Unlocking a World of Mobile-only Plan Options!

How do people stream video content?

CONTEXT

In today's digital streaming services market, there is a multitude of competitors offering similar plans, typically encompassing both ad-supported and ad-free options. Additionally, these providers enable users to access their content libraries seamlessly by extending their services across various devices including:

1.      Smart TVs
2.      Mobile (iOS and Android)
3.      Tablets
4.      PCs

This case study delves into the question of whether Hulu should broaden its subscription options by introducing a cost-effective mobile-only subscription.

Distribution of weekly video content viewership among consumers in the United States as of December 2023, categorized by age group and device usage . Source: www.statista.com

Delivering an affordable Hulu mobile-only subscription plan with ads (and ad-free) in the market will boost subscription numbers and enhance user retention.

HYPOTHESIS

What effect will shifts in consumer behavior have on the options available in streaming services ?

THE CONSUMER MARKET

  • 88% of Gen Zs and 55% of Millennials use smartphone devices to stream video content on a weekly basis

  • Gen Z (36%) and Millennials (47%) are at the forefront in terms of daily usage of streaming services.

  • The average percentage of streaming users cite cost as the reason for canceling their subscription is 40%.

  • With housing costs soaring, the demand for alternate forms is growing, and “dorms for adults,” as co-living arrangements are often called, are on an upswing across the country. Millennials and Gen Z have a strong inclination toward sustainability and eco-consciousness, owning fewer possessions, such as televisions

What competitor’s exist and what do they offer?

  • All of the streaming service competitors provide comparable subscription plans, allowing their services to be accessed across multiple platforms, including PCs, Smart TVs, mobile devices, and tablets.

  • When it comes to subscription plans, there are no distinguishing features among the top streaming service providers.

Sources: Cord Cutter News, BusinessDIT, Statista(Netflix), Statista(Hulu)

Who are the users that would benefit from a mobile-only subscription plan?

THE AUDIENCE

Overall, both Gen Z and Millennial users exhibit similar mobile usage patterns and rely on their device for the majority of their daily tasks, including streaming video content.

Gen Z and Millennial Users

Ages: 18-35

Attitudes: 76% of Gen Z users and 68% of Millennial users prefer to stream video content on their mobile device.

Personas:
-College students
-Young/mid level professionals
-Single
-Living in college dorms (student)
-Co-living (young/mid level professional)
-Desire for disposable income for experiential lifestyle

What are the pain points that these users need addressed?

USER INSIGHTS

Users seek cost-effective subscription based options

Due to the prevalence of the subscription model in the overall digital market, and the many providers, users are continually seeking enhanced value in goods and services.

Users in co-living arrangements prefer to possess fewer belongings

A study found, there are 20% more co-living rooms in the US now than in 2020 and is only expected to grow in the coming years.

To trim expenses, the majority of this demographic, especially Gen Z and Millennials, strive to possess fewer items, including televisions, whenever possible.

Sources: Newsweek

How do these user groups view and select subscription plan?

USER JOURNEY

The process of initially subscribing to Hulu or managing an existing Hulu account will remain unchanged, with the exception of Hulu users gaining access to an additional subscription plan option

BIG TAKEAWAYS

BIG TAKEAWAYS

The leading streaming service providers offer comparable monthly subscription plans .

  1. A significant portion of the user base expressed price sensitivity when selecting a subscription plan

  2. Users in general enjoy having more subscription options

  3. The Gen Z and Millennial demographic has a preference of streaming video content exclusively on their mobile devices

  4. A rising trend among Gen Z and Millennials is embracing co-living arrangements and adopting a minimalist lifestyle, which entails owning fewer possessions such as television sets

  5. Currently, none of the streaming service providers offer a mobile-only subscription plan

Boost number of new subscribers and enhance user retention by delivering an affordable Hulu mobile- only subscription plan.

THE GOAL

What should be included in the MVP?

FEATURE PRIORITIZATION & MVP DEFINITION

For a successful pilot to be run of the mobile-only subscription, the following user stories are required to build.

  • Since this is a new subscription plan type, new and current users should be made aware of this new option on the home page.

  • Hulu users, just like the other plans, should have the option of selecting a mobile only subscription with advertisements.

  • Hulu users, just like the other plans, should have the option of selecting a mobile only subscription without advertisements.

  • Hulu needs to include the new subscription plan on the Manage Plan page, so current users will have the ability to subscribe to it.

What would the User Experience look like?

Simplified experience


New users will be presented with additional subscription plans and given the option to choose the one that best aligns with their needs.


Existing users who find it more suitable for their needs will have the opportunity to upgrade their subscription to the mobile-only plan.

Phased Rollout of Mobile-only Subscription

LAUNCH & GTM STRATEGY

We will start the phased rollout with a pilot. Throughout the pilot, we’ll be in “learn and iterate” mode. After we prove out the concept and work out the kinks, we will begin expanding.

MEASURING SUCCESS

Pilot Metrics

NORTH STAR METRIC

Average number of Hulu subscribers per month

If successful, we should experience an increased Average number of Hulu subscribers per month value because new Hulu users are subscribing to the exclusive mobile-only subscription plan.

  • New Mobile-only subscriptions per week

  • Mobile-only funnel conversion rate

  • Churn Rate (How many users cancel their subscription within a week before month-free trial elapses)

  • Usage metric (Frequency subscribers are using the new service - number of streams per user)

  • Customer Satisfaction (Perform a survey to gauge the customer satisfaction)

LEADING INDICATORS

LAGGING INDICATORS

  • ARPU Per Month

  • 3-month Customer Retention (Measure the percentage of subscribers continuing their subscription)

Average number of subscribers per month
Average conversion of current users from standard plan to mobile only plan per month

One possible unintended consequence of introducing a Mobile-only subscription plan is that potential new Hulu users within the demographic might have opted for the pricier Standard Plan had the cheaper Mobile-only option not been available. This scenario could lead to missed opportunities for additional revenue.

The second potential unintended consequence is that current Hulu subscribers on the Standard Plan might switch to the cheaper Mobile-only plan.

COUNTER METRICS

Final Thoughts

Final Thoughts

SUMMARY
In this case study, the primary objective was to determine if introducing a cost effective Mobile-only option as an additional subscription plan on Hulu could potentially increase user subscription and retention. Delivering an affordable Hulu mobile-only subscription plan with ads (and ad-free) in the market will boost subscription numbers and enhance user retention.

Currently, all of the streaming service competitors provide comparable subscription plans, allowing their services to be accessed across multiple platforms, including PCs, Smart TVs, mobile devices, and tablets.  In terms of their subscription plans structure, there are no distinguishing features among the top streaming service providers.

Market research indicates that users of content streaming services are sensitive to subscription plan costs and are increasingly favoring streaming on their mobile devices. Hulu can capitalize on this trend by utilizing its existing infrastructure to provide a distinctive option for content streaming users through a value-based mobile-only subscription plan.

As a Product Manager at Hulu, I suggest initiating a focused pilot test in a specific U.S. market to evaluate both the consumer and business impact of introducing a mobile subscription plan. By monitoring the identified key metric—the average number of Hulu subscribers per month—we can gain valuable insights into the feasibility of incorporating this option into the Hulu subscription model and guide future expansion strategies.