Home Blog 2020 What Drove the Initial Success of Disney+
Nov 25, 2019

Unraveling the Disney+ Launch

Subscribe to our blog

Originally featured by: The Digital Entertainment Group

November has been a busy month in the world of streaming services. The numbers around last week’s Disney+ launch were strong – so we took a look at what drove its initial success. Based on the latest NPD Device Ownership Trends & Profile report, consumers reported strong interest in the service with 28% saying they were extremely, very or somewhat likely to subscribe within the first year. But the data tells a more insightful story; one about viewers new to Direct-to-Consumer (DTC) video whose interests expand far beyond family programming. Here’s what we learned:

Half of the Disney+ audience is new to DTC video. As a point of reference, DTC video streaming has already surpassed an early adopter audience, with 20% of U.S. internet households subscribing directly to at least one network channel. However, while half of Disney+ subscriber interest is being generated by households that already have a DTC video subscription, for the other half, this is their foray into streaming network programming directly from the distributor. This is of tantamount importance because most DTC subscribers have communicated a zero sum game when it comes to their entertainment spend. Research shows that 73% of those planning to subscribe to additional DTC video channels intend to cut or reduce other entertainment spending to do so. It’s an audience focused on affordability and subscribing to only the specific content they want to watch. This suggests Disney+ subscribers are satisfied with the price to value ratio of the content array and as such directed their spending to the service.

It’s not just about family programming. Half (51%) of likely subscribers don’t have children under the age of 18 living in their home. This demonstrates interest that expands well beyond family programing. Indeed, half (51%) of the audience don’t even have a household member that watches a family network. Further, an overwhelming majority (76%) of these households don’t watch the Disney channel. These points dispel the myth that Disney+ is just for those that watch cartoons. They are also a testament to a launch strategy that leveraged a broad range of available programming beyond Disney such as Pixar, Marvel, Star Wars, National Geographic, The Simpsons, 21st Century FOX classics and never-before-seen original feature films and series. Finally, it suggests the upcoming HBO Max programming launch strategy is on point with consumer interests as it too is geared at a broad demo target.

Low cost of entry. Reaching a new DTC video audience and promotions such as Verizon’s Disney+ on Us facilitated success. But for other consumers, they simply do the math and determine the price is right for the programming they want. For example, someone planning to watch the Marvel movie series will cover most if not all of the $69.99 annual subscription by simply saving on film rentals. While these kind of consumer trade-offs may benefit the Disney brand, these shifts in consumption patterns have the potential to impact the transactional video business.

Availability on the right devices. Price, promotion and content need to be facilitated by reach to the right audience, in this case one focused on using TV-connected devices to stream video. To that end, Disney+ launched with availability on the top five (based on household reach) connected device platforms, Samsung TV, Roku, Fire TV, PS4 and Xbox One. That is thanks to a last minute deal with Amazon, where the service was made available on Fire TV. Otherwise the #3 TV-connected device streaming platform would’ve been missing and have left potential viewers on the outside looking in.

This launch marks a turning point where the mass market is discovering streaming video expands far beyond incumbents such as Netflix. Understanding the Disney+ launch drivers are critical as it is merely a precursor to the upcoming year when HBO Max, Peacock and Quibi come to market with competitive streaming offerings.


Upcoming Event


DEG Expo

Presentation: The Maturing D2C Landscape
Presenter:
John Buffone, Industry Analyst, Connected Intelligence 
Date: Thursday, February 25
Time: 10:30 am PT
Location: Virtual
Description: Join John Buffone as he discusses the connected experience with Susan Agliata, Director Of Business Development, OTT Partnerships, Samsung and Ben Maughan, VP New Ventures and Strategic Business Development at TiVo (Xperi).

Register Now

2021 OTT.X Spring Summit

Presentation: Retaining Viewer Engagement in 2021 and Beyond
Presenter
: John Buffone, Industry Analyst, Connected Intelligence 
Date: Tuesday, March 9
Time: 2:00 pm ET
Location: Virtual
Description: Following the accelerated migration to streaming in 2020, competition for viewer’s attention continues to grow as more services enter the market. The priority has become determining how to hold onto the audience you’ve won. We’ll explore how you can use the distribution landscape to retain viewer’s engagement as they migrate back to experiential spending.

Register Now

Stay current in your industry
SUBSCRIBE


Half of U.S. Consumers Own At Least One Smart Home Device, Reports NPD
Half of U.S. Consumers Own At Least One Smart Home Device, Reports NPD

According to NPD, half of U.S. consumers own at least one smart home device, up from 35% in January of 2020. While security cameras remain the most commonly owned smart home device, the largest sales gains in 2020 were seen in security systems, smart garage door openers, and smart lighting.

Downsizing Smartly
Downsizing Smartly

NPD Connected Intelligence President, Eddie Hold, takes a look at how renting vs. buying impacts smart home device ownership and usage.

NPD Forecast: Canadian Consumer Technology Sales in 2020 Hit Record Highs as the Industry Prepares for Post Pandemic Expansion
NPD Forecast: Canadian Consumer Technology Sales in 2020 Hit Record Highs as the Industry Prepares for Post Pandemic Expansion

2020 was a year of historic growth for the Canadian consumer technology industry with sales up 18% totaling $11.1 billion, according to The NPD Group.

“Avatar: The Last Airbender” Topped US List of Animated Kids Shows on Netflix  in 2020, The NPD Group Says
“Avatar: The Last Airbender” Topped US List of Animated Kids Shows on Netflix in 2020, The NPD Group Says

The popular animated TV series, “Avatar: The Last Airbender,” led the list of children’s TV series programming viewed most on Netflix in the United States in 2020, followed by the Netflix-produced “The Boss Baby: Back in Business,” and “Naruto.”

Newsletter

Subscribe and get key market trends and insights relevant to your industry each month.

We will not sell your information. View privacy notice. | Cookie Settings