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Why super bundling is unlocking new opportunities for content providers

November 7, 2023
in Technology
Why super bundling is unlocking new opportunities for content providers
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The subscription economy is forecast to be worth $600 billion by 2026, made up of more than 4.2 billion subscriptions across entertainment, music, education, well-being and lifestyle content. 

However, a 2022 Bango survey of 2,500 U.S. consumers found that 72% found that there are “too many subscription services.” A similar Bango study released in September this year of 6,000 subscribers in India and Southeast Asia found that 81% were overwhelmed by the number of digital subscriptions on offer. 

As much as consumers use subscription services, they are also overburdened by the sheer volume of subscriptions they have to manage. The consumer-led boom in the subscription economy is hurting from constant account management and administration — from updating personal details to accessing accounts across multiple devices and creating, renewing or canceling subscriptions. 

In response to this overwhelm, content providers are rethinking how they pursue customer acquisition and retention.

How content providers are adapting to changing consumer behaviors

Consumers don’t want fewer subscriptions — they actually want more options, more categories and more variety without more hassle. More than three-quarters (78%) of U.S. consumers and 93% in APAC said they wanted a single platform for all their subscriptions. 

There is a vanguard of subscription providers that are already responding to this shift in attitude. As a recent Bango and Omdia report on telecommunications subscriptions highlights, 20% of subscription video on demand (SVOD) subscriptions are already sold through bundling partnerships with telco companies, reaching 25% by 2028. In certain regions, such as Latin America, nearly 50% of all streaming video subscriptions will come from telco bundles within the next five years.

It’s this new distribution model that represents the opportunity for content providers to respond to changing consumer attitudes and behaviors around subscription services. Recently, Verizon in the U.S. with +play and Optus in Australia with SubHub have launched platforms that address these customer concerns head-on. 

What links them both is the adoption of a new form of content service bundling — super bundling — which allows consumers to subscribe to a wide variety of services via a single content hub with one bill for easy management and content discovery. 

Super bundling creates a new marketing channel for content providers looking to drive growth. It taps into consumers demanding a new approach to managing subscription services. 

Super bundling expands content distribution while driving down acquisition costs

For content providers, super bundling means access to millions of potential customers. By being part of the super bundling revolution, not only can brands piggyback on the reach of existing high-spend brands, but they also benefit from associating with the formidable marketing power of these household names.

It is hard to understate the power of this model for content providers. Rather than relying on reaching every consumer individually, subscription services can access the whole U.S. market simply by partnering with four telcos, for example.  

And those subscription services already distributing their content through super bundling report huge commercial benefits, including increased customer acquisition, increased stickiness, reduced churn and improved relative cost per acquisition. They have found that working with telcos is an effective way to expand internationally, leveraging the existing payment relationships telcos have with their customers. 

How super bundling gives subscribers the flexibility they seek

The consumer view confirms the advantages in play. A Bango survey found that in the U.S., 70% of consumers said they would spend more time using their subscription service if it were available through a super bundling content hub. Almost two-thirds (63%) said they would sign up for more content packages if they could be managed through one platform. In APAC, 90% of subscribers said they would subscribe to more international content if they had easy access through a super bundle.

To capitalize fully on super bundling, content providers need to start to make some behavior changes of their own, starting by accepting that the perceived standard model isn’t the only way of doing things. 

Whether due to subscription fatigue or the cost-of-living crisis, subscribers are already looking for ways to take charge of how they manage and pay for their subscriptions. Users are only sticky as long as the value lasts. They are choosing the services that give them the most flexibility, giving them control over their finances and their content.

Content providers can ignore these signals, or they can embrace these behaviors through super bundling platforms that remove the frustrations and give consumers what they want.

Sponsored by Bango

https://digiday.com/?p=524655

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