Samsung Ads Canada published its Streaming Index: What Churn Means For Advertisers report today, analyzing Q2 2023 data from opted-in Samsung smart TVs to provide insight into streaming app viewing behaviour.
Not surprisingly, the report indicates that Canadians continue to shift their viewing to streaming services (up 5% from Q2 2022), with the split being 70% streaming and 30% linear.
Canada’s “streaming service churn index” is reportedly a three, versus a seven in the U.S.
“[This means] that for every active user [that] streaming apps have in a given month, there were seven viewers who used that app in the prior year, but have since churned out,” explains Justin Fromm, head of insights for Samsung Ads. So, in Canada, in any given month streaming providers are at risk of losing one in three users.
“While most of the focus on churn is about users unsubscribing, that’s of less importance to us when we talk to our partners,” Fromm adds. “Our analysis is based on actual app usage, using our device-level data. For example, we know that if a user is inactive for four months, they’re very unlikely to return. Whether they unsubscribe immediately or not, the effect is similar.”
Fromm says his team was surprised that the churn ratio in Canada is so much lower than that of the U.S.
“While that was initially surprising, [it makes sense as] there are fewer apps in the Canadian ecosystem and the adoption of streaming trails that of the U.S.,” he says. “We expect to see an increase in the churn ratio over the next several quarters and the need for streaming app marketers to include a retention strategy in their marketing efforts, right alongside their acquisition efforts.”
While new users grow scale for streaming providers, retained users drive long-term success, adds Fromm. “While retained users make up 66% of all users, they account for 84% of all time spent in the app.”
The report also suggests that, as Canadians shift from linear to streaming services, “they are exploring the options available to them. Not all apps provide what viewers are looking for.” The availability of on-demand viewing “means that viewers’ focus is less on streaming brands and more on shows,” Fromm explains. “They may use an app to watch a particular show and then not open that app again until a new season arrives.”
Fromm suggests that, as streaming becomes the norm, “[platform] advertisers need to better understand how viewers are adapting their behaviours,” and should shift their focus from demographics to audience targeting.
Competition for attention is fierce, he says. Acquisition is just the first step. While new streaming viewers are important, “services need to continue communicating their value proposition, even after the app discovery process,” to encourage continued use and retention.
Samsung Ads’ analysis is based on its full Smart TV footprint of 5.5 million TVs in Canada. Of those TVs, 79% are active streamers.
