According to Deloitte, nearly two years into the pandemic, media companies face stiff competition for consumer loyalty from more interactive social media and gaming companies.

Deloitte Digital Media Trends “Fall Pulse Survey” reveals 84% of consumers are spending more time on online entertainment at home, compared with in-person entertainment outside the home.

The continued uncertainty of the pandemic, and the spread of the Delta variant through the summer months kept consumers close to their households and plugged into online experiences. At the start of 2021, Deloitte launched its 15th annual “Digital Media Trends” survey which found that consumers had more time for home entertainment while streaming video providers were competing for subscribers against myriad entertainment options.

In August of 2021, Deloitte fielded another survey of US consumers, which revealed that changes shaped by the pandemic have continued and it’s becoming clear a return to the “old normal” is not imminent. For streaming video providers, keeping subscribers is harder than ever as people — especially younger generations — are managing costs by adopting ad-supported options, looking for discounts and bundles, and moving on and off services to satisfy their content needs. But COVID-19 could be ushering in a permanent shift in entertainment, where it’s not just about streaming, or the number of subscribers, but also importantly about how platform providers are responding to subscriber churn by providing enhanced experiences and the ability to connect with others on their platforms.

The survey shows 82% of respondents say they are concerned about COVID-19 variants, and that’s likely keeping people indoors and online. Boomers and Gen X still rank “watching TV shows or movies at home” as their favourite entertainment activity; Gen Z still rank “playing video games” as their preferred form of entertainment.

65% of respondents are frequent gamers, playing at least once a week; on average, these frequent gamers play for around 12 hours a week. 65% of consumers are engaging with at least one social media service several times a day.

“Churn & return” behaviour is most common with younger generations. Almost half of millennials (47%) and 34% of Gen Z cancelled and then re-subscribed to the same streaming video service later that same year.

The top reason consumers cancelled a paid streaming video on demand (SVOD) service was due to high cost followed by the fact they finished the show they signed up to watch. Furthermore, 65% of consumers watch free ad-supported video services.

In-home entertainment still preferred

Deloitte’s most recent survey revealed that changes wrought by the pandemic are continuing, but compared to six months ago, consumers across generations have actually been spending more time watching TV and browsing the internet as they seek indoor entertainment options and avoid out-of-home experiences.

Over 80% of US respondents remain concerned about COVID-19 variants.

When asked to describe their recent behaviour, 84% of respondents say they are spending more time on online entertainment activities and less on in-person entertainment outside of the home.

About half of consumers (48%) say they spend more time on online entertainment versus six months ago.

Boomers and Gen X still rank watching TV shows or movies at home as their favourite entertainment activity. Gen Z, meanwhile, still rank playing video games as their preferred form of entertainment.

“We’re seeing an important shift in what consumers are paying attention to and how they are choosing to engage and be entertained”, said Kevin Westcott, vice chairman, Deloitte LLP and US technology, media and telecom leader. “While streaming video will continue to gain momentum, especially with leading services now pursuing global markets, these companies will also need to address churn and retention among diverse segments in different markets, and shift from merely measuring subscribers to understanding how to unlock the lifetime value within their customer bases. It will serve them well in the future to develop growth strategies that include both social video and social gaming, whether through partnerships, acquisitions, or simply establishing a really effective social media department.”

Social media: free, fast and flexible

The use of social media and online services is widespread among US consumers and is a daily activity for many. Social apps are free and primarily mobile, reaching users wherever they are located. People are watching videos on social media, especially short videos made by average users and influencers. And with many consumers using these services, media and entertainment options are migrating onto them, and social commerce is booming. 

About 90% of respondents cited using at least one social media service, and the average person uses five different services. This number increases to seven for Gen Zs and millennials, with about a quarter of each using 10 or more different services.  

65% of consumers are engaging with at least one of these services several times a day. The top reasons for using social media are staying connected to friends and family (51%) and staying up to date on news and current events (31%). Discovering new content also ranked highly: 21% use social media to discover new video content, and 16% use it to discover new music.

While a third of respondents say they are watching more video on paid streaming video services than they were six months ago, nearly as many say they are watching more video on social media and live streaming services. 44% of consumers follow an influencer on social media.

Roughly 4 in 10 US respondents say that they have seen a product on social media and gone to the retailer’s website to buy it or clicked on an advertisement that led to a purchase. 31% of respondents have made a purchase directly on a social media service. Younger consumers are more likely to find recommendations from influencers important to their purchasing decisions.

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