In 2022, the number of cinema visits in Sweden is still 5.5 million lower than 2019, the year before Covid. This is shown by statistics from the Swedish Cinema Owners Association. Buying or renting video online, TVOD, on the other hand, grew strongly in Sweden last year. Close to 30 percent of Swedish households have rented or bought content this way an average month in 2022. This is a new record for TVOD in Sweden.
An average month in 2022, 28 percent of the Swedish households rented or bought TVOD content. TVOD is an abbreviation of “transactional video on demand”, which is the digital streaming service for what used to be “video rental store”. Compared to 2021, TVOD has grown with 15 percent which is a new record level. This also means that household spend on TVOD has increased by nearly six percent compared to 2021. This is shown in Mediavision’s latest analysis of the Swedish TV & Streaming market.
The average monthly spend for households that bought/rented video online was SEK 145 in 2022. Movies is what most households rent, unlike other paid streaming services where series is the most popular content.
– Although cinema seems to be recovering, it is still some far from the numbers before the pandemic. For TVOD, on the other hand, 2022 meant record growth. The fact that many major titles were launched on subscription SVOD services (such as Netflix, Viaplay or Disney) during last year does not seem to have had a negative impact on the development, comments Marie Nilsson, CEO at Mediavision. Consumers clearly appreciate the digital rental services and, unlike cinema, they do not seem to think that the supply has been negatively affected by the pandemic.
Swedish media is mainly financed by advertising and consumer payments. The advertising market is largely affected in an economic downturn. However, Mediavision can show that households’ interest in paying for media, for example through subscriptions, continues to increase – despite the economic decline. For many media companies, consumer revenues will increase in importance if Sweden enters a recession.
Swedish household media spend has gradually increased and despite economic concerns, 2022 was no exception. Average media spend increased 8 percent compared to 2021, and now amounts to SEK 685 per month. Looking across the three main categories text, audio and video1, audio services increased the most, with a whopping 12 percent. At the same time, text grew by 5 percent and video by 9 percent compared to 2021. For the advertising market, development was significantly weaker and, according to IRM, a decrease of just over 2 percent was noted in the last quarter of the year, compared to the same period in 2021.
For advertising revenue in 2023, IRM expects a continued decline of 0.7 percent. For consumer payments, Mediavision currently sees no signs of a similar decline. On the contrary, preliminary data for the first months of the year shows continued growth. Bottom line is that consumer payments are stable or increasing, despite economic instability. When consumers are asked about their plans in financially tougher times, other expenses than media are opted out first.
– We recognize this pattern from previous economic downturns. Household spend on media is more stable than advertising revenue, comments Marie Nilsson, CEO at Mediavision. Therefore, it is particularly important in these times to closely monitor, for example, customer satisfaction and price sensitivity. Bundling different types of media services can also be a way to strengthen the relationship with consumers.
¹Text: Digital/printed newspapers, magazines and books (subscription and purchase per unit) Audio: audiobooks, music and podcasts (subscription and purchase per unit) Video: Trad. TV, SVOD, TVOD, cinema and DVD/Blu-ray.