The Importance of CX in Media Streaming

Netflix launched in 1998 as a mail-order DVD service that would have more movies than were available at Blockbuster, and, as a film and TV buff, I subscribed in 1999. Since I was one of the earlier subscribers, I've seen the company transform from DVDs encased in a red envelope being delivered to my door, to a streaming platform.

Streaming media online began in 2007 and caused competitors – like Hulu and Amazon Prime – to launch similar services to capitalize on the revenue available from this new, convenient way of consuming content. In 2013, Netflix started releasing original content with House of Cards leading the charge, which got the company a seat at the table with traditional networks and premium channels, such as HBO, CBS, FX, and the ilk.

By disrupting the industry and strategically positioning itself in line with the biggest players in the space, Netflix has created an even playing field in media, distinguished mainly by content available on each platform and CX.

Bet You Can’t Pick Just One

According to Deloitte, the average U.S. consumer subscribes to three video steaming services, with 43% of consumers subscribing to both streaming and traditional cable. I subscribe to Netflix, Hulu, Amazon Prime Video (with the HBO add on), and CBS All Access when certain shows are in season – and I formerly subscribed to services like Starz and Showtime.

According to Netflix’s own research, it only has 90 seconds to catch a subscriber’s interest with a suggested show or movie before they go to another app.

Though the many streaming services rake in revenue from subscription fees, keeping customers engaged with the best purchased and original content and great CX is what keeps them returning month after month.

Content, Content, Content

According to CwP, one of the top reasons why consumers cancel subscription plans is due to a lack of content that appealed to them, which is why Netflix is reportedly spending up to $15 billion on original content this year.

The investment in original content seems to be paying off as it has won at the Oscars, Screen Actos Guild Awards, BAFTA Awards, Golden Globes, Emmy Awards, and more.

To keep pace with its rapid subscription growth, Netflix released 86 movies in 2018 alone and dished out millions for contracts with top-tier producers, like Shonda Rhimes and Ryan Murphy. As a result, the streaming service has had to raise subscription prices up to 18% in the U.S. this year.

Traditionally, loyal customers are less concerned with price, but media streaming companies must constantly work to make sure that loyalty doesn’t waver.

The Value of UX and UI in Streaming

User experience (UX) and user interface (UI) are extremely important aspects for media streaming companies to master because they can determine what content is being watched and how long consumers stay on a platform.

A major component of a powerhouse UI in the media streaming industry is ease-of-use. In 2015, Netflix redesigned its platform, adding the black background we’re all overly familiar with, making it easier for consumers to scroll through content on its main landing page.

Hulu’s UI is the exact opposite of dark and dreary. The landing page hits you in the face with bright colors and a minimalist design. While the design looks nice, many users have complained that it was distracting and difficult to find content on the platform. The brand used this feedback to its advantage and will be rolling out several new design updates this year.

There’s much more to UX in the media streaming industry, and it starts with personalization.

Platforms use AI and ML to track data on what you watch so they can suggest additional content based on your interests. Between carefully tailoring content, adding the “skip intro” feature, and auto-playing previews, streaming services increase engagement and get you to consume content you wouldn’t normally seek out.

Many consumers, including myself, are searching for features that support diversity and inclusivity. I’ve noticed that I keep going back to Hulu again and again because of the platform’s LGBTQ content section. I’m not sure if other services offer this type of content, but to be honest, I never did the research because I already knew Hulu had exactly what I wanted.

As time goes on, more competitors emerge in the space, and trends change, media streaming giants must evolve UX and UI to appease audiences since they hold all the cards.

The Battle for Licensed Content

Nearly every major TV network is trying to hop on the media streaming bandwagon. And as a result, networks aren’t renewing licensing deals with streaming companies. Content providers like NBCUniversial, WarnerMedia, and Walt Disney Co., have announced that they will only continue to license content to other providers on a show-by-show basis.

Content from these companies makes up more than 40% of the viewing time on Netflix, according to data collected by The Wall Street Journal.

Netflix, Hulu, and Amazon Prime might have to pay double, or even triple, the original amount to keep consumers on their platforms watching The Office for the 13th time (I'm looking at you, Billie Eilish), or begin contemplating a future without some of their main attractions. But, seeing as Netflix doled out $100 million for a one-additional-year contract for Friends, its clear companies are willing to go pretty far to avoid backlash from customers.

Only time will tell if and how licensed content will affect subscriptions, or if there will just be more platforms added to our respective monthly auto-drafts.

The Future of Streaming

Media streaming has already led to millions cutting the cord of traditional cable and it seems the future will be full of partnerships among networks and networks adapting strategies to keep up. And, in order for companies to get a leg up on the competition, it’s going to come down to prioritizing customers and their feedback.

By listening to users and making data-driven decisions, media streaming companies can prevent customer churn that comes from binging and cancelling and subscription fatigue – when customers are exhausted from having to subscribe to yet another service.

We put together a demo video to show how Stratifyd can help media streaming companies increase customer retention and acquisition by analyzing, categorizing, and visualizing actionable insights in minutes.

About the Author

Cara Walters is the Senior Marketing Director at Stratifyd who enjoys reading short stories, gardening, hiking to find waterfalls, and cooking her grandma’s Italian recipes.

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