Wednesday, July 13, 2016

STUDY. Leave my DStv alone: Cash-strapped South Africans would rather eat less, buy less, cut back on everything else before they let go of their DStv and M-Net.

With the worsening South African economy and disposable income dropping, a new study shows that people simply cannot bear to be without their pay-TV: South African consumers would rather eat less, buy less groceries, give up cigarettes, buy less clothes and even drink less, than to give up their DStv and M-Net.

New market research from Old Mutual looked at various South African income groups and what they would be willing to give up first, and then in a continuum, if they're forced to cut back on discretionary spending.

The Old Mutual survey, conducted across 1 000 households across various income groups, indicated that South African households, across the board - from those earning less than R6 000 to those earning over R40 000 and more per month - are least likely to cut back on their children's education and school expenses and then electricity and water bills.

Across the board, as South Africans cut back with a squeeze on personal households budgets, travel and holidays are first to go. Next is eating out and spend on entertainment (but not in-house entertainment like DStv), followed by things like cutting back on alcohol, buying shoes, clothing, spending money on hair and beauty and cigarettes.

Although MultiChoice's pay-TV services like DStv and M-Net are actually a luxury discretionary service, the survey reveals that South Africans - when it comes to paying for subscription television that's better than for instance the weak offering from the SABC as public broadcaster - actually regard it more like a must-have necessity in their daily lives.

As consumers are tightening their belts as they feel the money squeeze, they absolute loathe letting go of their DStv or M-Net once they have it. 

According to the survey, financially stressed South African households simply cannot bear parting with their DStv or M-Net and will rather eat less and buy less groceries, cut back on expenses regarding domestic workers and a gardener, buy less shoes and clothing, and entertain less at home before giving up their satellite TV dish.

Interestingly, the higher the monthly income of a household, the more adamant they are that they won't give up their DStv subscription - although it's actually a non-essential expenditure item. 

While DStv is the 4th last thing households earning less than R6 000 per month will give up or cut back on, households earning more than R40 000 per month are even more adamant not to lose their access to pay-TV once they have it.

Households earning R40 000 and more, absolutely abhor the idea of being without their DStv: for them it ranks as the last thing they're cutting back on or are willing to cut back on, at only 16% of the group falling in this household income bracket.