With inflation soaring to record highs, industries across the board are feeling the pain, and Hollywood is no exception! While we may not be officially in a recession, we are certainly in a bear market, and it is taking a huge bite out of the entertainment industry.
Entertainment is taking a big hit!
According to Variety, people are slashing spending on escapism. Just behind going out to eat, consumers are cutting back the most on entertainment and travel. This is according to a survey conducted by Morning Consult in partnership with Variety Intelligence Platform (VIP+).
The survey, which polled 2,200 U.S. adults, found that consumer sentiment for entertainment was waning amid economic woes. This is in stark contrast to previous recessionary periods where the entertainment industry has held its own fairly well.
Is the era of streaming services coming to an end?
Streaming services, which became entertainment bedrocks during the Covid-19 pandemic, are now on the chopping block. According to the survey, 26% of people said they have already made significant changes in their streaming subscriptions including Netflix, Spotify, and Hulu. Over half of the adults polled said they will continue to pay for streaming services despite higher prices, while 39% said they would consider cancelling. That is no small number!
Millennials and Gen Zers are tuning out!
In the survey, Gen Zers and Millennials were the most likely to lower spending for streaming services, 36% and 35%, respectively. That is a total of 71%!
This may lead services such as Netflix and Disney + to create a more affordable, ad-supported option that is more accessible to these younger demographics. Not to mention, making changes in the content itself to have more appeal to a younger audience.
The future of entertainment in a bear market…
There is no sign that the bear is going back into the cave anytime soon, and the gloomy fog of inflation still looms overhead. Companies like Netflix will be reporting Q2 earnings very soon, shedding more light on the state of streaming services. Will the future of entertainment be bleak in the coming months and years ahead, or will it adapt and give way to radical innovation? Only time will tell.
