Pay-TV operators have long struggled with low customer service scores, and that poor experience for consumers has actually hurt subscriber retention, according to a new study.
A full 84% of consumers surveyed by Paywizard, which handles subscriber management and billing tools for pay-TV companies, say they’d drop their pay-TV subscription based on poor customer service, with nearly 25% saying they’ve done just that in the last year, due to their provider’s inability to offer a positive experience.
Conversely, 46% of those surveyed said they’ve retained a pay-TV subscription they might have cancelled otherwise, thanks to a positive consumer relations experience.
The survey drew on the responses from more than 6,200 pay-TV consumers across six countries, including Australia, Brazil, Germany, Singapore, the U.K. and the U.S. The survey covered OTT operators as well, including Amazon, Hulu and Netflix.
“We are seeing a fundamental shift taking place in the pay TV marketplace, with customer experience emerging as critical to television service providers’ success – in many cases, their very survival,” said Bhavesh Vaghela, chief marketing officer for Paywizard. “While content and cost are often cited as the elements influencing pay TV uptake and cancellations, the survey findings demonstrate that customer experience has undeniably emerged as a major driver. This is particularly true for operators of over-the-top (OTT) services, as simply relying on a decent content offering is no longer nearly enough to build loyalty to your brand.”
“With industry projections indicating roughly a billion pay TV subscriptions are up for grabs this year – and billions in revenue are on the line — it is clear from the research that pay TV operators today ignore customer experience at their peril.”
The survey found that younger consumers are more easily put off by a poor customer service experience, with 57% of those under 35 telling Paywizard how they’ve been treated by their provider has factored into their retention in the past year. And if a subscriber is treated well, nearly three in four say they’ve actually upped their spending on pay TV in the past year because of their experiences.
Among country-specific responses, Germans are least likely to cancel over a poor customer service experience, with 66% responding that they would walk away from a subscription based on how they’re treated. Brazilians were tops in saying they’d walk away, with 88% responding in the affirmative. U.S. respondents ranked No. 3 for that question at 81%.
“The research leaves no doubt that to stay on the right side of the TV spend equation as more options emerge for consumers, all pay TV operators — particularly those that don’t tend to lock subscribers into fixed-term contracts, such as many OTT providers — need to ensure they take their brand beyond its content offering by providing consistently excellent customer experience,” Vaghela said. “In other words, providers of all stripes need to be proactive in engaging consumers at each key decision moment along the customer journey.”
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