Research finds ‘deals’ lure subscribers back to pay TV

With pay-TV providers continuing to lose subscribers to over-the-top offerings like Netflix and Hulu, the question in the C-suite has to be “How do we keep/get back those former subscribers ” Turns out, that’s a pretty simple proposition: Bribe them.

New research posits that 44 percent of customers who re-subscribed to pay-TV services in the past 18 months said a promotion offering free or discounted channels was a significant reason for their return. Of course, the bad news is that they didn’t come back because they were dissatisfied with the faux pay-TV service from OTT providers like Netflix.

Many cord cutters drop pay-TV services because of economic factors, or shave the extent of their premium channels to save a few dollars. “They are not dissatisfied with Internet video,” said Joihn Barrett, director of consumer research at Parks Associates. “In fact, many cited Netflix Watch Instantly as a very satisfying experience. These re-subscribers were simply ready to take advantage of a promotion as their own financial situation improved.”

While the promotions bring them back, it would be interesting to determine just how sticky they are, and what proportion of these deal-shopping customers stay after the promotion runs out; how heavy is that churn?  And, of course, what’s it do to subscriber acquisition costs?