Five on Friday: Prime, Petitions and Paying for News

Featuring Care by Volvo, Amazon, App Annie and BritBox

Five on Friday: Prime

Source: Bigstock Photo

If you’re tired of hearing the political rhetoric of the federal government shutdown, we’ve got some interesting subscription updates to distract you. In this week’s edition of Five on Friday, California car dealers are filing a petition against Care by Volvo, we take a look at the future of Amazon Prime, App Annie shares the State of Mobile for 2019, Twipe looks at readers’ willingness to pay for news, and BBC and ITV’s BritBox are planning more original content, now that BritBox has reached 500,000 subscribers.

 

 

California Dealers File Petition against Volvo for Subscription Service

 Petitions and Paying for News

Source: Volvo

California auto dealers are not happy with Volvo and their Care by Volvo subscription service, reports TheDrive.com. The California New Dealers Association, which represents more than 1,000 car and truck dealers, has filed a petition with California’s New Motor Vehicle Board to claim that the subscription offering threatens the business model that franchised auto dealers have come to depend on.

The petition claims that “Volvo’s characterization of CbV as a ‘subscription’ is a clever, but illegal, marketing ploy.” The CNDA alleges that what Volvo is really “selling” is a two-year lease available for an all-inclusive, fixed monthly fee that covers the vehicle cost, insurance, maintenance, roadside assistance and normal wear-and-tear.

The CNDA’s petition also states that the Care by Volvo subscription service “constitutes illegal competition between manufacturer and dealer” and “usurps the traditional sales role of Volvo dealer franchisees.” For relief, the CNDA asks the Board to conduct an investigation and provide a written report or order the DMV to initiate disciplinary proceedings against Volvo, if the investigation supports the CNDA’s claims.

Read more at TheDrive.com or read the full petition on Scribd.

Monthly Payment Option Helped Amazon Prime Surpass 100 Million Members 

Five on Friday: Prime

Source: Amazon

According to The Motley Fool, Amazon Prime surpassed 100 million members last year, representing growth of about 10 percent last year. The Motley Fool speculates that the primary factor driving Amazon Prime’s growth is the company’s monthly subscription option, introduced in April 2016. Prior to that Prime members had to dole out the full annual subscription price of $99 (it is now $119 a year).

At launch, the monthly payment plan cost Prime members $10.99, or $131.88 per year. The new monthly cost is $12.99, or $155.88 per year. Members are paying more for the privilege of paying monthly. The Motley Fool reports that, within a year of offering the monthly payment option, 25 percent of Prime members chose that option. At the end of last year, 36 percent of members were paying monthly.  

Can growth grow at this pace, or will it level off? While initially it provided a boost to revenue and a more affordable entry point for Prime members, the change did little to encourage members to stick around. After all, if a member just wanted free shipping for a large ticket item or access to Prime to see the latest season of The Man in the High Castle or The Marvelous Mrs. Maisel, they could pay the fee for one month and then bail.

For the power shopper and TV aficionado, Amazon Prime will be attractive regardless of price. Don’t tell Jeff Bezos this, but I would keep my Prime membership even if the price doubled. I watch Prime Video almost every week, and I am a regular Amazon Fresh and Amazon shopper. I’ve even tried Amazon Pantry and Prime Now. Though I was not impressed with either of the latter services, Amazon Fresh, Amazon Prime, free shipping and all of the other perks of an Amazon membership make it worth my while – a huge saving in terms of time and money. But I may not be the average shopper.

Business Insider offered another take on Prime’s success, stating that it believes Prime is going to soon lose its free two-day shipping advantage. Other companies are offering a similar deal, and companies like Walmart are stepping up their home delivery game. Free two-day shipping is becoming the norm rather than the exception. To keep its competitive edge, Amazon needs to keep its other Prime perks in place and continue to deliver – literally and figuratively – to loyal customers to keep us interested.

Highlights from App Annie’s 2018 State of Mobile Report

In a fascinating report, App Annie shares the state of mobile for the year 2019. Though some of the information was consistent with App Annie’s 2016 report, there were a few surprises (like the fact that those 25+ accessed games more often than Gen Zers!) Here are a few highlights:

  • In 2018, there were 194 billion downloads of mobile apps worldwide, a 35 percent increase from 2016.
  • Nearly 50 percent of mobile downloads occurred in China on both iOS and Android devices.
  • Non-gaming apps accounted for 65 percent of app downloads in 2018.
  • Consumers spent $101 billion on mobile apps last year, a 75 percent increase from 2016.
  • Games made up 74 percent of the money spent in app stores.
  • The average consumer in the U.S. has more than 100 apps on their smartphone.
  • Gen Z (ages 16 to 24) engaged more on average with non-gaming apps than those 25 and older.
  • Users 25 and older spend 75 percent more time monthly on their most used games and they accessed them 50 percent more often than Gen Z.
  • The top paid apps in 2018 were Netflix, Tinder, Tencent Video, QIY! and Pandora Music.

Bottom line: apps are growing in popularity. Consumers are using them much more often and are willing to pay for their favorite apps, making them ripe for the subscription model. Download the complete report from App Annie.

 Petitions and Paying for News

Source: Bigstock Photo

Why Readers Will – and Won’t – Pay for Online News

Five on Friday: Prime

Source: Bigstock Photo

There have been many studies on whether or not readers are willing to pay for news. The answer – it depends. In a study of 4,000 news consumers in Europe and the U.S., Twipe shares some interesting insights.

Here are some reasons why people won’t pay for online news.

  • 61.9 percent of study participants said they won’t pay for digital news because they can find free content elsewhere. Twipe concludes that this is the biggest obstacle for media companies to overcome when trying to monetize digital news.
  • 24.2 percent of respondents said that online news is too expensive, and 17.8 percent said they are not interested in the content enough to pay for it.
  • Despite what you might hear about “fake news,” only 6.8 percent said they don’t pay for news because they don’t trust the media.
  • 5.1 percent said they are too busy to use an online subscription. I can relate to this one. I subscribe to one of the most well-known, most-respected newspapers in the world, and I don’t read enough articles on the site to hit the paywall each month.

Here are some reasons why they will pay for online news:

  • 30.6 percent couldn’t get news in a particular format anywhere else.
  • 18.9 percent want a news source that covers a particular topic or issue, and 18.2 percent subscribed because they got a good deal.
  • 11.7 percent subscribed because they hit a paywall, and 7.8 percent subscribed because they saw it on social media.
  • 6.8 percent subscribed when they could get their employers to pay for it.

Read more insights and download the full report from TwipeMobile.com.

Two-year-old BritBox to Invest in Content to Appeal to its 500K Subscribers 

The two-year-old streaming subscription service BritBox has hit an important milestone, reports Digiday. The niche service, which is co-owned by BBC Studios and ITV, caters to fans of British TV and movies. To date, BritBox has attracted more than 500,000 paying subscribers with original shows like “Bletchley Circle: San Francisco” and licensed programs like “Shetland,” “Fawlty Towers,” “Absolutely Fabulous” and “Doctor Who.”

BritBox offers monthly and annual subscription plans, available after a seven-day free trial. In the U.S., the service is $6.99 a month or $69.99 a year. In Canada, the service $8.99 a month or $89.99 a year, in Canadian dollars. With a subscription, subscribers get unlimited access to a wide range of content. Viewers can sign up directly through BritBox, or via the Amazon Prime Channels BritBox.

According to Digiday, BritBox saw success with its first series – “Bletchley Circle” – and plans to commission more original series and form other partnerships to offer exclusive content. From its data collection efforts, BritBox has appealed to women 45 and over in the South or the Midwest (of the United States), so this could be a potential audience for them to target.

I fall into that category, and I stumbled across BritBox through the Amazon Prime Channels dashboard. During my free trial, I watched several of its programs, including “Bletchley Circle” and “DSI Bancroft,” and continued to subscribe for several months thereafter. I wasn’t familiar with a lot of the programming, but I enjoyed the shows I watched during that time. I would subscribe again – particularly with the annual subscription fee.

Streaming services – whether free or paid – are growing in popularity and BBC and ITV want their slice. BritBox is a great starting point for them, and with at least $35 million in estimated revenue ($69.99 x 500,000), they have a little money to spend. I can’t wait to see what they offer next! Read more about BritBox on Digiday.

 Petitions and Paying for News

Source: Britbox

 

 

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