Study shows younger customers more likely to cancel then renew streaming services

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I often find myself subscribing to streaming services when the membership is discounted. After I have binged all of my favorite shows, I tend to cancel my membership. Supposedly, I am a part of a customer demographic who participates in a behavior called “churn and return.” According to the “Digital Media Trends” study by Deloitte, churn and return is practiced by nearly half of millennials, a third of Gen Z and a quarter of Gen X. Churn and returners tend to resubscribe to that same service within a year to once again cancel services after watching their shows. Deloitte’s vice president Kevin Westcott stated that streaming services should focus on retaining these customers by including “social gaming” and “social video” to their platform. Below are a few more highlights from Variety:

Now there’s a name for this behavior: “churn and return,” a term coined by consulting firm Deloitte. It’s most common among younger generations: Nearly half of millennials (47%) and 34% of Gen Z in the U.S. canceled and then resubscribed to the same streaming video service within the following 12 months, according to Deloitte’s latest “Digital Media Trends” study.

Among Gen X consumers, 25% say they’ve engaged in “churn and return” in the last year, while the rates are even lower among Boomers (6%) and Matures (3%), Deloitte found.

The relatively high churn-and-return rates among younger generations means subscription VOD services are losing out on revenue they might otherwise have been able to capture, said Kevin Westcott, vice chairman of Deloitte and the firm’s U.S. technology, media and telecom leader.

According to Westcott, subscription VOD providers need to develop growth strategies that include both social video and social gaming to minimize churn rates. Netflix, for example, has launched an effort to expand its SVOD service with video games — bundled into the core subscription — and recently acquired its first gaming company, Night School Studio.

“While streaming video will continue to gain momentum… these companies will also need to address churn and retention among diverse segments in different markets,” Westcott said.

On average, the six-month churn rate for SVOD services in the U.S. has remained stable at between 36%-38% throughout the pandemic, according to the Deloitte research. The top reason consumers say they dropped an SVOD service was due to the price; No. 2 was because they finished a specific show they signed up to watch, the study found.

[From Variety]

I personally would not get turned on by social video and gaming services so I guess I am not their target market (I’m a Gen Xer). Most of the people I know tend to cancel their membership when they either run out of great shows to watch or disposable income to pay for said services. I am assuming that if a streaming service like Netflix or Apple TV added social gaming or video to their platform that would mean a price hike for the membership services. If people are canceling their memberships because of money, which I would assume would be the case for a lot of the younger millennials and Gen Z, then that would defeat the purpose.

I also feel like this study may have missed the fact that a lot of people share services with friends and family (because we are either cheap or broke or both). Since Gen Z prefers to play video games according to this study over staying home to watch movies and TV shows, I wonder if having a separate membership for gaming only would help retain these clients? I feel like when it comes to this study, my middle-aged frugal ass has been canceled out. I’m gonna keep churning and returning until I can find a bundle that’s within my price range of less than $20 a month and includes all of my favorite streaming services like Netflix, HBO, Starz and Apple TV. Until then, they can miss me with trying to entice me with a social video or gaming service. What I want is amazing content that’s reasonably priced.

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Photos are production stills from Stranger Things credit: Netflix

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32 Responses to “Study shows younger customers more likely to cancel then renew streaming services”

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  1. Ariel says:

    I am gen x and I tend to keep Netflix, boomerang (cartoons) and Hulu and come and go from others. Right now I have peacock (the new Martha and Snoop Halloween baking contest starts tomorrow !!!) and paramount.
    Sometimes I have hbo max and I love Disney plus once in a while (always rewatch Hamilton and some Muppet Show episodes).
    Occasionally starz.

    As long as I remember to cancel things we aren’t really watching much of- my system works and keeps my costs reasonable.

    And it starts with asking the nice man I live with – are you using Hulu at all these days ?

    Turns out he found a cache of movies on paramount he’s enjoying at the moment.

    • Lucky says:

      Same! I keep Netflix for me and we have Prime video because we have prime. I keep a Disney +/Hulu bundle for the teens, though the are close to done with it.
      Then I rotate through a few streaming services and cancel after I binge it all. I like to subscribe through my phone because it makes it easy to immediately cancel – that way I can keep the service through the month but it doesn’t auto renew!

    • LadyMTL says:

      I’m a Gen-X’er too, and relatively new to the streaming world – I signed up for Disney+ just this past spring – and tbh I was considering cancelling it a few times but there’s always something popping up that keeps me interested. They recently added Golden Girls (my favorite show ever) and then also had Only Murders in the Building, so I decided to keep it for a little while longer. At some point I may add Amazon TV too, but I’m still on the fence.

      I personally wouldn’t be tempted by videos or gaming, I want a good selection of TV and movies and that’s it. If Disney+ would offer Hulu here in Canada I doubt I’d ever want to get rid of it.

    • BayTampaBay says:

      @Ariel & other CBers – What do you regularly watch on Netflix? I want to try some new Netflix shows.

      I have Netflix to watch Grace & Frankie but tend to watch more BritBox, AcornTV and PBS streaming.

      • Anners says:

        My favourite Netflix shows are mostly British – I really liked Broadchurch, Happy Valley, and Call of Duty. I love love love Derry Girls, Never Have I ever, and Sex Education. I’m not sure if Detectorists is still on Netflix (but it is on Prime) and it is one of the most beautiful gems of a show – written, directed by, and starring Mackenzie Crook (and Toby Jones…it’s just lovely). And as often stated here, Schitt’s Creek is great (first couple of episodes are not the best, but I definitely got into the characters as time went on). Hope that gives you enough to start with 😊

  2. Genevieve says:

    Yeah, I’m Gen X, and I do this. I just signed up for Acorn a couple days ago, and cancelled immediately, because I know I’ll be done watching my (relatively few) shows within a month. Disney+ giving a notable discount for a year’s subscription is about the only thing that’s keeping that one going in my house.

  3. Aeval says:

    We’ve just started rotating through the streaming services, instead of trying to keep all the biggest and best at once. There’s only so many shows we can follow at one time, so it makes sense.

    The only ones we always have are Prime (since it’s more than just a streaming service) and Hulu (since we get it free with our Spotify deal). For the rest, we pick one service to subscribe to for the month, binge anything good and then drop it until next time.

  4. Katherine says:

    Why would I keep paying if I don’t watch? I honestly prefer just buying. I hate subscriptions as a phenomenon. And yes, I have bought TV shows that weren’t available for streaming, so not just talking here (they are pricey so I mostly pay for streaming, of course). And obviously I will be subscribed to only one streaming service at a time and switch when I need a show on a different service. I’m not loyal to a streaming service, I’m interested in individual works of art – shows and movies. I don’t care if I buy them from Netflix, Google, Amazon, Hulu, HBO, Apple TV, etc. Let alone the fact that I’m not in the US and while I do pay the same price I don’t get all the content with streaming because of geo restrictions. I get licensing issues and all, but it’s still unfair.

  5. Liesel says:

    I’m an older GenX and for the past three years I refuse to pay for more than 1 streaming service at a time. I pick one and when I watched what I’ve wanted, I cancel it and move on to the next one.

    For most of the year (at least since April) I only paid for MLB (I’m outside the US and it’s way overpriced). I also had Apple+ for free. But the Giants are out of the playoffs and my free Apple+ is ending. I guess I’ll move on to Disney+, but I might wait until Hawkeye comes out.

    I enjoy the comfort of a good rewatch instead of trying something new. I have the Friday Night Lights DVDs, so I might just watch those first before signing up for another streamer.

  6. BW says:

    Boomer here. I’ve been churning and burning from the beginning if there’s nothing else I want to watch. I tend to keep Netflix, but the others I drop after I’ve binged everything I wanted to see on the free trial.

  7. Jessica says:

    We have a bunch of streaming services and the only one I’ve ever cancelled and renewed has been HBO. I’ve had Netflix since they sent dvd’s in the mail, but my bf’s mom pays for that subscription. My bf pays for Amazon (cause he has prime) and HBO. I pay for Disney+/Hulu/ESPN+. My friend made me a profile on his Discovery account so we have that too. And Apple TV came free when my bf upgraded his phone last year. With everyone paying one subscription and sharing log-ins, it’s not too bad. But it is a top annoyance when what we want to watch isn’t available on ANY of them!

  8. WithTheAmerican says:

    Games? MISS ME. I will drop Netflix so fast if they raise rates to include games. Puke.

    • EveV says:

      Exactly what I was thinking. They’re already getting a little too pricy, they jack it up any higher (especially for video games!) and I will get rid of it quicker than anything.

  9. Sigmund says:

    I’m a millennial and we started cancelling and renewing the last few years when there’s something we want to watch. We had Netflix for a long time, but once the streaming services started spreading out, there was no longer one service that had everything we want to watch. So we renew for a month or so when there’s something we want to see.

    I will say, I think services need to watch how they’re trying to address this. Discounts for signing on for a year, gaming plans…those wouldn’t work for me, but they’re fine, I guess. But if they make it too hard for people to subscribe in the way that works for them, I think piracy will become a big thing again. Just my two cents.

  10. Common sense says:

    “Social gaming” and “social video” is a 👎from me. They want streaming services to turn into social media, don’t we have enough of those. And we know that social media isn’t all that great. I have Netflix and prime video and they are fine just the way they are.

  11. Case says:

    I’m a millennial and I’m really conscious about how I subscribe to different services. I subscribe to YouTubeTV September through March to watch spooky movies and all of award season, and then I press pause the rest of the year because it’s just too darn expensive. I subscribe to Hulu if they have something I really want to watch — for example, I’m interested in Only Murders in the Building but have been waiting for the full show to be released before I resubscribe. Netflix and HBOMax are my mainstays because I use them regularly (and I split the HBO subscription with a friend).

  12. SoylentGreen says:

    Gen Xer here. I keep the core channels: Netflix, Hulu, Prime, HBO, YouTube tv, Disney+ and Apple+ year round. However I share with my adult kids and hubby who is on the road 90% of the year (he insists on the YouTube tv and Hulu, otherwise I would’ve ditched those days ago) . I add on to my Prime and those are the channels I churn through. Such as paramount, starz, showtime, AMC, Acorn, Masterpiece theatre…. Etc.

  13. Kathy says:

    Born in ‘65, so I don’t know what ‘gen name’ that makes me. Old. I’ve had basic cable for years. I have AMC, Disney, SciFy, TNT, TBS, TCM, ESPN, etc. Why on earth would I pay more to watch shows on their streaming channels?

  14. Cate says:

    Older millennial here. We just don’t watch enough TV to justify paying for multiple services, so yes, we will get a free/discounted trial, binge watch a few shows, then cancel and move on.

    Also, our library has both hoopla and kanopy which are GREAT for streaming TV and movies. We are currently working our way through Death in Paradise on Hoopla and it is fantastic!

    • Ky says:

      @Cate I really wanted to watch Miss Fisher last weekend but I’d canceled Acorn. My library also offers Hoopla and it has changed my life! Thanks

    • BeanieBean says:

      Loved the entire Death in Paradise series. Watched it on Acorn, which was my first streaming service. I’ve stuck with that, and only recently added Amazon Prime. I subscribe to Peacock, too, but only the free service, which is enough for me. I’m kinda cheap.
      Ky: be sure to watch the Miss Fisher Modern series too! It’s a lot of fun.

  15. Leah says:

    I think the trick is to limit them so they don’t feel so overwhelming.

    I’m Gen X. I have Netflix, paramount+, shudder, criterion, HBO max and BritBox. Prime video comes along because of my prime account. I used to have a few more until I realized that they weren’t being used because I didn’t have time. I don’t have cable so those streaming services fill in the gaps. HBO max has the TCM hub which finally allowed me to cut the cable cord because before it wasn’t available that way. I remember having to pay for it separately because it was on a different cable tier with spectrum.

    I had to twist my boomer friend’s arm to get paramount +, she had been leaning that way for a while (CBS is her network of choice plus Star Trek fan so it wasn’t that hard) but balked until she retired. Helped her set up the roku last weekend so right now she’s just exploring. She didn’t want to get caught up in what she called “the streaming trap”.

  16. Christine says:

    I cancel streaming services a lot. There are too many options out there with not enough content to warrant a continuous subscription.

  17. Amber says:

    I’m 28, so I’m a young-ish millennial. I’m on my mom’s Netflix account and then I pay for Amazon prime. I used to pay for Filmstruck when it existed lol. Since I only watch older movies, that’s why I pay for Prime–it gives you a lot of options for old movies that other streaming services don’t have. But if my mom took me off the Netflix account, I would not re-subscribe. Aside from The Crown I don’t enjoy their original content, I use it to re-watch old shows like Gilmore Girls, so I’d just buy the DVDs. I feel so much pressure to keep up with all the new shows that paradoxically it’s made me want to bounce out of all of it. I haven’t watched Netflix in over a month.

  18. Bendy Windy says:

    Yeah. If there was regular A++ programming, I wouldn’t cancel. But if I subscribe and then watch everything, I’m canceling my subscription because $10 here, $15 there for all these different services adds up. I cut cable because of the price. I don’t want to have 15 streaming services that add up to the same price.

  19. Twin falls says:

    Family movies are big in my household so Netflix and Disney+ stay. Prime video comes included with my prime delivery service, I don’t know that I’d pay for it separately. Prime video makes it easy to add and drop other channels like Acorn, HBO, Britbox on an as interested basis. That’s all we use though. No cable, no Hulu or YouTube tv. My 14 year old barely watches tv. He plays video games. I have no idea what social gaming is but if it’s appealing to gamers, I can see households adding it in/and or getting a bundle because of it.

  20. ConcernFae says:

    Criterion Channel (classic, foreign, and “arthouse”) is my forever streaming. I rotate through the others and tend not to keep subscriptions going through the summer. By the time it’s dark it’s too late to start a movie.

    I only really started seriously rotating until my internet only price was raised to what my internet and cable only package used to cost. All these services need to see that they are part of an overall cost center. Somebody raises prices, everybody else takes a haircut. To use the proper business terminology.

  21. Sarah says:

    I’m an X’er and I am a churn and returner for certain streaming subscriptions. My hubby has had Netflix for so long that we just keep that and a friend lets us use their HBO MAX. We have Peacock because our internet provider gives it to us for free, and we are big Marvel heads so we use Disney + (initially churned and returned but the shows are keeping us subscribed for now- if anything changes we’re gone). I churn and return hard with HULU, there is no one show or movie that makes me want to keep it so I wait for a new season of something that I like (i.e Killing Eve because I hate commercials) use some cc points for a gift card and then watch until we’re done and will not resubscribe until the following year.

  22. Mabs A'Mabbin says:

    Xer here, and my husband and I were screaming for a la carte viewing since the early 90s, so we churn and burn loving every minute of it. We do, however, keep Netflix, Amazon, HBO and Disney. And we haven’t paid for cable since 2005.

  23. Maxine duCamp says:

    Gen X, I currently have a fair number of streaming services because I’m only midway through one year free subscriptions to Apple+ and Disney (once they are over wii probably keep Apple+ and drop Disney. I have free access to Netflix using my sister’s account and a couple of years ago Spotify added free access to Hulu if you have a paid Spotify account. I pay for Amazon prime but will not renew my annual subscription because I’m trying to be more thoughtful about where I spend my $ and I watch so few things on Primet that it would be cheaper to pay to buy or rent them. If there’s a show on another streaming platform/app that I really want to watch, I’ll wait until all the episodes have dropped and then sign up for a month, binge the shows that interest me and then cancel the subscription.

  24. NotSoSocialButterfly says:

    Haha, that’s because they use VPNs and just set up with a new email when the trial period is over.