When consumers facing financial pressures carve out room in their budgets to treat themselves, PYMNTS Intelligence research reveals, it is often to enjoy their favorite movies and series.
The “The Nonessential Spending Deep Dive Edition” of the “New Reality Check: The Paycheck-to-Paycheck Report” series, a PYMNTS Intelligence and LendingClub collaboration, draws on insights from a July survey of more than 3,400 U.S. consumers to dig into the impact of nonessential spending on shoppers’ ability to manage expenses and put aside savings.
The results revealed that, among consumers who live paycheck to paycheck with issues paying bills, 29% say that their spending on streaming services has been indulgent, making this one of the most common splurges for these cash-strapped shoppers. The indulgence ranked below only food from full-service restaurants as a key strain on consumers in this demographic’s budgets.
Indeed, streaming services are becoming more of a financial burden for many consumers as they continue to raise their prices. Netflix shared earlier this year that it is cutting its lowest-cost, advertisement-free tier in select markets, a move that comes as streaming platforms look to drive more revenue per subscriber both through ad sales and price increases.
“The ads plan now accounts for 40% of all Netflix sign-ups in our ads markets and we’re looking to retire our Basic plan in some of our ads countries, starting with Canada and the UK in Q2 and taking it from there,” the company stated in a letter to shareholders accompanying its fourth-quarter 2023 earnings results.
Amazon Prime Video, meanwhile, implemented a new $2.99/month charge earlier this year for ad-free viewing, otherwise integrating advertisement breaks into its content. Plus, throughout last year, key players in the space including Disney+, Warner Bros. Discovery’s Max, and YouTube TV Premium increased their prices as well.
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