Discounts and promotions bring cord-cutters back to pay-TV
Joseph O'Halloran | 17-04-2013
New research from Parks Associates has found that promotions such as offering free or discounted premium channels are the most effective tool for pay-TV providers in luring back subscribers lost to over-the-top (OTT) services.
In its Pay-TV Re-connectors and the Netflix Exes analysis, the analyst found that 44% of customers who re-subscribed to pay-TV services in the past 18 months said a promotion was a significant reason for their return after cord-cutting and cancelling their subscription to services such as Netflix Watch Instantly.
"Most people leave pay-TV services due to economic factors, and these are the main influencers bringing them back," explained John Barrett, director, research, Parks Associates. "They are not dissatisfied with Internet video. In fact, many cited Netflix Watch Instantly as a very satisfying experience. These re-subscribers were simply ready to take advantage of a promotion as their own financial situation improved."
Looking at individual operators and their tactics, promotions and/or discounts were the leading factors for re-subscribers with Comcast, Time Warner, DirecTV, and DISH Network. For AT&T and Verizon, re-subscribers cited content-related reasons at a higher rate, slightly ahead of promotions.
"Content availability is an important consideration for TV viewers, and these promotions seem to be the final push many consumers need to jump back into the pay-TV fold," Barrett added. "At the same time, economic factors work against Internet video services. Consumers who cancelled their Netflix account cited a need to save money or were responding to the company's price increases."