How Streaming Video Can Keep Up Its Momentum Past 2020

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As consumers hunkered down at home in the wake of COVID-19 shelter-in-place mandates, they turned to online entertainment, driving a surge in streaming. With content options at an all-time high and a range of new streaming players entering the field, the already multi-pronged entertainment industry seems set for yet another big transition.

But questions remain around the resilience of these trends and whether they can last. For streaming platforms, continued success will entail looking closely at what drives consumers to streaming services, rethinking production workflows in our new era of physical distancing and investing in a wide range of content to keep up with evolving customer demand.

Streaming Traffic Trends 

The increase in streaming traffic was evident early on: During the first three weeks of March, when shelter-in-place mandates took shape, consumers recorded an 85% increase in minutes streamed, per Nielsen, against a comparable three-week period in 2019. Streaming platforms are particularly appealing to consumers — with reasonable monthly rates, easy activation and a seemingly unlimited library of content that caters to a wide age range. 

However, streaming traffic is unlikely to return to pre-March levels, as consumers have demonstrated they are willing to try new streaming options. Additionally, as the economy reopens and other options — such as sports, concerts, shopping, dining and travel — resume competing for consumers’ time, expect streaming usage to level off.

That said, the strategies already deployed by streaming services to maximize viewership are still relevant. As PwC research illustrates, consumers value an experience with easily accessible shows, a simple interface and a robust content library with original programming.

Production Uncertainty 

With production temporarily halted, releasing original content has become one of the biggest challenges facing media companies today. Projects already in the pipeline have served as a buffer so far, but as this grace period draws to a close, the effects of the scarcity will become more pronounced.

One consequence will be an increased tendency for consumers to hop between platforms in search of new shows, thus fraying the edges of customer loyalty, already strained by the profusion of recent platform launches.

The stakes from the halt in production reverberate across the entire industry: Research from Microsoft and PwC highlights how the under-delivery of episodic content could result in more than $3.5 billion in lost ad revenue for broadcasters. 

The answer, of course, lies in restarting production, but that comes with its own challenges and risks. Effective contact tracing — along with strict protocols and thorough health screenings of production staff and talent — will be indispensable for safety.

In general, doing more with less — limiting the number of people on set; reinforcing protocols and resources for seamless remote production; and creating innovative workarounds for norms (such as live audiences for tapings) that are unlikely to resume any time soon — will become commonplace.

Conversely, many of these new efficiencies could last post-pandemic. In fact, CFOs in the sector told PwC the trends accelerated by the pandemic such as the shift to increased work flexibility, resilience and technology investment will increase productivity in the long run.

Content Preferences Change

From the streaming debut of popular musicals to more talk or late-night formats, not to mention content based on the pandemic period itself, opportunities for truly original programming abound. In general, the coming months will likely feature content emphasizing escapism as streaming services continue to take on the mantle of now-shuttered movie theaters, whose escapist fare has traditionally made them countercyclical to recessions.

By the same token, content can amplify and provide needed perspective on decisive issues facing society. The recent protests against systemic racial injustice have forced industries to rethink diversity and inclusion efforts, signaling that content addressing these issues will be in high demand. And that goes for content produced by and starring more diverse talent.

Even the way consumers watch their shows is now different, with many consumers gathering virtually with friends as they comply with physical-distancing guidelines. It’s a trend likely to persist post-pandemic as a way for separated groups to connect, making even on-demand content feel like an actual event. From integrating these capabilities onto their platforms to organizing these events through social media, companies now have an array of new strategies to engage viewers. 

Keeping People Watching

While the rest of 2020 will likely present more uncertainty, new challenges and even more change, these hurdles will also serve as opportunities to connect with consumers in new ways while driving increased loyalty. Getting it right means more than just navigating this period for the short term; it means laying the framework for greater success in the years to come. Ultimately, the goal is for consumers to keep calm and stream on.

Mark McCaffrey, PwC