How to win new subscribers in the competitive world of Media and Cable
4 Minute Read
According to PWC’s Consumer Insights Survey 2020, 36% of people surveyed are spending more on entertainment and media since the pandemic began. It’s not just that they’re spending more money on media, 60% confirmed their media consumption had also increased, in particular relating to streaming services and video. This is no surprise given the number of people staying home and working remotely. This has led to many seeking to maintain a connection to the outside world and using online media as a form of distraction and entertainment.
The increased consumption has been matched by fierce competition. According to Grand View Research, the global video streaming market was valued at USD50.11 billion in 2020. Conservative estimates put growth at 21% over the next 3 years. Statistica research projects that the video-on-demand segment will reach a value of USD85.88 billion by the end of 2021 with an annual growth rate of just over 10%. Most media and cable companies are actively expanding their offerings to take advantage of this growth potential. However, their success will largely depend on how well they’re able to deliver relevant, engaging and personalized digital experiences to subscribers.
Why customer experience is the key to driving subscriber growth
In an industry where the media and content are relatively similar, the one clear area that media and cable providers can compete on, is the digital customer experience. The experience starts the moment a potential new subscriber is doing research on a service, all the way to selecting the next movie to watch. When subscribers are looking for entertainment they first want to find the services that deliver the content and value they seek. Media and cable providers need to ensure they provide a frictionless and efficient shopping experience. The goal has to be to help the potential subscriber select the services and options that meet their needs. Once they become a subscriber, media and cable providers need to create an experience that eliminates the potential for a customer to search endlessly before finding something that appeals to them. Recommendations based on previous viewing, latest releases or most popular ratings are a step in the right direction in creating more personalized experiences.
Netflix has earned a reputation for successfully winning subscribers through creating personalized customer experiences. Other service providers need to get innovative if they wish to compete and gain market share. Leveraging technologies such as artificial intelligence (AI) can help reach more potential subscribers shopping for a new service and then serve up targeted, relevant recommendations once they become a customer. More importantly AI-driven optimizations can continually monitor user behavior for changes and adapt accordingly, resulting in a continuous optimization of the customer experience.
How AI-driven optimization can wow customers
The power of AI is that it gives companies the opportunity to experiment with a broad range of ideas and quickly see which of those ideas are getting the best response from real customers. Optimization further evolves by adding to the top performing ideas, removing the low performers and constantly making more changes aimed at improving customer experiences. AI-driven optimization is also able to automatically detect user clusters so that experiences can become more targeted based on individualized preferences. This means an optimization has to go beyond simply determining the highest average. Instead it has to serve the best experience to each customer, every time.
Personalization done differently
While the general trend is towards personalization, there is also a concern about privacy. How much information do companies really need in order to deliver relevant experiences? Without using personally identifiable information (PII), there is a way to serve up more relevant experiences using data such as location, device type, time of day, date, pages visited and more. When combined with more personal data such as demographics, loyalty information, and previous history, cable and media providers can get even more targeted based on identified preferences (driven by AI). The outcome can get media and cable providers much closer to delivering experiences that individual subscribers are looking for.
When done properly an AI-driven optimization solution has several benefits: It can address security concerns and compliance mandates and enables media and cable providers to retain full control over their customer data. The solution can also incorporate additional data sources over time and as required which can drive more refined insights. As media and cable providers start to leverage more PII, they should use a solution that protects user privacy by leveraging data hashing to pass opaque values. This approach ensures that a security audit will go smoothly and quickly.
For media and cable providers, AI can provide a solution that meets the growing expectations for personalized digital experiences. AI can start to add value immediately by increasing the effectiveness of specific promotions and generating lift. This gets even more valuable when combined with manual targeting data based on known trends. It optimizes using ideation at AI-scale to identify the best performing ideas and combinations. The end goal is maximizing the value of each idea and using AI automated targeting optimization to drive down to smaller clusters. This is what will generate lift in key markets, help cable and media providers win more subscribers and serve up more personalized experiences that can drive customer loyalty.