2021 UK Consumer Insights survey: pre-pandemic entertainment trends return

Introduction

Even though the COVID-19 pandemic is still not in the rearview mirror, consumer behavior showed signs of returning to pre-pandemic patterns during 2021. Data collected from the recently completed Kagan 2021 U.K. Consumer Insights survey shows that the use of digital entertainment declined substantially last year compared to 2020 but remained slightly higher than 2019 totals across many metrics.

* Average daily hours spent on digital entertainment receded in last year from the height of the pandemic in 2020.

* While overall use of SVOD services remained flat year over year, the average number of SVOD services used per household declined slightly.

* U.K. consumers continue to spend the majority of their daily VOD viewing time watching Netflix and Amazon Prime Video.

A good example of this up-down multiyear trend can be seen in daily hours of digital entertainment consumption. The historical survey reveals that in 2020, due to pandemic-related lockdowns and office closures, U.K. consumers spent an average of 7.7 hours per day on digital entertainment, a substantial increase from 6.5 hours in 2019. Time spent on TV/video, music and especially gaming in 2020 all showed increases from the previous year. During 2021, as many consumers spent less time at home, the use of digital entertainment receded to slightly above pre-pandemic levels (6.7 hours per day on average).

Historical survey data shows that the market for multichannel TV services in the U.K. remains strong. Since 2017 overall multichannel TV penetration has dropped only six percentage points to 59% at the end of 2021. As a result of the pandemic, multichannel TV subscriber households rose very slightly during 2020 but dropped in 2021 to pre-pandemic levels. The survey data shows that the percentage of video cord nevers (never subscribed to pay TV) rose slightly during 2021, while video cord cutters (who have dropped a pay TV subscription) remained flat year over year. This reflects a relatively small number of pay TV households that dropped their service subscriptions this past year.

Overall adoption of online subscription video services, or SVOD, plateaued in 2020 and 2021, reaching 81% and 82% of surveyed internet households, respectively. This suggests that SVOD adoption in the U.K. may have peaked. Online video rentals gave up much of the gains experienced during the height of the pandemic, falling 5 percentage points from 2020 totals to 49%. Cinema attendance, historically near 70%, dropped precipitously during 2020 to 48% but rebounded in 2021 to 57%.

Survey results for SVOD stacking provide further evidence of a return to pre-pandemic norms in the U.K. Overall, the number of SVOD services used by U.K. internet households rose from an average of 1.5 services in 2019 to 2.2 SVOD services in 2020, followed by a decline to 1.9 SVOD services in 2021. The average number of SVOD services used by Amazon Prime Video, Netflix, Disney+ and Now TV viewers shows an identical historic trend.

The 2021 U.K. Consumer Insights survey also highlighted the dominance of Netflix Inc. and Amazon.com Inc.'s Prime Video in the SVOD market. The survey found that among Netflix subscribers, half of their average daily VOD viewing time is spent watching Netflix content. For Amazon Prime Video subscribers, who also typically use three SVOD services, 38% of their average daily VOD viewing time is spent using the service. The data shows that the third or fourth SVOD service subscribed to (often Walt Disney Co.'s Disney+, Now TV or BritBox) typically receives less than 30% of average daily VOD viewing time.

The historical survey data also shows that mobile gaming, online gaming, video disc rentals and paid music subscriptions grew substantially in 2020, followed by a return to near pre-pandemic levels in 2021.

^{The 2021 Kagan European Consumer Insights surveys were conducted during December 2021 with approximately 1,000 internet adults per country in the U.K., France, Germany, Italy, Sweden and Poland. Each survey has a margin of error of +/-3 ppts at the 95% confidence level. Percentages are rounded up to the nearest whole number. Survey data should only be used to identify general market characteristics and directional trends.}

^{Consumer Insights is a regular feature from Kagan, a group within S&P Global Market Intelligence's TMT offering, providing exclusive research and commentary.}