to the less tech-savvy
• Streamers are less likely to pirate content
• African Americans and Hispanics are more likely than the average
internet user to stream music
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STREAMING TV & MOVIE SUBSCRIPTION SERVICES
How have subscription services faired in other entertainment sectors?
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Methodology/Data Sources
Data on Movie/TV Subscriptions:
• Nielsen Total Home Entertainment Panel; Full Year 2013
• 3,000 households active per quarter
• Record all Movie and TV transactions across all retailers, devices, and platforms
• A longitudinal view, tracking panelists behavior over time
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Streaming TV & Movies Subscription Services Are On the Rise Especially in last 9-Months
Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 20140.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
19.9% 19.3% 18.2% 19.2%21.2%
18.7%
22.7%25.4%
HH Penetration
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Streaming Is Primarily Used for Television
Types of Content: % of Streams % of Subscription Streams
Television 81.0% 80.3%
Movies 19.0% 19.7%
Action/Adventure 4.8% 5.4%
Comedy 2.4% 2.6%
Drama 3.5% 4.2%
Family 3.0% 3.0%
SciFi 1.0% 1.0%
Horror 1.9% 1.3%
Source: Nielsen Total Home Entertainment Panel; Full Year 2013
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13Nielsen Total Market Panel: 2012:Q2-2013:Q2. Transactional Movie Spend By SVOD vs. Non-SVOD Households
SVOD HHs NON SVOD HHs$0
$5
$10
$15
$20
$25
$30
$35
$40
Avg Quarterly Spend Q
uart
erly
HH
Spe
nd
Streamers Spend Less on Transactional Content
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14Nielsen Total Market Panel: 2012:Q2-2013:Q2. Transactional Movie Spend for sVOD Adopting HHs.
Included: Longitudinal sVOD adopters with at least 2 months in the panel prior both pre and post adoption.
Before After$0
$2
$4
$6
$8
$10
$12
$14
$16
$18
$16.44
$8.46
AVG/HH Spend sVOD Adoptersn=749
Mon
thly
HH
Spe
nd
NetflixHulu+
Amazon Prime Redbox Instant
But Make Up For It In Subscription Costs
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How Might All Of This Impact Book Subscriptions….
• Don’t expect rapid take-off….growth is incremental
• Early adopters are more likely to be…
• Young
• Male
• Tech-savvy
• A reduction in illegal behaviors
• First to adopt tend to be heavier buyers…
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BOOK SUBSCRIPTION SERVICES
So how are book subscription services playing out in the book industry?
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Books & Consumers Methodology
US & UK consumer market tracker studies providing demographic and psychographic information ontoday’s book buyer: 6,000 book buyers per month in US drawn from a national representative sample• 75 questions about book and ebook purchasing• ~72,000 book consumers annually• ~200,000 book purchases annually
Deliverables: Annual Reviews Industry Standard Quarterly Reports Genre Landscapes – quarterly GenreProfiles – annual Adhoc analysis Return to sample Syndicated Deep-Dives e.g. Children’s, Ebook Consumers, Travel
Developments: B&C lite and dashboard solution Retailers, AGFA, device manufacturers Segmentation and clustering studies Forecasting
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Books & Consumers Coverage
Book buyers Books bought
What?
Where?
When?
Demographics
Media usage
Leisure habitsWhy?
Who for?
Book spend
Sex, age, region, socio-economic, family
Newspapers, magazines, devices, social media
Online, offline, cultural
Publisher, format, genre, author, price, discounting
Channel, retailer
Month, quarter, YTD
Discovery, influences, use
Sex & age, relationship, occasion
Reading attitudes
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Book Buyer Activities in Q1 2014
None of the above
Took out a subscription to read ebooks where you pay a monthly fee to download a number of books (e,.g, via Safari Online, Oyster, etc.)
Read a book in serialized form
Went to an e-bookstore and e-reading platform that lets you pay only for what you read
Subscribed to AmazonPrime and downloaded a Kindle book to borrow for free each month from the Kindle Owners' Lending Library
Subscribed to AmazonPrime and downloaded streaming content of movies and/or TV shows with Prime Instant Video
Downloaded a book related 'app' to a device such as a smartphone, tablet, or ereader either free or paid for separately
Went on vacation to a destination significantly far from your home (personal, not business)
Visited a public library either in-person or online
Purchased one or more books (any type, such as, hard cover, paperback, audio, e-book, etc.)
Cooked using recipies
0% 10% 20% 30% 40% 50% 60% 70%
4%
9%
17%
17%
16%
23%
33%
40%
56%
68%
68%
Nielsen Books & Consumers Monthly SurveyRespondent Level Summary (Book Buyers ~6,000 per month)
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Most Popular Subscription Services (of the 9%)
Nielsen Books & Consumers Monthly SurveyRespondent Level Summary (Book Buyers ~6,000 per month)
Other, please specify
24Symbols
Entitle (formerly eReatah)
SkillSoft (Harper Collins)
Scribd
Direct from another publisher
Harlequin
Oyster
Safari Online
AmazonPrime
0% 10% 20% 30% 40% 50% 60% 70% 80%
4%
17%
19%
22%
23%
23%
23%
27%
34%
79%
Q1 2014
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Book Buyer Activities in Q1 2014
None of the above
Took out a subscription to read ebooks where you pay a monthly fee to download a number of books (e,.g, via Safari Online, Oyster, etc.)
Read a book in serialized form
Went to an e-bookstore and e-reading platform that lets you pay only for what you read
Subscribed to AmazonPrime and downloaded a Kindle book to borrow for free each month from the Kindle Owners' Lending Library
Subscribed to AmazonPrime and downloaded streaming content of movies and/or TV shows with Prime Instant Video
Downloaded a book related 'app' to a device such as a smartphone, tablet, or ereader either free or paid for separately
Went on vacation to a destination significantly far from your home (personal, not business)
Visited a public library either in-person or online
Purchased one or more books (any type, such as, hard cover, paperback, audio, e-book, etc.)
Cooked using recipies
0% 10% 20% 30% 40% 50% 60% 70%
4%
5%
17%
17%
16%
23%
33%
40%
56%
68%
68%
Nielsen Books & Consumers Monthly SurveyRespondent Level Summary (Book Buyers ~6,000 per month)
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How Do Subscribers Compare (Gender)?
Nielsen Books & Consumers Monthly SurveyRespondent Level Summary (Book Buyers ~6,000 per month)
Purchased one or more books (any format.)
Visited a public library either in-person or online
Downloaded a book related 'app' to a device such as a smartphone, tablet, or ereader either free or paid for separately
Went to an e-bookstore and e-reading platform that lets you pay only for what you read
Subscribed to AmazonPrime and downloaded a Kindle book to borrow for free each month from the Kindle Owners' Lending Library
Subscribed to AmazonPrime and downloaded streaming content of movies and/or TV shows with Prime Instant Video
Took out a subscription to read ebooks where you pay a monthly fee to download a number of books (e,.g, via Safari Online, Oyster, etc.)
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
46.4%
48.7%
52.6%
53.7%
55.7%
56.4%
60.8%
53.6%
51.3%
47.4%
46.3%
44.3%
43.6%
39.2%
Male Female
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How Do Subscription Services Compare?
Nielsen Books & Consumers Monthly SurveyRespondent Level Summary (Book Buyers ~6,000 per month)
Scribd
Safari Online
Oyster
AmazonPrime
0% 20% 40% 60% 80% 100%
61.1%
62.1%
60.4%
60.6%
38.9%
37.9%
39.6%
39.4%
Male Female
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How Do Subscribers Compare (Age)?
Nielsen Books & Consumers Monthly SurveyRespondent Level Summary (Book Buyers ~6,000 per month)
Purchased one or more books (any type, such as, hard cover, paperback, audio, e-book, etc.)
Visited a public library either in-person or online
Downloaded a book related 'app' to a device such as a smartphone, tablet, or ereader either free or paid for separately
Subscribed to AmazonPrime and downloaded streaming content of movies and/or TV shows with Prime Instant Video
Went to an e-bookstore and e-reading platform that lets you pay only for what you read
Subscribed to AmazonPrime and downloaded a Kindle book to borrow for free each month from the Kindle Owners' Lending Library
Took out a subscription to read ebooks where you pay a monthly fee to download a number of books (e,.g, via Safari Online, Oyster, etc.)
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
27.3%
28.1%
36.4%
36.5%
36.8%
37.4%
40.5%
27.5%
28.4%
32.5%
34.9%
35.0%
36.8%
40.0%
13-17 Yrs 18-29 Yrs 30-44 Yrs 45-54 Yrs 55-64 Yrs 65+ Yrs
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How do Subscription Services Compare?
Nielsen Books & Consumers Monthly SurveyRespondent Level Summary (Book Buyers ~6,000 per month)
Scribd
Safari Online
Oyster
AmazonPrime
0% 20% 40% 60% 80% 100%
7.6%
11.2%
9.4%
8.3%
39.7%
41.8%
42.5%
40.8%
49.6%
42.2%
46.2%
42.9%
3.1%
3.0%
1.9%
4.1%
0.0%
1.3%
0.0%
2.5%
0.0%
0.4%
0.0%
1.4%
13-17 Yrs 18-29 Yrs 30-44 Yrs 45-54 Yrs 55-64 Yrs 65+ Yrs
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How do Subscribers Compare (Income)?
Nielsen Books & Consumers Monthly SurveyRespondent Level Summary (Book Buyers ~6,000 per month)
0%
20%
40%
60%
80%
100%
13.4% 14.0% 15.1%20.4%
17.0% 17.7% 17.9%
9.5% 10.0% 10.8% 13.4% 12.6% 12.6% 11.6%
4.4% 5.0% 5.9% 7.4% 6.3% 7.1% 6.0% $150,000 and over
$100,000-$149,999
$75,000-$99,999
$50,000-$74,999
$35,000-$49,999
$25,000-$34,999
$15,000-$24,999
Under $15,000
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How do Subscription Services Compare?
Nielsen Books & Consumers Monthly SurveyRespondent Level Summary (Book Buyers ~6,000 per month)
AmazonPrime Oyster Safari Online Scribd0%
20%
40%
60%
80%
100%
5.5% 4.7% 6.5% 7.6%4.8% 3.8% 2.6%
5.3%
9.9%7.5% 8.6% 3.8%
13.1%
11.3%14.7%
10.7%
24.0%
25.5%
26.3%
21.4%
21.2%
17.9%
17.7%
24.4%
14.7%
18.9%15.1% 17.6%
6.7% 10.4% 8.6% 9.1%$150,000 and over
$100,000-$149,000
$75,000-$99,999
$50,000-$74,999
$35,000-$49,999
$25,000-$34,999
$15,000-$24,999
Under $15,000
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Subscribers Continue to Shop for Books in Other Outlets
Non-Subscribers Subscribers $-
$20.00
$40.00
$60.00
$80.00
$100.00
$120.00
$140.00
$60.80
$105.80
$10.00
Monthly FeeBook Transactions
4.9 books
7.7 books
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Subscribers Are More Likely to Plan Book Acquisition
Yes No0%
10%20%30%40%50%60%70%80%90%
100%
51%36%
22%
23%
12%
17%
15%25%
Not Planned, Impulse purchase
Planned a book at that specific time, but not specific bk
Planned this specific book, but not at that specific time
Planned this specific book at that specific time
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Book Subscribers Are More Likely to Have Also Pirated Books in the Last 6-months
0%
5%
10%
15%
20%
25%20%
17%15% 14%
7%5%
2% 3%
YesNo
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In Summary
• Book subscription people are higher book buyers than the norm.
• Mostly Men
• Younger
• Wealthier
• Their book purchases are less “impulsive” than the norm
• They continue to maintain other book purchase habits
• Are more likely to have pirated books in the past – need further study to see if subscription service have decreased their pirated activities
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Ideas For Further Study…
• Adoption, Loyalty, Substitution
• Content, Selection
• Attracting a Wider Audience
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