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VALS™ Lens Applying VALS™ to current events January 2015

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In this issue:

In Cable: Number of Subscribers Declines

The Week (5 December 2014) featured an article—"Television 2.0"—describing the impact of streaming-video services on cable subscriptions. According to VALS™/GfK MRI spring studies, the number of households that rent video from Netflix has grown from 6% in 2009 to 13% that rent or stream video in 2014 (27% of Innovators and 17% of Achievers and Experiencers). The Week's media analyst, Jeffrey Kagan, forecasts the television environment "is going to be a completely different space in five years." The article asks, "Does this mean that cable is doomed?" The number of households subscribing to cable peaked in 2002: 66% of households subscribed. Innovators, Thinkers, and Achievers were the three groups most likely to have a cable subscription. By spring 2014, only 48% of households subscribed; Innovators, Believers, and Survivors are the most likely to do so. Innovators will continue their cable subscriptions because they enjoy watching sports (football, basketball, and soccer).

Read news from the UBS Global Media and Communications Conference

On TV: Das Auto Teams With CNN Series

Volkswagen of America (VW) is the exclusive auto sponsor of CNN Films, "a series of documentary movies that CNN added to its schedule last year [2013] to help stimulate viewership and ratings," according to the New York Times (12 November 2014). CNN is no doubt delighted to have VW's sponsorship. Will Das Auto be equally delighted with sponsorship of CNN Films? Currently, VW is the exclusive auto sponsor of NBC's postgame Sunday Night Football program. Sunday Night Football has a much larger audience (25% of US adults have watched in the past 12 months) than that for TV prime-time documentaries (5%). Data for the postgame football program are not available. However, Thinkers and Achievers are more likely than average to watch Sunday Night Football. Thinkers, Believers, and Survivors are more likely than average to watch documentaries. In spring 2014 (the most recent VALS™/GfK MRI data available), Innovators, Thinkers, and Experiencers are above average in VW ownership—the groups most likely to also buy a Volkswagen new. The partnership with CNN Films is less attractive than for postgame football not only because of small audience reach but also because Believers and Survivors rarely buy new vehicles; they prefer American-made to imported vehicles and generally buy used vehicles.

Learn more about CNN Films

In Real Estate: No Physical Amazon Store in NYC

In October 2014, media reported a coming new "Miracle on 34th Street": a brick-and-mortar Amazon store. The news generated a lot of excitement; expectations were that the store would be open for the 2014 holiday-selling season. Alas, no store emerged. No loyal New York City Amazon customers could order online and pick up in Manhattan. New York City has above-average numbers of Innovators, Achievers, and Experiencers residents. Thirty-six percent of all US adults have visited Amazon.com in the past 30 days. In comparison, two-thirds of Innovators have visited during this same time period, followed by fewer than 50% of Thinkers, Achievers, and Experiencers. In the past 12 months, somewhat more than two-thirds of Innovators have purchased from Amazon, in comparison with fewer than 50% of Thinkers and Achievers. Experiencers are average for Amazon purchases. Selection and convenience are Amazon's noted benefits, with appeal to Innovators and Achievers in particular. However, a NYC store would have been most appreciated by Experiencers, because any wait to receive a purchase—even overnight delivery—is too long; most Experiencers simply can't afford the high cost of overnight shipments. In November 2014, the Seattle Times reported that Amazon's lease of a 470 000–square-foot building on 34th Street is to be for corporate office space—ground-floor retail shops will be available for sublease.

Read more about Amazon's plans for its 17-year lease in NYC

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