
By Mallory Mattingly
Streaming services use digital ads to attract new subscribers; however, those ads aren’t bringing new users to the platforms like they used to.
According to The Streamable, executives heading up streaming services “are not feeling bullish about the prospects of direct digital advertising. Fully 80% are planning to cut back spending on at least one paid advertising channel, including paid search ads, display advertising, and paid social ads.”
A study from Bango revealed that “Nearly half of subscription leaders say returns from direct acquisition are declining, while over half report that once reliable strategies such as paid search, display advertising and social media ads are becoming harder to sustain.”
So what’s the solution? Bundling.
Bango explained, “the industry is evolving: from direct to indirect, and from a subscription economy to a bundle economy.”
And more than 60% of consumers would prefer it that way.
Many bundled streaming plans — like Disney+, Hulu and ESPN or the new Verizon myPlan, which offers users a bundle of Max and Netflix — are already available. According to The Streamable, 90% of subscription brands already have or plan to have bundle options this year.
“We’re seeing a clear shift from the subscription economy to the bundle economy,” explained Bango subscription expert Giles Tongue. “Consumers don’t want to manage ten separate subscriptions — they want value, convenience, and flexibility. The brands that win in this next phase will be the ones that package their offerings in ways that reflect how people actually want to buy.”
Related: Why Creators Don’t Want Ads on Streaming Platforms
Consumers are already frustrated with streamers, especially when it comes to advertisements. According to a study from Wunderkind Ads, “91% of viewers say they won’t purchase from brands that serve interruptive ads,” per Fox Advertising.
Right now, bundling looks like the best way to appease viewers.
“Nearly 1 in 3 [subscribers] (28%) say they get a worse deal when subscribing directly, rising to 41% for those under 35. With 62% of US subscribers preferring a bundle over multiple individual subscriptions, the growth potential is clear,” Bango explained.
“We’re seeing a clear shift from the subscription economy to the bundle economy,” Tongue told WWD. “Consumers don’t want to manage 10 separate subscriptions — they want value, convenience and flexibility. The brands that win in this next phase will be the ones that package their offerings in ways that reflect how people actually want to buy.
As the streaming wars continue to rage, the best way to success seems clear: streaming services that bundle their plans will entice more subscribers.
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