Do satisfaction and satiation both drive immediate and delayed subscription cancellation? Implications for subscription video-on-demand services

Abstract

Subscription video-on-demand (SVoD) services are facing a continuous increase in cancellation rates. To tackle this challenge, this study investigates how platform satisfaction and content satiation affect consumer's perceived value, which ultimately determines the cancellation decision. We use data from consumers of SVoD (n = 465). A moderated mediation analysis analyzes the interplay of platform satisfaction, perceived value and content satiation in immediate (vs delayed) cancellation decisions. Our findings show that perceived value and content satiation are the early predictors of subscription cancellation. Surprisingly, satisfaction with the platform is not a sufficient antecedent of cancellation, whereas competitors' attractiveness accelerates this decision. Satiated consumers consider a delayed cancellation of their subscription because of a gradual decline in their perception of future utility. This suggests that they are able to infer future satiation and discount their expectations when making a subscription cancellation decision. We provide actionable recommendations for platforms to retain consumers: to periodically advance their future releases and to effectively communicate the variety of their content. Platforms should also be vigilant of competitors' acquisition strategies since these penalize consumer perceived value, which accelerates cancellation.