In our daily lives, the presence of brands is inevitable and many of them have become so strong that they are virtually replacing the name of the products themselves. To Brazilians, cotton buds are popularly known as “Cotonetes“, the name of the segment’s most known brand. While Nescau, from Nestlé, is the most popular reference to chocolate powder. Also, the question “Do you have Netflix?” has already become the most widely used way to find out if anyone has a streaming subscription, revealing how popular the brand is among Brazilians.

But as for Latin America, ensuring this hegemony in the region will not be that simple for new competitors in this market. As 2019 was a year marked by huge new streaming services’ announcements and disputes for popular shows such as Friends, the most-watched in Netflix portfolio and that had its exhibition rights stolen by HBO Max. Meanwhile, Disney+ will be released with the complete Marvel’s portfolio, owner of a huge fan community, in addition to the traditional classical stories.

And while last year big companies took advantage of the moment to put all the cards on the table, announcing their new products and their main promises; in the US, the battle has already begun to gain ground.

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Among all the giants that have launched their new products in the North American country during the second half of 2019, Disney seems to have the most powerful card up its sleeve, becoming the segment’s top competitor with an estimated market value of over $ 100 million – which means about 69% of Netflix’s current value – in only 2 months.

When it comes to Latin America, the real battle is just about to begin.

Less quantity, more consolidation

The word of the year 2019 for the streaming market was decentralization. After that big tech-companies started to bet strongly on the launch of new products in the segment, consumers experienced a real plot twist from a world where Netflix seemed to be the only option, for a new universe with several new platforms available.

In Latin America, this huge wave of competitiveness is yet to come, considering that giants like Disney+ will still debut in the region, but it is impossible to deny that the results of products already launched internationally might follow similar trends in Latin American countries. Therefore, the biggest bet is that the 2020’s word will be consolidation.

Among all new streamings that are expected to reach Latin American countries this year, a much smaller number is likely to win a significant share of this audience, mainly due to the strength that Netflix already has in the region, especially in Brazil, which is the third-largest market of the brand.

The current landscape points out that the protagonists of the dispute for the largest share of subscriptions in Latin America will be Disney+, which despite being launched just 2 months ago is already a big promise worldwide, Apple TV, HBO Max, and Amazon Prime.

Furthermore, the first local competitors have also begun to emerge in 2019 and should seek to consolidate their products among the loyal target audience of Latin American soap operas and mini-series. A great example of it is Grupo Globo, the largest media conglomerate in Latin America, which has been increasingly strengthening Globo Play, a streaming product that includes the group’s own productions and provides exclusive online content to subscribers.

ALSO READ: Largest communication conglomerate in Latin America, Group Globo wants to be a “media tech

Amidst a price war, the content remains king

As well as in any other segment, increasing competitiveness leads directly to lower prices, but in the streaming market, that’s not enough to ensure user loyalty. In this case, original productions are the real answer.

Unlike selling a physical product – in which margin reduction to offer lower prices and have profit by increasing sales volume it’s the easy way – in the streaming market, an aggressive pricing strategy may only be enough to ensure a transitory increase in subscribers, but if there are no short-term catalog releases, truth be told, those users will only be active until the next Netflix’s movie release.

Even though the big international brands have famous titles in their catalogs, Netflix has a much larger number of own titles and a speed of new releases that none of its competitors can keep up with so far. The company stands out mainly for its ability to produce local and appropriate stories for each region, delivering to the user content close to their reality and aligned with the culture, which no other great streaming has done so far. This undoubtedly is the main pillar that explains the brand’s success in Latin America.

The current global leader in the segment has a big challenge balancing the costs of these productions against the company’s profits, even though, slowing down on their original productions is definitely not an option.

In this regard, local streamings are also one step forward. In Brazil, Globo Play, for instance, stands out compared to the production of Brazilian content to serve the public that traditionally follows the plots of Brazilian soap operas and watches Rede Globo‘s open programming. In addition, the platform has also focused on music content, often releasing material related to concerts and behind the scenes of major music events by popular artists in the country.

At the end of the day, the users will win

The disruption is here for good and is taking big companies out of the comfort zone to drive the market to a new level, just like what happened in the mobility market when Uber won popularity when the increase in competitiveness promoted a decentralization of the market that demanded the improvement of the services. Now it’s streaming turn.

Regardless of the battle’s outcome for the leadership in this market, Netflix is being forced to improve its content and services to ensure the loyalty of its subscribers. On the other hand, competitors are constantly looking for new solutions to exceeds the current leader.

The final result is an undeniable evolution of the whole market to deliver the best user experience, whether it is the race to secure the most qualified portfolio or even the new distribution options of these streamings, such as how cable TV’s are allowing users to have several streamings subscriptions paying one single monthly fee, for instance.

The truth is that there is a lot of room for new players and innovation, but only those who are willing to offer a cost-effective quality experience in line with the needs of Latin Americans will achieve the mission of winning the region’s public.