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UK Consumers Pay More for Digital Products PDF Print E-mail
Written by eMarketer   
27 Jun 2013
According to a survey from Worldpay, UK consumers spend much more on digitally delivered products than US consumers.  The survey asked respondents in both countries how much they were willing to pay for various digital products, findings show how UK consumers will pay more in almost all cases and sometimes twice as much.

 

But the picture is much more complicated than a straightforward willingness to pay more. UK consumers are still most familiar with a content delivery model whereby they get stuff for free. The delivery of high-quality content from noncommercial institutions like the BBC has led to this kind of mindset, and it’s one that’s well-entrenched. In a March 2013 survey from UK media law firm Wiggin, less than one-third of UK internet users felt that free online services were less valuable than paid-for services.



With free services held in such high regard, it may be surprising that UK consumers would pay more for digital products. But a lack of uptake of subscription services is likely causing UK consumers to pay a premium—when they do pay. According to WorldPay, fewer UK respondents had purchased digital products via a subscription service than had US respondents across all service categories.



This laggard uptake of subscription services is highlighted quite well by comparing the TV/video streaming landscape in each country. In the US, according to AYTM Market Research, 24.5% of US internet users had subscribed to Netflix as of May this year, with a further 11.7% having subscribed to Amazon Prime. In the UK, according to RBC Capital Markets, just 9% of internet users had visited Amazon’s LOVEFiLM Instant subscription site as of February this year, while only 6% had visited Netflix’s site. In stark contrast, 50% had visited the BBC’s free iPlayer website.

With free, high-quality content a staple in the UK consumer’s diet, digital service providers face a difficult task in driving the uptake of subscription services. But one side effect of this less-developed subscription model is that when UK consumers make one-off purchases of digital services, they are prepared to pay a premium, and sometimes a quite hefty one.

Last Updated ( 03 Sep 2013 )
 
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