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Tag: Parks Associates

  • Amazon Prime Is the Top US Streaming Service

    Amazon Prime Is the Top US Streaming Service

    Amazon Prime has pulled off a major win against Netflix, supplanting it as the top streaming service in the US.

    The latest research comes from Parks Associates, and shows Amazon Prime taking the top spot in the US for the first time in 2022. In previous years, Prime consistently took second place.

    Nonetheless, despite Prime’s move up, Parks Associates believes Netflix is well-positioned to regain the top stop.

    “Streaming services are introducing new content, services, and partnerships that are changing how consumers interact with video,” said Jennifer Kent, VP, Research, Parks Associates. “Netflix’s ad-supported plan gives the company a way to win back subscribers who left over high subscription prices. It also gives Netflix a path to creating unique accounts for those who have been content to share passwords with friends and family in the past. It’s an exciting time to track these services, with lots of disruption and change.”

    Credit: Parks Associates

  • Netflix Beats Cable for Customer Satisfaction

    A new study has revealed that customers rate Netflix Watch Instantly higher in customer satisfaction than premium broadcast TV. The study, from market research and consulting firm Parks Associates, cites the low cost and high viewing flexibility of Netflix streaming as part of the reason for the service’s popularity.

    “Consumers can pay for a month of Netflix for about the same amount as for two pay-TV VOD movies,” said Brett Sappington, director of research at Parks Associates. “Parks Associates research shows consumers know the quality of the OTT service is not comparable to pay-TV quality, but the cost-benefit comparison is enough to affect their purchase decisions.”

    The study shows that 16% of U.S. broadband customers consider using a streaming video service such as Hulu or Netflix when watching an on-demand movie. This makes perfect sense, as one month of Netflix Watch Instantly service costs as much as only a couple of video-on-demand (VOD) purchases. The study also shows that 17% of people watching premium TV channels, such as HBO or Showtime, also consider streaming services as an alternative.

    “Netflix is competitive against VOD and premium channels because it has a decisive edge in cost,” said John Barrett, director of consumer analytics at Parks Associates. “Its greatest weakness is picture quality, but there are times when the consumer will sacrifice quality for other considerations. Pay-TV providers need to develop alternative services that counter Netflix’s advantages in cost and flexibility.”

    Cable services have been overpriced since before internet streaming services existed. Many, if not most, cable channels are full of low-quality, niche programming. Only a few channels, such as ESPN and HBO, could make money charging individually for their high-quality content. Yet cable companies force subscribers to subsidize packages of hundreds of channels. It is taking the massive disruption of Netflix and Hulu to finally break the hold U.S. cable companies have had over TV, and still those companies are digging in their heels by failing to innovate, improve customer choice, or lower their prices. The U.S. Department of Justice only recently noticed the steps cable companies are taking to maintain the status quo and choke out the competition brought by streaming services.

  • Online Video Ad Revenue To Surpass $1.3 Billion

    Online Video Ad Revenue To Surpass $1.3 Billion

    U.S. online video advertising revenue is on track to surpass $1.3 billion this year, according to a new report from Parks Associates.

    Steady growth in online video viewership, combined with the ability to target specific viewers based on preferences and viewing history is the reason behind the figures.

    The report found large percentages of consumers, specifically younger consumers, have not formed a strong opinion about targeted advertising. These ads include pre-rolls shown before an online video or overlays displayed during a show, with the content based on the user’s viewing habits.

    Among U.S. broadband households, almost 50% of heads-of-household aged 18-34 are indifferent to targeted advertising, while 42% aged 25-54 and 25% aged 55 or older are neutral.

    Targeted-Ads

    "Indifference indicates consumers can be won over by new advertising strategies, provided these messages are designed well, with truly relevant content," said Heather Way, research analyst, Parks Associates.

    "Also, the younger age groups are more receptive to the concept of targeted advertising, and advertisers place a premium on the ability to reach these demographics."

    While online video does not yet have the same audience reach as traditional broadcast and cable TV, the medium continues to grow its user base, and increased content offerings via TV Everywhere initiatives will bring in more viewers and boost advertising revenues. Currently over 50% of heads-of-household 25-54 watch online video at least weekly, and the percentage jumps to 75% for ages 18-34.