Streaming growth strategies must not rely on consumer complacency

Opinion 

Services like Spotify and Netflix need to be more than just a seamless convenience and one-click utility.

French brand Deezer became the latest music streaming platform to increase its monthly subscription charge last week. In fact, it is its second rise in under 12 months, with Spotify, Apple Music, Amazon Music Unlimited and YouTube Music Premium also hiking prices during this period.

While their increases are relatively small, subscription video-on-demand services have been punchier with their raids on our pockets. After its password crackdown, the top monthly charge for Netflix, for example, can be as high as £25.97, compared with a maximum of £11.99 as recently as 2020.

Banking on convenience

Across the board, these price rises are blamed on increasing costs. But they also hint at a confidence in the indispensable role they believe they play in audiences’ lives.

Cue the ongoing cost-of-living crisis, which means many of us are still trying to cut our spending. There’s now a sort of subscription Russian roulette being played out as consumers, especially younger ones, choose what to shoot and kill from their monthly outgoings, and what to keep.

It won’t last forever, but once an audience has discovered that these platforms are really not indispensable it makes it hard to win them back.

The beige-ification of content

Along with higher charges, it’s impossible not to notice there’s been a shift in the content they want us to consume.

These platforms are all driven by algorithms which focus on serving content ‘for us’, supposedly curated to suit our tastes and whims. A sort of special sauce which got so many of us hooked in the first place. Yet as a result, in spite of the limitless possibilities and the longest of long tails, we’re watching the same shows and listening to the same artists.

Meanwhile, with the broadcast industry, there’s a huge disruptor to the whole streaming market, in the form of the attention deficit caused by the ultimate apex predator: TikTok.

TikTok has an almost limitless resource (us, the audience) which means it doesn’t have to fork out for expensive content.

And its ‘for you’ algorithm means that the content it does serve is variety personified. I like marketing professor Scott Galloway’s comparison: “Watching Netflix is like going to Universal Studios Florida because you loved Disney,” he says. “Watching TikTok is going on safari.”

Streaming giants have done a great job of getting us hooked, but now they are the mainstream, they need to keep us happy. That means not relying on price rises and decreasing variety to drive growth.

So what’s the answer?

In the world of music, new artists are succeeding most by overtly standing on the shoulders of their predecessors. Audiences and fans might say they want to discover, and seek out ‘new’, but this is not entirely true. In fact, they want new music which sounds like the stuff already in their archive playlists.

This sort of long-tail anomaly — unlimited choice but where everything sounds the same — means they’ll become a fan of a new singer/songwriter if they sound like the old one, but they can’t stray too far from the original.

Take Olivia Rodrigo, an incredible artist who has triple number ones on the coveted Artist 100, Hot 100 & Billboard 200 Charts for the first time. Her beautiful Vampire song makes more than a little nod to Lorde’s global hit Royal, but also more recent music by Taylor Swift and Miley Cyrus. Reddit threads are buzzing with this exact conversation, where fans are actively seeking out the similarities (with joy!) when comparing the song to old tunes they loved, too.

This is no criticism of the new work, and similarities can be subjective — it’s just the way our brains and behaviours are currently pre-programmed to consume. We seek the same. We’re sounding the same, looking the same, doing the same, acting the same.

And here lies challenge — and opportunity. Deezer, Spotify, Netflix and the like need to see themselves now as something more than just a seamless convenience and one-click utility.

We won’t pay more and more to just become an increasingly beige part of the audience. To prevent themselves going extinct, they need to somehow imbue their offering with the unexpected, and allow true variety. It might feel unforeseen — but it could just be electrifying.

James Kirkham is CEO and founder of marketing/entertainment agency Iconic and former global head of social at Publicis Groupe ad agency Leo Burnett.

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