If basic cable
programmers are in fear of losing young customers due to soaring cable subscription prices, premium-priced pay television programmers could be at greater risk.
A new study says pay TV
programmers are at risk of losing young TV viewers/consumers 18-29 -- so-called Generation Ys, about 70 million strong -- due to growing price sensitivities for all kinds of subscription television.
Pay-TV networks monthly prices are added on top of existing packages for basic cable programming channels.
A study by independent research group for Ideas & Solutions!, a marketing consultancy,
says 69% of the on-the-fence young cable customers, classified as "at-risk" responders, and 61% of those described as "leaners," say the expense of pay-TV networks is the main reason they would
consider discontinuing their service.
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An added concern: this cable demo also notes there are other alternative ways of watching entertainment content.
Those "at risk" consumers --
cord-cutting cable, telecom or satellite providers -- use Netflix and Hulu nearly 50% of the time. But when looking at the strong proponents of pay TV networks -- which the study calls "loyalists" --
only 29% use Netflix and 25% watch TV via Hulu.
Those in between "at risk" and "loyalist" pay TV consumers -- "leaners" -- use Netflix and Hulu, around 42%.
Glen L. Friedman, president
and founder of Ideas & Solutions!, stated: "This is the demographic that completely transformed the music and the phone business and has already started to dramatically reshape the pay-TV ecosystem."
How can companies combat this tend? For those young consumers who are thinking about leaving pay TV networks behind, the survey recommends a shift in pay TV network marketing away from touting
big-scripted shows playing in specific time periods. Instead, the effort should be around cost and service, as well as time-shifting and on-demand capabilities.