Mexican Consumers Warm Up to Streaming Services But Remain Wary of Price Hikes

The use of streaming services in Mexico has history, but it was the pandemic that triggered a significant surge in their adoption. Online entertainment served as a virtual window for Mexican consumers, who were confined to their homes at that time. Even as the pandemic waned, Mexican consumers have continued to embrace streaming, providing a steady audience for streaming providers.

According to the National Audiovisual Content Consumption Survey of the Federal Institute of Telecommunications (IFT), paid subscription services for online entertainment were not widespread before the pandemic (2019). Only 38% of those surveyed reported having such a service. However, by 2023, this figure had risen significantly to 50%, indicating a clear shift in consumer behavior.

ThinkNow recently conducted a nationally representative quantitative survey in Mexico with the aim of understanding the streaming services landscape in the region across ethnicity, gender, age, and socioeconomic levels. The survey provided valuable insights into category dynamics, including the rankings for popular services available to Mexican consumers and their subscription preferences.

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But first, let’s look at how Mexican consumers access online entertainment.

Streaming Services Consumption Habits

Mexican consumers are avid users of streaming services, averaging 3 hours daily watching movies, videos, or listening to music online. Smartphones and Smart TVs are the preferred devices for accessing streaming content. Studies suggest that streaming services have become indispensable to Mexican household budgets. Unlike in past trends, consumers now prioritize paying for these services with cash through debit cards or in person at convenience stores like OXXO. This shift highlights how streaming services have transformed from a luxury to a necessary monthly expense.

Major Players in Video and Audio Streaming

On average, Mexican consumers use three video and two audio streaming services. Over 70% of video streaming users subscribe to Netflix, followed closely by Disney+ and Amazon Prime Video. In the audio realm, Spotify remains the top choice. However, YouTube Music and Amazon Prime Music are popular music and podcast options. Interestingly, higher-income groups subscribe to more video streaming services than their lower-income counterparts. However, this trend doesn't apply to audio streaming services, suggesting wider accessibility across income levels.

Does Loyalty Exist?

Growing demand for features like broader content libraries and lower subscription fees should be top of mind for streaming services providers. A staggering half of respondents admitted canceling a service due to rising subscription costs. Cost increases, which have disproportionately impacted Millennials, coupled with perceived limited content selection (for audio and video), have motivated users to seek more convenient options that better balance price and content. The 2021 digital tax implementation forced some platforms, like Netflix, to raise prices, ultimately burdening users. With additional price hikes possible, consumer loyalty may be hard to find.

How much do Mexican consumers pay? An average of 457 Mexican pesos (US$27) for video and 274 (US$16) for audio streaming services. Loyalty to any of these platforms hinges primarily on the quality and variety of content offered. Younger generations (Gen Z and Millennials) are more willing to pay a premium for broader content selection. Boomers, not so much. Aside from the content offered, Mexican consumers consider what each streaming service offers before deciding which service to subscribe to.  While cost is important, consumers also consider promotions and free trial lengths when choosing a streaming service.

Are Consumers Satisfied with Streaming Services?

Eight out of ten respondents reported being “very” or “somewhat” satisfied with their current video and audio streaming services, with Gen Z reporting the lowest satisfaction levels. Like brand loyalty, satisfaction hinges on consumers' ability to get a wider content selection at a more affordable price. To compensate, many users have turned to account sharing in the past to manage costs. However, as streaming services like Netflix and Spotify crack down on that, now charging for account sharing, the practice no longer gives users the relief they were looking for.  

Mexican consumers demand more value – a wider variety of content at a lower cost. This presents a challenge for streaming services. Subscribers naturally want to keep their entertainment options, while platforms need to maintain profitable content libraries. Strategic partnerships between services may offer a solution, providing content diversity without breaking the bank.

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