Study reveals that streaming users cancel subscriptions when they feel the service is less valuable.
Despite satisfaction with the subscription, content fatigue lowers users' expectations of future enjoyment.
Platforms could reduce cancellations by highlighting the variety of existing and upcoming content
Even with 1.8 billion video streaming subscriptions worldwide , many services are seeing cancellation rates steadily rise - raising the question of why.
An international study , published in the Journal of Retailing and Consumer Services, explores how platform satisfaction and content satiation - feeling overwhelmed or bored - shapes how worthwhile users think a service is, ultimately influencing subscription cancellation decisions.
Using data from 465 subscribers, the study, which was carried out in Spain, examined customers with active subscriptions to five major streaming platforms - Amazon Prime Video, Apple TV+, Disney+, HBO Max, and Netflix.
The findings show that how valuable users perceive a service to be and how satiated they are (i.e. whether they feel overloaded with content) are early warning signs of cancellation. Interestingly, satisfaction with the platform alone is not enough to prevent users from leaving, and attractive alternatives offered by competitors can even accelerate the switching.
Researchers also found that nearly half of subscription cancellation variation can be explained by platform satisfaction, content fatigue - also known as satiation - and how worthwhile users feel the service is. This highlights that both short-term and long-term decisions to cancel are closely linked to how satisfied users feel.
However, whether users are becoming bored or overwhelmed by content is the strongest indicator of imminent cancellations. In the long-term, users anticipate future content boredom, lessening how much value they believe the service offers.
Dr Marta Nieto-Garcia , from the University of Portsmouth's School of Strategy, Marketing and Innovation , said: "The idea for this research came from a general interest in service marketing and how consumers become used to their experiences over time. We already know from areas like hospitality that consumers who feel saturated or bored make different decisions, so we wanted to see whether the same effect exists in subscription markets.
"With the rapid growth of subscriptions, especially video-on-demand services after COVID, this felt like an important and timely area to explore."
To keep users engaged, the study emphasises how platforms should clearly highlight the variety of existing and upcoming content and release new content regularly. It also highlights the importance of keeping users engaged through strategies like creating a community, offering membership perks, or providing loyalty rewards to remain competitive.
Lead author Ismael Becerril-Castrillejo from the Department of Economics and Business Administration at the University of Burgos in Spain, added: "People take satisfaction for granted and expect it as a baseline. What really drives whether they continue is a mix of factors - how overloaded individuals feel with content and how attractive competitors' offers are.
"For example, someone might unsubscribe from Netflix if Amazon offers a deal that makes them think the grass is greener elsewhere. Continuing a subscription isn't just about satisfaction, it also depends on competitors, time effects, the subjective enjoyment of the content users has consumed, and the potential enhancement from new releases."
Pablo A. Muñoz-Gallego from the University of Salamanca, IME Business School, said: "I recognised the need to monitor competitors' strategies, as attractive alternatives can make users feel they're not getting enough value from their existing service, which can lead them to cancel."
