Do subscription streaming services need a loyalty program?
13 February 2023
Stacey Lyons

The question about whether subscription streaming services could benefit from a loyalty program pops into my head daily (yes, I’m a loser). I’m constantly asking myself questions for work and personally in relation to this, such as:

  1. Is delivering value through personalisation enough?
  2. Should I unsubscribe from my own account when there’s nothing I’m watching and re-subscriber later?
  3. Would these companies be a good potential future client for Loyalty & Reward Co?

I thought it was time to actually sit down and answer these questions so I can move on with my life…

Is delivering value through personalisation enough?

Customers now expect ultra-personalisation, convenience and value. And this has actually been framed by the best-in-class service experience they receive from subscription streaming companies like Netflix, Stan, and Spotify.

These companies collect lots of personal and browsing data, and effectively leverage technology and AI to enable that data, in order to deliver greater profiling, improve efficiencies and drive omnichannel personalisation. This has resulted in the ability to deliver a curated homepage and thumbnails, recommended content and personalised communications, ensuring every customer is exposed to content most valuable and relevant to them at the optimal time via the optimal channel, therefore maximising the hours spent consuming content on these platforms.

These companies have really set a new standard in terms of the level of personalisation they provide but alone, is this enough to drive lasting loyalty? Some research shows that it may not be.

  • Personalisation is now an expectation, with 78% of customers frustrated when they don’t receive it [1]. Meeting and even exceeding expectations is great, but lasting loyalty is delivered by delighting customers at every touchpoint
  • Consumers want to be rewarded for their data and rewarded for their loyalty [2]. Convenience and personalisation are something most customers would not consider to be a reward
  • Consumers are ‘increasingly aware of the value of their personal data’ and would put a price tag from $50 (Australia) to $70 (Germany) to $120 (South Korea) on their personal data if they could [3]. Customers understand that their data is part of a value exchange. A structured program with a clear and tangible value exchange may be more desirable to customers and would help create exit barriers

Should I unsubscribe from my own account when there’s nothing I’m watching and re-subscriber later?

Subscription streaming services are not delivering a reason not to do this. i.e., There’s no negative consequence whatsoever for cancelling.

In fact, the current structure actually makes unsubscribing a more attractive option in a way. This is because if I unsubscribe, I don’t pay when I don’t watch it, and I’ll get hit with an attractive Winback offer like the below prompting me to reactivate.

Here’s the most recent one I received from Stan giving me a free month:

In my opinion, the winback budget could be better spent rewarding loyal customers. For example, giving the free month to members who have achieved a streak of X (i.e., 6) continuous months, or who have reached a certain status, or who have consumed a certain amount of content (depending on the design of the loyalty program).

This creates an opportunity to celebrate with members, create more memorable moments and build emotions bonds, rather than being stuck in a cycle of losing them and winning them back.

This brings me to my next question…

Would they be a good potential future client for Loyalty & Reward Co?

I think the subscription streaming services should absolutely invest in a loyalty program which would deliver a number of key benefits including:

  • Acquisition: by strengthening the value proposition for the subscription service and by making owning a membership (rather than logging in with someone else’s membership) more appealing and rewarding
  • Spend: by stimulating upsell to better packages to unlock better rewards
  • Content consumption: recognising and rewarding members for consuming specific content and gamifying the experience
  • Share of wallet: getting members to exclude competitors from their consideration set and concentrate their spend with the one streaming service in order to unlock better rewards which they cannot access from competitors
  • Retention and stickiness: build in exit barriers and capitalise on loss aversion so that consumers are provided with a ‘reason to stay’. This also de-risks the business when there may be a content lull
  • Advocacy: by leveraging engaged customers with high satisfaction to become promoters

Overall, the subscription streaming services are delivering well in terms of product, data practices and personalisation. However, there is a clear opportunity to leverage a loyalty program to build on the value they provide to customers and provide them with a compelling reason to stay beyond the content and the experience.

And there’s still a first mover advantage up for grabs for the subscription streaming service game enough to lead the way with a loyalty program.

So to answer my own questions:

  1. Is delivering value through personalisation enough? NO
  2. Should I unsubscribe from my own account when there’s nothing I’m watching and re-subscriber later? YES
  3. Would these companies be a good potential future client for Loyalty & Reward Co? YES

[1] Sawhney, M., n.d., ‘Applications of AI in Marketing and Customer Experience Management; Identify use cases in Marketing, Sales and Customer Service – Course 5’, accessed 23rd May 2020.

[2] Cameron, N., 2016, ‘Report: Aussie consumers value their online behavioural data at $50’, CMO,, accessed 17 April 2019.

[3] “The value of getting personalization right—or wrong—is multiplying”, McKinsey, Nov 2021

<a href="" target="_self">Stacey Lyons</a>

Stacey Lyons

Stacey is the Loyalty Director at Loyalty & Reward Co, the leading loyalty consulting firm. Loyalty & Reward Co design, implement, and operate the world’s best loyalty programs for the world’s best brands. Stacey has extensive experience in loyalty, digital marketing and eCommerce with roles at ModelCo, MyHouse and Boost Juice. For the past five years, Stacey has worked with Loyalty & Reward Co clients to design loyalty programs, apply loyalty psychology, develop member lifecycle communications strategies and data capture, reporting and analytics strategies. Stacey co-created the book Loyalty Programs: The Complete Guide, the most comprehensive book on loyalty program theory and practice available. She also presents a number of modules as part of the Loyalty Programs Masterclass run by Loyalty & Reward Co in conjunction with ADMA.

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