Developing Strategy to Enhance User Retention and Product Preference in Indonesia OTT Industry (Case Study of Vidio.com)

: The potential growth of video streaming market is derived by the growing revenue the high consumption towards entertainment in the market. This led to the intense competition in the OTT (Over-the-Top) industry, as OTT players focused their business with the subscription model that competed both for content and subscribers. Among the competitors, Vidio placed as the third rank based on the new paying subscribers in Southeast Asia. However, despite the growth of the new subscribers, the existence of weekly subscription still became a challenge to Vidio along with its impact that has tendency to result churn and unhealthy subscription cycle. To formulate strategies to enhance user retention, researcher use Consumer Decision Journey framework (McKinsey, 2009) to analyze the behaviour of the existing and ex-users of Vidio, and Customer Switching Behaviour (Keaveney, 1995) to identify the switching factors. This study conducts a quantitative method through online questionnaire and qualitative method through online interview. Those frameworks show alignment in identified the main factors of user willingness to keep subscribing and the switching factors which are content offerings, price, convenience, attractive interface and brand trustworthiness. This lead to the proposed solution based on the framework used, TOWS matrix and Diamond Strategy Model which focus on improving the competitive advantage of Vidio’s service quality including its content offerings which requires completeness, exclusiveness and attractiveness, as well as product development of feature improvement, personalized recommendation, resolution quality to improve user experience, also strengthening strategic partnership and company driven marketing to enhance the brand attractiveness that will reflect on the consumer-driven marketing while balancing the price offers with the benefit provided. Lastly, implementing a new subscription pricing strategy by creating a special monthly subscription for high-demand content is needed to result in a healthier subscription lifecycle and to avoid churn users from weekly subscription.


INTRODUCTION
In Indonesia, the daily high rate of entertainment activities is dominated by 83% of Indonesians watching videos online (Nielsen, 2021).The high consumption towards online video is reflecting the growing competition among video streaming platforms in the market.OTT player is now focusing their business the subscribed based video on demand service that competed both for content and subscribers.All those OTT players were competing in providing good quality content that aligned with their market segment along with affordable subscription fees offered in the market.Besides, the implementation of various subscription fees in the sachet scheme were also included in the strategy of some of the OTT players to attract new subscribers.However, with the intense competition, it also leads to the challenges faced by each of the players regardless of their size which is known as churn.Churn is known as the number of customers who leave the platform by canceling their subscription over a given period.In the OTT market of Indonesia, the competition is involving both local and international players such as Netflix, Disney+ Hotstar, Viu, Vidio, HBOGO, WeTV and other players followed in the list.Vidio.comknown as the leading local OTT player in the industry, that recognized in the 3 rd place based on the share of new paying subscribers in Southeast Asia while compete with other global and regional player (MPA, 2021).Vidio managed to achieve significant growth throughout the year as Vidio managed to double the number of subscribers year on year compared to 2020 and closed 2021 with a total of 2 million subscribers (Vidio, 2022).However, despite the growing number of new subscribers, the existence of churn customers becomes a concern for the company.In the current business system, Vidio were providing weekly, monthly and yearly subscriptions, which were implemented to align with the average customer buyer in Indonesia.In the current data, monthly subscription became the most preferred package with 71.6%, followed by weekly subscription with 27.1% and yearly subscription with total of 1.9% (Vidio, 2022).The existence of user preference towards weekly subscription still became a challenge to Vidio as it tends to result in churn of customers and unhealthy subscription cycle that challenge the customer retention.With that being said, Vidio not only benefits from the increase of subscriber number but also facing problems related to churn and subscription continuity.Identifying the factors behind the switching factors is needed to formulate the strategy to shift the user from weekly to a monthly subscription and to enhance the user retention.

MAIN OBJECTIVE
The purpose of this research is to identify the factors that contribute to user's willingness to keep subscribing, factors that drive customer preference to choose weekly subscription-package along with the switching factors to formulate retention strategy which includes the strategy to attract customer to switch to the monthly subscription basis.

LITERATURE REVIEW 3.1 Customer Profitability Analysis
Customer profitability analysis used to analyze the profitability of the company based on the sales towards particular customers.The data regarding customer analysis help the company to manage and understand the profit and contribution of the customer relationships, in aligning the cost for increased service cost with benefit (Hansen dan Mowen, 1999).

Consumer Decision Journey
McKinsey (2009) Consumer Decision Journey is a sophisticated approach that help the marketers to navigate the consumer's decision-making process in more circular journey which aims to capture all the touchpoints and key buying factors resulted from the explosions of product choices and digital channels.The journey includes the initial consideration, active evaluation, and post purchase experience that become a trial period that determines the customer loyalty towards a particular brand and the possibility of buying the product again and staying in the loyalty loop.

Customer Switching Behaviour
Customer Switching Behaviour is a comprehensive approach towards both pre-switching and post-switching behavior that has the possibility of being applied to a wide range of service.This approach includes eight factors that contribute to the service switching such as competition, pricing issues, inconvenience, core service failure, service encounter failure, response to service failure, ethics, and involuntary switching.While the post-switching behavior was identified as consisting of two broad categories ± word-of-mouth communications and search for new service (Keaveney, 1995).

METHODOLOGY
The analysis of this research will be using the thematic framework of Consumer Decision Journey (McKinsey, 2009) to analyze the behaviour of the existing and ex-users of Vidio along with the preference towards weekly subscription and Customer Switching Behaviour (Keaveney, 1995) to identify the switching factors.These two thematic frameworks will be used in proposing the solutions for the issue, which also complemented with the TOWS matrix and Diamond Model Strategy for the strategy implementation.The primary data collections for this research were using both qualitative method which conducted in an in-depth interview with the representative of the company in semi-structured question and complemented with literature studies that were used in the research were using books, scholarly journals, articles, news and official reports and quantitative research methods which conducted through online questionnaire to a minimum of 120 respondents.The targeted respondents are those who ever subscribed to any SVOD service.Specifically, the respondents were classified as existing and ex-users of Vidio.

SWOT Analysis
SWOT analysis known as a framework that allows the company to synthesize insight obtained from an internal analysis of the company's that identifies its strengths and weaknesses (S and W), while the external analysis provide the relevant information from the firm general environment that identify the threats and opportunities (O and T) (Rothaermel, 2019).This research conducts environmental analysis of the company which summarized through the SWOT framework analysis.

Customer Profitability Analysis
In this analysis, the researcher is using the average transaction per user, revenue and average revenue per user on a yearly basis in order to assess the profitability of the subscription package and its contribution to the business.The analysis will compare Vidio's highest two subscription packages resulting in the user transaction.According to the internal data of Vidio (2022), monthly subscription package results 128% higher ARPU than the weekly subscription, with a higher percentage respectively in terms of revenue.This higher contribution of the monthly subscription is resulted through the price of the subscription.The company also implemented a pricing strategy that results in a competitive price comparison that emphasizes more benefit towards the monthly subscription package.By 2021, the average transaction per user of monthly subscription is generate more sustained retention rate with 2.3x per user on yearly basis, while the average transaction per user of weekly subscription is 1.6x.It also reflects on the higher ARPU of the monthly subscription (H.Syafutra, personal communication, 2022).The company is aware that the weekly subscription will lead to a less healthy subscription cycle and lower ARPU and revenue.However, the continuity of the 7 days package will depend on the ARPU of Indonesian OTT customers.Moreover, in relation to the business partnership with the telecommunication provider, the partnership aims to maximize the telco provider user base to become Vidio's subscribers.Majority of the Telco's user still use prepaid mechanism.Thus, to acquire the segmented customer owned by Telco, Vidio still needs the 7 days package to match the cheaper bundling package.However, Vidio currently focuses on the monthly subscription in creating bundling packages and promotion, as the business model should continuously focus on pursuing the healthy customer cycle, which is focused on the monthly and yearly subscription package (H.Syafutra, personal communication, 2022).

Consumer Decision Journey
This analysis below will focus on existing and ex-user category.As the analysis focusing on factors that contribute to user willingness to keep subscribing, for the existing users analysis will start on the moment of purchase stage until the loyalty loop.
While the ex-user will focus on the loyalty loop or post-purchase stage that consisted of enjoy, advocate and bond stage.

Existing Users Consumer Decision Journey a. Moment of Purchase
Among the 34.2% respondents as the existing user of Vidio Premier, the five biggest factors that encourage them to subscribe to Vidio are the content offerings, by 23.4%.Next is the product review and testimony from public figures and also the subscription price factors with 14.9% each.Fourth is the convenience in using the platform by 13.5%, followed by family and friends' recommendation along with the attractive platform interface by 12.8% each.To ensure that the customer is willing to continue the subscription transaction, Vidio should focus on leveraging its content libraries competencies in providing attractive and popular content that meet with the customer demand.Further, enhancing the quality of the service through the recommendation and testimony coming from influencers and relatives which align with the consumer-driven touchpoints by ensuring the experience of the existing customer.Improving the company-driven strategy is also important in providing a positive brand image in supporting the information regarding Vidio's service in general that can be found by the customer through online search that will impact their purchase decision.Besides, there are 31.7% of the respondents have ever experienced weekly subscription.The main reason for choosing the weekly subscription was to watch particular content or seasonal for a short period of time, while 5% of the respondents defined its reason due to the affordable price offered in the weekly subscription.This weekly subscription continuity was not able to retain the customer, as most of the respondents stop their subscription after subscribing to a one cycle of weekly subscription as they only uses it to consume particular content that is available in the platform for short time period.

d. Enjoy Stage
This phase is included in the post-purchase stage of the consumer decision journey, in which it will result in the level of user's satisfaction regarding their experience and determine the continuity of their subscription, whether to stop or stay in the loyalty loop.In terms of intensity, 24.4% of the respondents still use the service on a daily basis, while 19,5% of the respondents access Vidio Premier within the range of 3-5 days a week.39% of respondents still accessed the service today or the day the respondents filled the questionnaire which shows most of the existing users are frequently using the service.It means the service able to create stickiness with the users.In terms of the enjoyment toward the quality of service, the average score resulting from the three statements which includes the alignment between the content offering and the customer needs, the quality during their watch time and the suitability of the subscription offerings towards the quality and service.It achieved an average score of 4.06 that is classified as "Agree" in having positive enjoyment while using the service.However, negative impressions still existed though it appears in a very small number.These negative responses might lead the existing customer to find other attractive alternatives.In order to maintain the stickiness of the users towards the service and to have positive level of enjoyment the company should ensure several key points addressed by McKinsey in their Three Cs of Customer Satisfaction such as the customer-journey consistency, where the company should continually work in providing superior service to the customer.Second, emotional consistency, which results in the positive customer-experience emotions based on their experience and involved with the feeling of trust, as the biggest drivers of satisfaction and loyalty.Third, communication consistency.The company should be able to hold accountable in making promises and keep promises to the customers, ensuring that the promises will be delivered adequately through clear and proactive communications with customers consistently (Pulido et al., 2014).b.Advocate Stage This stage identifies the willingness of the existing users, specifically those who have positive impressions and enjoyment to become the advocates of Vidio in giving recommendations to other potential customers of Vidio.According to the result, 78% of the existing users are willing to recommend Vidio to other people to become Vidio's subscribers, while the remaining are still not sure whether to recommend the service or not.With this result, Vidio should maximize the high percentage of the willingness of existing users in providing recommendations by creating features that can help them in sharing their experience through online channels, besides the word-of-mouth promotion mechanism.It can be done by creating share-poster template of Vidio's content to various social media with landing page to Vidio platform.Vidio can also utilize its KOL and influence to become the role model in participating in the customer-driven marketing activities so it will influence their community to do the same.Besides, maintaining consistency in the quality of service is needed to maintain customer satisfaction as well.
c. Bond Stage In this stage, 65.9% of the respondents are planning to continue their subscription, while the remaining are still not sure whether to continue or stop.The reason that influenced their decision is mainly because of the content variety that provided in the platform, specifically by the sports content that broadcasted by Vidio along with the content quality that exists.Thus, the proposed solution for this stage to gain more positive continuity of the subscription is to ensure the enhancement of the influencing factors that affect the users decision.Thus, Vidio should focus on increasing its content diversification in terms of genre and content categories variety to fulfill customer's entertainment needs.Specifically in their sports catalog, many of the users were expected to see some sporting events that are no longer available in Vidio such as BWF Series and other popular content that have not been acquired by Vidio such as Premier League and several others.Further, the quality of the content should also be managed accordingly to ensure that they provide good quality content that is attractive to the users, updated titles and supporting features while accessing the content such as options of sub-titles.

The Ex-User Consumer Decision Journey
a. Enjoy Stage Like the questions of enjoy stage for existing users.The ex-users were also asked regarding their intensity on using Vidio service while still subscribing.Followed with their experience towards overall service to seek for their enjoyment level during their subscription period.It is found that most of the respondents used the service on a particular day according to the schedule of specific content or program and with the range of 3-5 days a week with 35.9% each.While only 7.7% of the respondents use the service daily.This shows that there is low stickiness between the users and Vidio, hence it reflects the low frequency in using the service.On the other hand, in terms of the enjoyment level, the average score resulted in 3.68 which is categorized as "Agree", in which those ex-users were having positive enjoyment while using the service.However, this average is relatively low compared to the average score of the existing users that resulted in an average score of 4.06.This is mainly caused by the bigger number of respondents that have low satisfaction in their experience.Though the result is still categorized in the positive level of enjoyment, Vidio needs to be aware of the low satisfaction and enjoyment level experienced by the ex-users.The proposed solution for this part is to enhance retention activities for the users.Vidio should utilize the customer data along with the subscription period to identify the categorization of potential churn customers who are near to their end subscription period.During that time, Vidio needs to provide more personalized content recommendations based on their watching history and to send personalized notifications to inform regarding any promotion to the subscription, upcoming content in the platform that will attract the customer to stay.Creating regular surveys on customer feedback that are conducted in a short and effective way is also needed to evaluate the user's journey and identify which touchpoints caused them pain and needs improvement.This will help the company to continuously improve and maintain the service offered to the customer.b.Advocate Stage This stage was identifying several expectations of the users towards the improvement of Vidio along with their willingness to recommend Vidio to other potential customers.The 5 main improvements that are expected by the ex-users are the content quality which includes providing more exclusive and attractive content, followed by UI/UX improvements, content quality, service quality and streaming quality.Further, among the ex-users, 43.6% willing to recommend Vidio to others, while other 43.6% are still not sure whether to recommend or not and the rest choose not to recommend.The proposed solution for this to increase the high willingness of the ex-users to become Vidio's advocates is to improve the factors that are expected by the users, as it will lead them to resubscribe and to recommend their good impression while using the service to others.
c. Bond Stage Among the ex-users, it is found that 61.5% of the respondents were showing a good response to the possibility of subscribing to Vidio again in the future.And following up to the ex-users possibility to resubscribe in the future, there are several main factors that influence their decision such as content offering, while the second influencing factor is the subscription price, followed by the brand trustworthiness.The solution for this is to leverage their content libraries' competitiveness to attract their ex-user, while also aligning with the price of the subscription package.Aligning the brand recognition also plays an important role as when the user recognizes Vidio as a trusted brand then it will have a positive impact to encourage them in resubscribing to the service, and this also relates with the positive recommendation that delivered through consumer-driven marketing as well which can be achieved by ensuring the satisfaction of the existing customer.Other technical factors such as the user interface, ease of use need to be managed properly to ensure the convenience of the user as well.Besides, a retention strategy towards the subscription package can also be considered by the company if they fail to retain the customer until the end of their subscription.Then after several weeks or months since their last subscription expired, Vidio might provide a special package offering free of 7 days access that is free of commitment, however after the 7 days, they will be automatically billed for monthly subscription.Then tries to maximize all in-platform retention activities during the 7 days period as part of the retention strategy.

Ex-User Customer Switching Behvaiour
According to the factors that contribute to the service switching as explained by Keaveney (1995), it is found that there are three main factors that lead the ex-users of Vidio to stop their subscription and switch to another service.First is competition.This relates with the limited content offering in the platform that is provided by Vidio.Second is subscription price, which includes the high price offered to the customer, increasing price, price offered are not suitable with the service provided and absence of subscription promo.Third is inconvenience, which is related to the user experience that is affected by the interface, ease of using apps and streaming quality.The proposed solution for this is to ensure that all those important factors that might lead to a churn customer are managed properly by the company.Competition is clearly interconnected with content offerings, Vidio should have a competitive advantage in their content offerings by acquiring top content licenses and producing best-selling original content to strengthen its differentiation appeals in the industry.This effort should be done by pursuing exclusiveness & multi-year agreement with content suppliers, to ensure the quality of content that will be filled in the libraries along with the upcoming titles that will be able to retain users to continue their subscription.The price offerings should also be delivered properly in the market.As the priority of switching factors are content, the company needs to align with price.If the content is competitive, then the customer will adjust to the price offerings, since they no longer found any attractive alternative available.Next, regarding the service inconvenience, continuously evaluating the customer experience while improving the UI/UX are needed, while also formulating journey innovation for the users in all touch points while using the service.Furthermore, as the post-switching behaviour consisted of word-of-mouth communication and search for new service, Vidio should also maintaining the user experience along with the management of the main factors that lead to their switching behaviour are required to avoid negative sentiments of Vidio service delivered in the word-of-mouth about service switching specifically when it comes to personal stories.
of product variety that serve various customer segments preferences.• Internal partnership strengthens company resources • Strategic partnership with key external partners • Vidio Originals Content • Strong brand awareness • Competitive subscription price offerings • Multi-channel and watching platform integration • Digital marketing prowess • High preference towards the monthly subscription package Weakness • Incomplete content catalog for several categories • Non-exclusive content that available in another platform • Weekly subscription package results short active lifecycle • Absence of multi-year content agreements for particular content • Limited auto-recurring products implementation • Unavailability of on-call customer service Opportunities • Increase online entertainment consumption • Collaboration with IPTV to reach TV home market • High demand towards local content • Returned of postponed sports program due to pandemic • Potential user acquisition through bundling package with Telco partners • Vidio' s brand recognition contributes in user acquisition and retention • Indonesia's economic growth • Source of education and information content for home learning Threats • Low switching cost in the industry • The existence of pirated premium content • High bargaining power from content providers • High preference towards FTA TV in the market • Exclusiveness of popular content from competitors • Competitors's content strategy shifts towards local content • Changing regulations towards OTT business • Weekly subscription contribution towards churn rate

Figure 1 .
Figure 1.Decisive Factors to Subscribe