"Stranger Things" (Netflix)
A mini wave of consumer products released by video-streaming services hit the market in the second half of last year. However, November 2021 data from Morning Consult showed that most adults in the United States were not interested in products referencing shows from six major streamers. Now, new Morning Consult research underscores potentially overlooked opportunities for brands to focus their merchandising strategies to appeal to Gen Z in particular.
According to data from May, 64% of Gen Z adults said they are “very interested” or “somewhat interested” in products that reference original series and movies from video-streaming services such as Netflix, HBO Max and Hulu — a significantly higher share than for the general population. The older the surveyed age group, meanwhile, the less interest respondents expressed in products tied to streaming services’ original content.
“This suggests streamers’ branded products should be heavily marketed toward Gen Z adults, and also hints at how nonvideo content products like clothing could be another avenue for boosting awareness of an SVOD’s high-profile series or movie among young consumers. Furthermore, a refocused (or brand-new) SVOD-related product push would fit into the revenue diversification journey that many streamers have embarked on in light of Netflix proving how unpredictable subscription revenue growth can be from quarter to quarter,” said Kevin Tran, Media and Entertainment Analyst at Morning Consult.
The data begs the question about why have SVOD platforms like Netflix or Hulu not touted the success of their product pushes if younger consumers are so interested in merchandise from their favorite shows. According to Morning Consult, the main reason is that awareness of such branded products is weak. In fact, November data shows that 84% of US adults had heard “not much” or “nothing at all” about Netflix’s effort to sell goods tied to its content, though that figure climbed to 69% for Gen Z adults.
Moreover, Morning Consult noted that buying SVOD-branded products is a circuitous process. Currently, many would-be customers have to go out of their way to search for an entertainment company’s online shop for branded goods and enter their credit card information at checkout — and that is assuming they even know that such shops exist.
“To remedy this awareness gap, streamers should introduce tabs on their mobile apps that let users buy products without leaving the platforms. Companies already have users’ credit card information and could easily facilitate impulse purchases that Gen Z adults and millennials — who also have higher interest in SVOD-related products — would not otherwise make if they had to seek out such goods elsewhere and re-enter their purchase information, an extra hurdle that encourages cart abandonment,” Tran noted
Netflix and Disney+ have particularly strong reach among Gen Z and, therefore, have an opportunity to win over young fans of their branded products. Among the Gen Z adults surveyed, 75% and 61% said they or someone in their household subscribes to Netflix and Disney+, respectively. No other video-streaming service had comparable figures.
The survey was conducted on May 26-28, 2022, among a representative sample of 270 Gen Z adults in the United States, with an unweighted margin of error of +/-6 percentage points. Figures may not add up to 100% due to rounding.