Study: 39% of Netflix users are likely to leave due to price increases

According to Indiewire, a recent study by consumer analytics platform CivicScience found that approximately 39% of all Netflix users would “most likely” cancel their subscription entirely if Netflix raised the price of ad-free slots. is the answer.

Additionally, 31% said they would most likely downgrade their subscription to ad-supported Netflix, and only 29% said they would keep their subscription to ad-free Netflix.

Civic Science surveyed nearly 4,000 U.S. respondents in a survey conducted earlier this week that found Netflix is ​​considering raising monthly fees for ad-free users after the SAG strike ends. This was just days after the Wall Street Journal reported.

But what’s not clear here is the question of “price elasticity,” according to Wedbush Securities analyst Alicia Reese. She said the study did not adequately address how large the price increases would be, meaning that a $1 increase in prices is likely to cause a much smaller outflow, she said, than a $5 increase. Pointed out.

She added that streamers themselves are aware of this and already have good insight into the economics that users will tolerate. Please raise your prices. ”

Following the WSJ report, Netflix co-CEO Ted Sarandos responded to the news at a Bloomberg ScreenTime event this week, saying he has “nothing new to announce” regarding price increases. Ta.

A previous study conducted by Civic Science in August found that the cost of living and inflation are having a full impact on the number of streaming subscribers, with one in three U.S. adults having cut back on their streaming subscription spending. It turns out that there are plans to reduce it.

The percentage of people with four or more streaming subscriptions each month has also steadily declined over the year.

The report comes after Netflix announced (via Variety) plans to open its first two permanent brick-and-mortar stores in the U.S. in 2024. The retail store is being described as a mini-theme park and will sell merchandise, food and beverages, and “immersive” installations based on hit shows such as “The Squid Game” and “Stranger Things.”