“I learned that it is better to do one product well than two products in a mediocre way.” – Reed Hastings
Throughout the COVID-19 crisis, consumers have increasingly turned to streaming video from inside their homes.
Netflix (NFLX) experienced accelerated membership growth earlier this year as a result of home confinement, while recently launched streaming services like Disney+ (DIS) and Apple TV+ (AAPL) also gained traction.
However, when it comes to a seamless experience, Netflix leads the way. In a study by J.D. Power, out of the main streaming providers Netflix experienced the least problems per hour watched at 0.07, followed by Hulu at 0.11.
User Experience Driving Value
When Analyzing businesses, the user experience is an aspect that is often overlooked. Frequent technology issues is one of the many factors that can hurt the user experience. A poor user experience can impact engagement and ultimately reduce the lifetime value (LTV) of a customer.
On the other hand, a best-in-breed experience has the power to keep customers engaged and subscribed for a longer period. Together with other factors this can result in a higher LTV.
As society transitions into reopening, this period will likely have been an opportunity for companies to acquire new customers. It will be interesting to see which services are able to retain their recently added users and which trends were only temporary.
Twitter: @_SeanDavid
Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.
