Entertainment expenditure surges as consumer confidence spikes
In the ever-evolving world of entertainment, companies are adapting to the changing environment with a renewed vigour. The next phase of consumer behaviour sees streaming platforms like Netflix, social media content providers, connected gaming services, and Virtual Reality technology firms vying for audience attention. These companies are leveraging intelligent data strategies to deliver faster, personalized, and cross-platform content, better understanding user behaviour, recognizing trends early, and developing content and business models accordingly.
The UK and US lead the charge in premium adoption, while Canada has seen the sharpest growth in premium transactions. The UK and Germany, in particular, have an average of 3.3 and 2.7 streaming services per household, respectively. Anastasia Budash, Lead Analyst at Futuresource Consulting, suggests that better category promotion and overall premium release visibility could push engagement further.
The entertainment sector is experiencing a resurgence due to increased consumer confidence. According to Futuresource Consulting's latest Living With Digital international consumer research, more than 60% of households now report feeling better off or no change compared to just six months ago. With this newfound economic stability comes the potential for higher disposable income, which may increase cinema visits, content purchases, and reduce churn from subscription services.
However, cinema struggled in 2024 due to the aftermath of Hollywood strikes. But 2025 brings newfound optimism, with keeping cinema-goers, particularly younger audiences, engaged being crucial for the box office. The 26-to-45 age group remains the most committed to cinema, over-indexing across all major markets.
In the streaming industry, retention must take priority to ensure platforms become essential rather than expendable in household budgets. Tiered pricing models, including ad-supported, standard, premium, and bundled offerings, are helping to extend consumer spending while keeping services within budget.
The 46-to-65 age group is still proving the hardest to win back, requiring focused efforts and direct targeting. James Duvall, Principal Analyst at Futuresource Consulting, commented that households are reassessing their entertainment budgets. The ceiling on how many services consumers are willing to pay for has been reached, leading to increased importance of retention over acquisition.
In conclusion, the entertainment industry is at a pivotal point, with companies adapting to the changing landscape and consumers reassessing their entertainment budgets. The key to success lies in understanding consumer behaviour, delivering personalized content, and prioritizing retention over acquisition.
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