At the peak of the global pandemic, with businesses across industries taking hit after financial hit in the wake of a global lockdown, hard as it is to admit subscription-driven businesses across a range of industries expanded at a rate of 12% in the second quarter of 2020.
In the entertainment streaming sector alone, Netflix netted 10 million new subscribers in the wake of the pandemic, while rival Disney+ clocked 60.5 million subscribers in just 9 months of being launched.
This data, considering the unique – arguably never-before-seen – variable of the global pandemic, can be dismissed as a one-off anomaly, perhaps doubly uncharacteristic for such a devastating interlude in the new millennia.
Yet there is a trend with digital content, whether on Netflix, Disney+, Iroko TV, or YouTube that can be said to have begun to trickle into other sectors of the economy which business owners, brands, as well as content creators in Nigeria can benefit from understanding how to partake in.
Consumers are increasingly willing to purchase a subscription plan to enjoy a specific kind of content, get a particular quality of content, or access perks that make them feel special to the brand.
In a country that is as popular for its entertainment export – in the form of Nollywood movies and the music industry’s output – as for its notorious piracy problem, it is easy to struggle to see how subscription-based content can fare better.
Why pay for something if you know you can access it one illegal way or another?
Yet, on the surface, that is what YouTube – with its 2 billion users, 50 million of whom are paid subscribers across its suite of paid services – is doing. The appeal of YouTube has always been that it offers music, pranks, trailers, comedy, vlogs, and other sundry clips that include a ton of tutorials on everything from sewing a button to building a dam FOR FREE.
Of course, FREE is relative, and if nothing else has pressed this home for users of YouTube, the company’s reported 83% year-over-year increase in revenue from ads in the 2nd quarter of the pandemic year should.
Transactions, in the end, are a give and take however you look at them.
The 50 million users willing to pay to bypass ads and get access to other premium features on YouTube are far from suckers, as many a Nigerian may feel the impulse to declare. The foundation of subscription-based services is value. And it appears even Nigerians agree with that.
What the streets are saying
In a Culture Intelligence from RED survey seeking to establish what, if anything, could motivate Nigerians aged 20 to 35 to pay for subscription-based content, 50% revealed loyalty to a particular creator or attachment to a specific content is a great motivator.
Quality of content, though another motivator, is split in half between those willing to pay better quality and those who will only do so if there are added perks they can look forward to beyond that. Which figures considering the vast majority of available local media content is far below global standard yet nevertheless widely consumed and loved.
84% of respondents will pay to get access to exclusive content, but 16% of that number will only do so ‘depending on what the content is’. Another 16% are flat out unbothered with the exclusivity of content.
Further wading into the waters of loyalty, the study found that 50% of respondents could consider paying to access the content of their favourite creator if the subscription is personalized down to the creator level. 16% are certain that they would. Whereas 34% won’t even consider the idea.
This says something about subscription-based business models, and it also says something about the future of content consumption for a growing number of consumers.
As creators continue to seek greater freedom to create and directly benefit financially from their talent, as brands seek better ways to deliver customized service to their customers, subscription-based business models may be the way to go.
When Gartner predicted that 75% of organizations selling direct to consumers will offer subscription services by 2023, it may have been hanging on a prophecy.